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Amity Global Business School

Study Abroad Program Summer School Research Methods Assignment

Submitted by: Kaushik Pinnamaneni Submitted on: 15th July, 2011.

2 INDEX
Topic Market size of Cadbury UK Market size of Cadbury India Market value of Cadbury UK Market value of Cadbury in India Threats faced by Cadbury in UK Threats faced by Cadbury in India Opportunities for Cadbury in UK Opportunities for Cadbury in India Competitive positioning of Cadbury Bournville in UK Competitive positioning of Cadbury Bournville in India Brand value of Cadbury Bournville in UK Brand value of Cadbury Bournville in India Recommendations 7 7 7 6 Page number 3 3 3 4 5 5 6 6 6

Market size of Cadbury UK: Market size of Cadbury in UK is very high. The market value of Cadbury is approximately over 9.8 Billion USD. It is narrowly ahead of Mars and Nestle. Cadbury covers the entire market manufacturing chocolates of all ranges from low ranged products such as Dairy Milk to higher ranged products such as Bourneville.

Market size of Cadbury India: Cadbury covers the major chocolate market in India. It is the largest chocolate and confectionary manufacturer in India covering over 70% of the entire chocolate market. One of the reasons for which Kraft Foods took over Cadbury was its large market holding in several countries such as India.

Market value of Cadbury in UK: Cadbury UK makes revenue of over 5.3 Billion USD and employees over 73000 employees. Cadbury in UK makes a profit of over 300 million USD. The market value of Cadbury has increased vastly since its takeover by Kraft Foods. Mars chocolates had left Cadbury behind in terms of market value but Cadbury got back its top position after being taken over by Kraft Foods.

Company Unilever PLC

Symbol ULVR.L

Price 1,977.00

Change Down 0.40%

Market Cap 55.58bn

P/E 969.12

Associated ABF.L British Foods PLC

1,078.00

Down 0.37%

8.48bn

1,578.33

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Kerry Group PLC Nestle India Ltd. Tate & Lyle PLC Kraft Foods Inc. KFT 35.37 Up 0.03% 62.18bn 20.52 TATE.L 612.50 Down 0.16% 2.86bn 1,760.06 NESTLE.BO 4,383.90 Up 1.40% 422.67bn 48.44 KYGA.L 28.70 Up 0.44% 5.04bn 15.54

4,500.00 4,000.00 3,500.00 3,000.00 2,500.00 2,000.00 1,500.00 1,000.00 500.00 0.00

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The figure shows the current stock rate of Cadbury in comparison with various other big companies

Market value of Cadbury in India: Market value of Cadbury in India is higher than any other confectionary manufacturer in the world since Cadbury alone holds over 70 percent of Indian chocolate market while all other chocolate manufacturers put together are not higher than 30 percent.

Threats faced by Cadbury in UK: Intense competition in the chocolate market The labor costs are rising in the UK The raw material prices are rising Rising obesity and consumers obsession with calories counting. Nutrition and healthier lifestyles affecting demand for core Cadbury products. Diabetic patients are not being considered hence a market with high potential is being neglected, which would otherwise earn Cadbury high profits.

Threats faced by Cadbury in India:

Rise in the costs of dairy and chocolate products. Entry of many foreign players in the Indian market who are giving the retailers high profit margins.

The company has high exposure to foreign currency exchange rate risk.

6 Opportunities for Cadbury in UK: Through its confectionary product line, to build viable positions in prioritized markets. Cadbury is also distributing its products through the Internet

Opportunities for Cadbury in India: The Indian market and more specifically the urban areas where the penetration of chocolates is low can be developed as a future market through affordability and availability. Using information and technology bring efficiency in logistics and distribution.

Competitive positioning of Cadbury Bournville in UK: In UK Bournville has positioned itself as a top of the line dark chocolate making many variants, its closest rivals are Nestle and Mars. Bournville only produces premium dark chocolate thereby neglecting the lower segments who do not afford to purchase high costing chocolates.

Competitive positioning of Cadbury Bourneville in India: In India Cadbury Bournville is among the very few dark chocolate making brands. The dark chocolate market has been neglected ever since in India is concentrated upon by Cadbury Bourneville. It is among the most expensive chocolates available and is available in many variants.

Brand value of Cadbury Bournville in UK: Cadbury Bournville in UK is a premium dark chocolate manufacturer that focuses only on dark chocolates, Bournville is among the very few chocolates which come only in the variant of dark chocolate while no other segment such as milk chocolate or white chocolate is looked upon by Bournville. Bournville has a high brand value as it was among the first few dark chocolates ever produced in UK.

7 Brand value of Cadbury Bournville in India: Cadbury Bournville is an upcoming brand in India which was re launched in 2008, it is still trying to penetrate into the Indian market as Indians are not really used to the concept of having bitter chocolates. Currently its market is only the urban consumers and Bournville according to sources is looking into penetrating into the rural segments as well in order to increase its market value.

Recommendations: Bournville must try to expand in countries such as Russia and China where it can have a good market. Bournville must be launched in smaller packaging. Cadbury must try to introduce sugar free chocolates for diabetic and diet conscious customers. Cadbury should try to develop newer strategies in order to stop its competitors from surpassing the brand. Bournville must try to use its brand value and penetrate into other markets also apart from dark chocolate. There are many products in the UK, which are not launched in India, these chocolates have a potential to capture the Indian market as well and Cadbury should therefore try to launch them in India.

References: www.cadbury.com www.cadbury.co.uk www.cadburyindia.com www.cadburydairymilk.co.uk www.bbcnews.com www.financialtimes.com

8 www.guardian.com

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