Cadbury Bournville – The food of the Gods and other Top Management

Ashwini Shinde

Pramod Singh

Dharmendra Kumar

Ramesh Paloti

Vikas Misar

Prince Malhotra

Key Learning Outcomes

•History of Chocolate

•Introduction to Cadbury

•New Product Development

•Market Research

•The Launch Strategy for Cadbury Bournville

• The Marketing Communications Mix

History of Chocolate

• Chocolate begins with a bean ... a cacao bean.

• The scientific name of the cacao tree's fruit is "Theobroma Cacao" which means "food of the gods."

• In fact, the cacao bean was worshipped as an idol by the Mayan Indians over 2,000 years ago.

• In 1519, Hernando Cortez tasted "Cacahuatt," a drink enjoyed by Montezuma II, the last Aztec emperor.

• By the mid-1600s, the chocolate drink had gained widespread popularity in France.

• One enterprising Frenchman opened the first hot chocolate shop in London.

• By the 1700s, chocolate houses were as prominent as coffee houses in England.

• Sixty years later, Conrad Van Houten, a Dutch chemist, invented a cocoa press that enabled confectioners to make chocolate candy by mixing cocoa butter with finely ground sugar.

• 1824 John Cadbury opened first shop in Birmingham

• In 1876, Daniel Peter, a Swiss candymaker, developed milk chocolate by adding condensed milk to chocolate liquor - the nonalcoholic by-product of the cocoa bean's inner meat.

Introduction to Cadbury

• Cadbury India is the leading supplier of confectionery on the Indian market..

• A global leader in the confectionery/beverages market. Operating in India since 1948.

• Cadbury India has five production plants: Thane, Induri (Pune) and Malanpur (Gwalior), Bangalore and Baddi (Himachal Pradesh) and 4 sales offices (New Delhi, Mumbai, Kolkota and Chennai). The corporate office is in Mumbai.

• Cadbury prides itself on its market leading brands such as Dairy Milk, Bourn-Vita, Halls, and many more……

The company continually strives to drive innovation within the confectionery category and offers its brands in a variety of formats and pack sizes, relevant to today’s changing consumer environment. Critical to this success is innovation in the development of new products and brands.

Chocolate Confectionary Milk Food Drink Candy

As consumer’s taste for indulgence had grown, Cadbury unveiled an exciting product innovation….offering consumers the sheer luxury and goodness of dark chocolate to treat themselves.

Background to Cadbury Bournville

• On October 2008, Cadbury relaunched its Bournville brand of dark chocolates in India.

• Bournville, a much neglected dark chocolate bar from Cadburys‘, has been relaunched as a new category of dark chocolates in India.

• Dark chocolate is one of the fastest growing categories abroad. However, in India, it is still in a nascent stage.

• The brands says that one has to EARN this chocolate and not just buy it , referring to the quality of this chocolate.

• Bournville is made from the finest Ghana Cocoa beans and was launched in four variantsRich CocoaAlmondHazelnutRaisin & NutThe brand is retailed for Rs 75 for 80 gms.

• Bournville was targeted not for all customers. This brand is for those who love chocolates.

• The brand is aimed at the 20-30 yr old SEC A segment.• This is a chocolate that one will indulge when they feel like indulging. Because

this product tastes differently from ordinary milk chocolates, the brand will appeal to a select niche.The brand is asking consumers to follow a special brand ritual while eating Bournville.

One has to first enjoy the darkness of this chocolate. Then place the chocolate bar near the ears and break one cube and hear that crisp sound. Then smell the chocolate for that special aroma. Then slowly eat the chocolate enjoying it slowly.

New Product Development

• The development of successful new products is one of the ways in which companies can achieve Competitive Advantage.

• New Product Development is a process which carries a great deal of risk . Over 40% of all new product introductions fail at launch.

• For NPD to be effective, companies have to nurture an innovative corporate culture so that everyone in the organisation is encouraged to be innovative in their work.

• Cadbury takes innovation very seriously and it is a major part of Cadbury’s strategy for success.

• There are many great ideas – many of them generated by chance. However, only few products make it through to the end of the process.

• As products progress, the company is making an increasing commitment in terms of resources.

• Once a product is developed, the launch marketing costs are significant; so a company must carry out extensive market research to ensure a product has the best chance of appealing to the market.

Market Research

Market research is the gathering, recording and analysing of information about markets and their probable reaction to product, price, distribution and promotion decisions. Market research is critical for successful NPD and marketing mix planning.

There are various ways of carrying out market research

Do it yourselfFor small companies with limited resources.Market research departmentVery large organisations may have their own dedicated market research department.Market research agenciesResearch may be done with the collaboration of the company’s marketing department, but fieldwork will be carried out by the agency.Problem definitionThis is the realisation that a marketing problem needs information to find its solution.Research designThis defines what form the research will take and what will be achieved. It encompasses objectives of theresearch. The research design also includes a timeframe and the all-important costings.Data collection,This involves the actual carrying out of the research. There are two main categories of market research:Qualitative research: and Quantitative researchData analysisA process of gathering, modeling, and transforming data with the goal of highlighting useful information, suggesting conclusions, and supporting decision making.Report writingThe final report summarise the objectives of the research and give detailed analysis. It’s important that the information is clearly presented so that managers can draw clear conclusions from the report.

Researching Cadbury Bournville

• Cadbury had seen a major opportunity in developing a new category of chocolates i.e Dark Chocolate Segment.

• In a market where 70 % share is owned by Cadbury, it feels that Bournville is the right brand to develop the category.

• The research findings about the health benefits also gives an additional marketing reason to develop this category., i.e. Bournville

• The reason for the relaunch is the competition that Cadbury face from the imported brands, i.e., Ferrero Rocher, Mars etc.

• Most of the global chocolate brands like Hershey , Ferrero etc are planning their entry to the lucrative Indian market. Recently the Mars group launched their brand Snickers in the Indian market.

• The threat has forced the market leader to take a proactive defense strategy by creating new categories for dark chocolate .

In India Cadbury relaunched Bournville brand for following reasons .

Financial projections

Television AD - 5 crores

Newspapers - 3.80

Hoardings – 1cr

magazines ( health,food,fashion) - 20 lakhs

In-store positioning

The first key challenge was to find the correct in-store position for Bournville. It was decided to place the product in the confectionery section alongside other confectionery products that are for ‘in-home’ consumption. Initially, Bournville was launched in 20 cities.

The Launch Campaign

For a new product like Cadbury Bournville, the main objective of the launch campaign was to build awareness of the new brand. Cadbury approached this mainly in the form of advertising.

Sampling.In terms of marketing, since Cadbury was launching this as a new category, a lot of sampling was required. Besides traditional media campaign, there were below-the-line activities. For example, there were dark chocolate nights and dark chocolate and wine nights organised in various hotels. Cadburys have created small packs especially for sampling.

Advertising:• Bournville is being promoted via the latest TV commercial .• The creative agency is O&M and their interactive department Ogilvy One has a wondrous flash website titled Bournville in promulgating the product.

Point Of Sale (POS)

Naturally, given that the product is sold in retail outlets, in-store marketing support was also developed. This consisted mainly of attractive floor units, shelf headers and glorifiers.

Future Challenges for Cadbury Bournville

Going forward, Cadbury will still need to inform consumers about the usage occasions for Cadbury Bournville. The brand will continue to be displayed in the take-home confectionery section. Strong POS and promotion will continue to be important.

Conclusion

The introduction of Cadbury Bournville is an example of quite radical innovation. For such radical innovation the early stage is not always easy as it takes time to inform consumers and build awareness of the new product. However initial success and continued on-shelf presence suggest that Cadbury Bournville are here to stay!