Nestle Chocolates

Indian Chocolate Market

• Valued at Rs 750 Crore
• Growth stage in PLC
• Huge untapped market- penetration just
5%
• Chocolates still viewed as an indulgence
• Cadbury 70%, Nestle 24%, Amul 3%
 Pune chocolate market
• Valued at 1.5 Crore, 12,000 retail outlets
• Cadbury 85%, Nestle 8%, others 7%
• SKU’s priced below Rs.5 account for 60%
of sale
• Dairy milk 40%, Perk 10%, 5 star 10%,
gems 5%
 Nestle
• Chocolate sales – 346.51 Rs. Crore
• 24% market share
• Chocolates 13-15% of total revenue
• Product range includes Classic, kit Kat,
Munch, Choco stik, Bar one
 Nestle SWOT Analysis
• Strengths-
– Parent support
– Strong distribution network
• Weakness
– Raw material supply – volatile prices
– Chocolates - comparatively small business unit
• Opportunities
– Low penetration, consumption;
– Launch of brands from international portfolio?
• Threats
– Foreign imports
 Cadbury
• Chocolate sales of Rs 514.03 Crore
• Market leader by far – 70% share
• Dairy milk alone accounts for 30% of
market
• Other power brands include Perk, 5 Star,
Gems
• Targeting youth and adults through new
products
 Amul
• Shifted focus in 1990’s towards other milk
products. Market share down to 2-3%
• Launched in recent years 6 new brands
• New brands centered on specific
occasions/ festivals
• New brands are also targeting a specific
age group each
Marketing Mix

- Nestle Chocolates
 Product
The chocolates have a wide range to suit
different targeted segments
• Variety – Classic, Munch, Milky bar, etc.
• Design – Plain bars, filled, chocolate
covered wafers,
• Large number of Brand names
• Sizes and Packages – wide range to suit
key price points and occasions
 Price
• Pricing – In line with Cadbury’s offerings
• Incentive schemes – eg. Maha munch give
more value for the same price
• Priced at key price points like Rs.5
 Promotion
• Brand ambassador- Rani Mukherjee for
munch ( targeting youth)
• ADVERTISING
– Decreased dependence on children’s TV
channels over recent years
– 33% of total industry spend but near equal
spend on each brand with rival offerings from
Cadbury.
 Place
• General FMCG distribution structure.
• Strong coverage in urban areas,
developing in rural.
• New Regional Sales Offices to increase
width and penetration and focus in rural
areas.
 Types of competition-
Nestle chocolates

• Brand competition - Cadbury, Amul,

• Industry – sugar boiled (Parry’s, Perfetti)
• Genre – Ice creams, sweets, cream
biscuits
• Form – Greeting cards, Balloons, other
snacks
 Market segmentation
Demographic
• Age – children, youth, adults
• Urban/rural
Psychographic – (Higher end segment)
Usage rate – (Family pack segments)
Perceptual Map
STRATEGY
BCG Matrix
GE MODEL
 Porter’s 5 point analysis
• New entrants – imported brands
• Substitutes – As chocolates are viewed as an
indulgence, low threat from snacks
• Buyer power – Low buyer power since quantity
purchased is small, threat in future from
organized retail
• Supplier power – No threat of forward
integration, but volatile prices of key inputs
• Competition intensity- 2 players control 95%
 Thank you
• Nishant Betgeri (9860176449)
nishant.betgeri07@sibm.net
• Priya Bhatnagar (9890860299)
priya.bhatnagar07@sibm.net
• Writa Bhattacharjee (9860367205)
writa.bhattacharjee07@sibm.net
• Yogesh Chandorkar (9860318261)
yogesh.chandorkar07@sibm.net
• Shloke Churiwal (9860350892)
shloke.churiwal07@sibm.net
• Farhan Farooq (9822416727)
farhan.farooq07@sibm.net