MARKETING MANAGEMENT

ULMS 766
COURSEWORK ASSIGNMENT

Submitted by: Gautam Laxman Kamat

Student Id Number: 200772811
Submitted to: Professor Warnaby
Submitted on: 9/12/2010

This essay shall provide substantial information on the marketing strategies,

marketing segmentation, target marketing and market positioning of Cadbury
India plc. and its market dominant product-the Cadbury Dairy Milk chocolate
bar .It will also serve as a brief study and market overview of Cadbury India
plc. and the characteristics of its confectionary market in the Indian sub-
continent.
 Contents

1) History of Cadbury

2) Market segmentation, Targeting and

Positioning

3) Marketing mix

 Conclusion

 Appendix

 References
History of Cadbury:
The story of Cadbury began in 1824 when John Cadbury, a Quaker opened up a
shop selling warm beverages such as coffee, tea and also products like cocoa
and drinking chocolate. He soon became one of the most successful tradesmen
in Birmingham and established the Cadbury brothers company in 1842 with his
brother. A decade or so later, John Cadbury retired from the company for good
and left his entire business to his two sons Richard and George who helped the
company grow in leaps and bounds.(www.englishteastore.com)

Cadbury PLC entered the Indian market in 1948 by importing chocolate bars
into the country. Cadbury merged with Schweppes, a British company in 1969
to form Cadbury-Schweppes. Cadbury, 62 years on it has grown on to become
one of the biggest giants in confectionary history with a 71% market share in
the Indian confectionary market-the biggest market share for any confectionary
company around the world. Cadbury has set the standard for all other
confectionary companies in India and also enjoys a very good reputation not
only in the minds of the children and younger people but also the older
generations who enjoy Cadbury products equally. "Cadbury enjoys a value
market share of over 70% - the highest Cadbury brand share in the world! Our
billion-dollar brand Cadbury Dairy Milk is considered the "gold standard" for
chocolates in India." (www.cadburyindia.com)” In addition to this Cadbury
Dairy Milk has also achieved the distinction of a 'Super brand' as awarded by
the Super brands India Council (www.cadburyindia.com) .

Market segmentation:
"The process of splitting customers, or potential customers, in a market into
different groups, or segments, within which customers share a similar level of
interest in the same or comparable set of needs satisfied by a distinct marketing
proposition."(www.marketsegmentation.co.uk). Therefore from this we
understand that it is absolutely vital for every company to segment its market
into different category of consumers to cater to everybody's needs to the fullest.
Marketing segmentation can be further divided into different types. The relevant
variables of marketing segmentation are 1).Demographic segmentation
2).Psychographic segmentation (www.indiastudychannel.com)
Cadbury has successfully penetrated the Indian market through its intelligent
market segmentation strategies. It caters to almost every age group from
children to people in the older generation. Cadbury started its operations in
India more than 60 years ago and has maintained a strong reputation since then.
The older generations who grew up buying and eating Cadbury confectionary
prefer to stick to the brand they know so well. Although there are many strong
competitors in the Indian sub continent in the present day, Cadbury remains
unshaken and enjoys a large market share which in itself describes the brand
loyalty that the Indian consumers have towards Cadbury. Even the children
prefer Cadbury over every other brand and although the price may seem higher
than most other brands, they stick to the company that they trust.

Demographic segmentation:

Cadbury's marketing strategies weren't always the same. Before the early
nineties Cadbury used to focus only on marketing dairy milk for children. But
over the years they have managed to cater to the older generations with several
intelligent and humorous add campaigns that, has helped the older generations
to look at Cadbury dairy milk as a sweet delight that even an older person can
enjoy not just children. Therefore the target market includes people of all ages.
The pricing of the products also usually have direct effects on how well the
product sells. The Cadbury dairy milk product has adapted the medium pricing
strategy so as to make sure that almost every income group can afford a bar of
chocolate if not daily at least occasionally.

Psychographic segmentation:

This kind of segmentation is based on the lifestyles of the consumers

(www.tutor2u.net).Since this segmentation deals with the psychology of
consumers it is the most trickiest part for companies to market their brand."It
considers a number of potential influences on buying behaviour, including the
attitudes, expectations and activities of consumers. If these are known, then
products and marketing campaigns can be customised so that they appeal more
specifically to customer motivations."(www.tutor2u.net). Psychographic
segmentation is based on several different factors i.e. lifestyles, occasions and
degree of loyalty. The lifestyles of Indian people differ vastly from one income
group to another or one part of the country to another. Therefore using these
factors to strengthen market demand would prove very useful for companies.
The Indian lifestyle is fast becoming a very rich lifestyle and hence the
purchasing power of an average Indian has increased substantially over the last
2 decades. Taking this fact into account Cadbury Dairy Milk has great sales on
an average of Indian people are a very fun loving people therefore they love to
celebrate whether its festivals or an occasion or anything that is they find worth
celebrating. Cadbury has used this window of opportunity to promote Cadbury
Dairy Milk as the dessert for every occasion through numerous advertising
campaigns on the television, radio, billboard advertising and in-store
advertising.

Marketing mix of Cadbury:

Product:

The Cadbury dairy milk chocolate bar has been in the market for more than 60
years now and they have always managed to maintain high standards for the
product. The Dairy milk chocolate bars come well-packed in aluminium wraps
which are further sealed in an airtight, weather-proof, printed, plastic
packaging, so as to keep the chocolate bars in edible form through the year. The
Dairy Milk chocolate bars come in variants of 10g, 50g, 250g, the family pack
of 500g and celebration packs for occasions and festivals.

Price:

As the products come in various sizes the pricing for each of them is different.
The 10g pack is sold for 5 INR, the 50g pack is sold for 10 INR, the 250g is
sold for 20 INR and the family pack of 500g is sold for 80 INR and the
celebration packs are sold for 120 INR. The pricing strategy adapted by
Cadbury is a medium pricing strategy so as to cater not only to the higher and
middle income group but also the lower middle income and lower income
groups.
Place:

The distribution Channels for confectionary in India for the year 2007 is as
follows: Independent retailers 76.70%, Convenience stores 13.30%, Specialist
retailers 4.70% and other sources which account for 5.30% (Data monitor,
November 2008). More than 90 % dairy milk chocolate bars are sold in urban
and semi -urban areas and the rural areas hardly account for the sales as a
chocolate bar is still considered as luxury in rural areas. The urban areas are the
prime reason for revenue generation since the people belonging to such areas
are usually categorised in the middle, higher middle and higher income groups
and are able to afford Cadbury products more often than people in the rural
areas.

Promotion:

Cadbury has usually promoted its product in the market in ways that it would
penetrate the market and cater to all age groups. The promotion has almost
always been done with the most innovative and award winning advertising
campaigns that catches the attention of the public. Before the early nineties
Cadbury was promoting dairy milk only for children but after that they realised
that there is a larger market share to be had by promoting dairy milk as a
universal (for all age groups) product. Other than this there is Advertising on
bill boards, television, radio, and also in- store advertising. Promotion has also
been done through giving free gifts and keeping several contests from time to
time especially for targeting the younger age groups. Other than this, seasonal
offers which give discounts or extra for the same price are also techniques used
by Cadbury to lure in more consumers.

Conclusion:
In brief the Dairy Milk chocolate bar has been a grand success for Cadbury. It
now holds a massive market share in the chocolate industry which makes it one
of the highest selling brands of chocolate in the world. As explained above
Cadbury is targeting people of all age groups and is managing to do it
successfully. It is also one of the most reputed and well-known brands in the
Indian subcontinent and is firmly maintaining its market position as the
undisputed leader in the confectionary market. Its market segmentation
strategies have been a huge success, Cadbury does a bit of both, demographic
and psychographic segmentation. Also the marketing mix a vital part which
helps the product enjoys the position it is in today.

Appendix:
Industry overview:

The Confectionary industry consists of various products such as sugar

confectionary, chocolate, gum and cereal bars (Data monitor, November
2008).The Dairy Milk chocolate bar falls under the category of chocolate
market. Cadbury enjoys a massive 71% market share (www.cadburyindia.com)
in the confectionary market with Dairy Milk being its most dominant brand
which accounts for almost half of Cadbury’s market share. Its main competitors
are Nestle and Perfetti Van Melle with market shares of 15.50% and 14.70%
respectively (Data monitor, November 2008). Cadbury’s main motto is “make
today delicious”. (www.cadburyindia.com). Cadbury Dairy milk , the product is
one of the most well-known brands of chocolate not only in India but around the
world amongst all age groups. In terms of competition it is far ahead when
compared to its competitors. This concludes the industry overview.

References:
History of Cadbury (2009) [online] Available at:
(http://www.englishteastore.com/cadbury-history.html) [accessed on 8 Dec.
2010]

Company Overview (N.D) [online] Available at:

(http://www.cadburyindia.com/cadtoday/company.asp) [accessed on 8 Dec.
2010]

Market Segmentation- Psychographic Segmentation (N.D) [online] Available

at: (http://tutor2u.net/business/marketing/segmentation-psychographic.html)
[accessed on 8 Dec. 2010]
Marketing Segmentation Strategies used by Cadbury (2009) [online] Available
at: (http://www.indiastudychannel.com/resources/83859-Marketing-
Segmentation-strategies-used-by.aspx) [accessed on 8 Dec. 2010]

Who we are? (N.D) [online] Available at:

(http://www.cadburyindia.com/cadtoday/who_we_are.asp) [accessed on 8 Dec.
2010]

Market Segmentation (N.D) [online] Available at:

(http://www.marketsegmentation.co.uk/segmentation_tmsc.htm) [accessed on 8
Dec. 2010]

Awards (N.D) [online] Available at:

(http://www.cadburyindia.com/cadtoday/awards.asp) [accessed on 8 Dec. 2010]

Confectionary in India (Nov.2008) [online] Available at: Discover:

DataMonitor [accessed on 8 Dec. 2010]