CADBURY History Cadbury was a British confectionery company, the industry's second-largest second-largest globally after the combined MarsWrigley. Headquartered in Cadbury House in the Uxbridge Business Park in Uxbridge, London Borough of Hillingdon, England and formerly listed on the London Stock Exchange, Cadbury was acquired by Kraft Foods in February 2010. The company was an ever-present constituent of the FTSE 100 from the index's 1984 inception until its 2010 takeover. The firm was known as "Cadbury Schweppes plc" from 1969 until a May 2008 demerger, which saw the separation of its global confectionery business from its U.S. beverage unit, which has been renamed Dr Pepper Snapple Group Inc.
Early history In 1824, John Cadbury began vending tea, coffee, and drinking chocolate, which he produced himself, at Bull Street in Birmingham, England. John Cadbury later moved into the production of a variety of Cocoas and Drinking Chocolates being manufactured manufactured from a factory in Bridge Street, supplying mainly to the wealthy due to the high cost of manufacture at this time. During this time a partnership was struck between John Cadbury and his brother Benjamin. At this time the company was known as 'Cadbury Brothers of Birmingham'. The two brothers opened an office in London and in 1854 received the Royal Warrant as manufacturers of chocolate and cocoa cocoa to Queen Victoria. Around Ar ound this time in the 1850s the industry received a much needed boost with the reduction in high import taxes on cocoa; this allowed chocolate to become more affordable to everyone. Due to the popularity of a new expanded product line, including the very v ery popular Cadbury's Cocoa Essence, the company's success led to the decision in 1873 to cease the trading of tea. Around this time, master confectioner Frederic Kinchelman was appointed to share his recipe and production secrets with Cadbury, which led to an assortment of various chocolate covered items. Having taken over the business in 1861, John Cadbury's sons Richard and George decided in 1878 that they needed to find new premises. Requiring better transport access for milk that was inward shipped by canal, and cocoa that was brought in by rail from London, Southampton and Liverpool docks, the Cadbury's started looking for a new greenfield site. Noticing the development of the Birmingham West Suburban Railway south along the path of the Worcester and Birmingham Canal, in 1878 they acquired the Bournbrook estate, comprising 14.5 acres (5.9 ha) of countryside 5 miles mile s (8.0 km) south of the outskirts of Birmingham. Located right next to the new Stirchley Road railway station, itself directly opposite the canal, they renamed the Bournbrook estate to Bournville and opened the Bournville factory in 1879.
In 1893, George Cadbury bought 120 acres (49 ha) of land close to the works and planned, at his h is own expense, a model village which would 'alleviate the evils of modern more cramped living conditions'. By 1900 the estate included 313 cottages and houses set on 330 acres (130 ha) of land. la nd. As the Cadbury family were Quakers Q uakers there were no pubs in the estate; in fact, it was their Quaker beliefs that first led them to sell tea, coffee and cocoa as alternatives to alcohol. The history of the company, from its origins up to modern times, has been charted in the recent book by John Bradley.
1900 to 1950s In 1905, Cadbury's launched its Dairy Milk bar, with a higher proportion of milk than previous chocolate bars, and it becomes the company's best selling product by 1913. Fruit and Nut was introduced as part of the Dairy Milk line in 1928, soon so on followed by Whole Nut in 1933. By this point, Cadbury's was the brand leader in the United Kingdom. These were accompanied by several other products: Flake (1920), Cream-filled eggs (1923), Crunchie (1929) and Roses (1938). Cadbury's Milk Tray was first p roduced in 1915 and continued in production throughout throughout the remainder of the First World War. More than 2,000 of Cadbury's male employees joined the Armed Forces and to support the war effort, Cadbury provided clothing, books and chocolate to soldiers. After the war, the Bournville factory was redeveloped and mass production began in earnest. In 1918, Cadbury opened their first overseas factory in Hobart, Tasmania and in 1919 undertook a merger with J. S. Fry & Sons, another chocolate manufacturer manufacturer which saw the integration of well-known brands such as Fry's Chocolate Cream and Fry's Turkish Delight. During World War II, II , parts of the Bournville factory were turned over ov er to war work, producing milling machines and seats for fighter aircraft. Workers ploughed football fields in which to plant crops. As chocolate was regarded as an essential food it was placed under government supervision for the entire war. The wartime rationing of chocolate ended in 1949, 1 949, and normal production resumed. Cadbury subsequently built new factories and had an increasing demand for their products.
Merger with Schweppes
Cadbury merged with drinks company Schweppes to form Cadbury Schweppes in 1969. Cadbury Schweppes went on to acquire Sunkist, Canada Dry, Typhoo Tea and more. In the US, Schweppes Beverages was created and the manufacture of Cadbury confectionery brands were licensed to Hershey's. Snapple, Mistic and Stewart's (formerly Cable Car Beverage) were sold by Triarc to Cadbury Schweppes in 2000 for $1.45 billion. In October of that same year, Cadbury Schweppes purchased Royal Crown from Triarc.
Demerger In March 2007, it was revealed r evealed that Cadbury Schweppes was planning to split its business into two separate entities: one focusing on its main chocolate and confectionery market; the other on its US drinks business. The demerger took effect on 2 May 2008, with the drinks business becoming Dr. Pepper Snapple Group Inc. In December 2008 it was announced that Cadbury was to sell its Australian beverage unit to Asahi Breweries.
Recent developments In October 2007, Cadbury announced the closure of the Somerdale Factory, Keynsham, Keynsham, formerly part of Fry's. Between 500 and 700 jobs were affected by this change. Production transferred to other plants in England and Poland. In 2008 Monkhill Confectionery, the Own Label trading division of Cadbury Trebor Bassett was sold to Tangerine Confectionery for £58million cash. This sale included factories at Pontefract, Cleckheaton and York and a distribution centre near Chesterfield, and the transfer of around 800 employees. In mid-2009 Cadbury replaced some of the cocoa butter in their non-UK chocolate products with palm oil. Despite stating this was a response to consumer demand to improve taste and texture, there was no "new improved recipe" claim placed on New Zealand labels. Consumer backlash was significant from environmentalists environmentalists and chocolate lovers. By August 2009, the company announced that it was reverting to the use of cocoa butter in New Zealand. In addition, they would source cocoa beans through through Fair Trade channels. From inside reports the change to Palm Oil cost Cadbury, New Zealand 12 million i n sales. In January 2010 prospectitve buyer Kraft pledged to honour Cadbury's commitment.
KRAFT has launched a major charm offensive in the wake of its controversial pounds 11.7 billion takeover of Cadbury - to remind consumers it is not just "a North American cheese company." The group's UK boss Nick Bunker admitted Kraft's image in Britain needed a facelift following its successful swoop for the Birmingham chocolate maker after a bitter six-month battle. Mr Bunker, now the overall head of Bournville as leader of the Cadbury and Kraft business in the UK and Ireland, said: "Kraft was known as a North American cheese company. But we have been in the UK for 85 years. "The company needs to be better understood. "We are a big company in the UK now and it is important people know the entity behind the famous brands. People didn't know who Kraft was and that we had been in the UK for 85 years. They didn't know we had a heritage in the UK and a bigger chocolate business than Cadbury before we bought i t. "We will prove over time that we're worthy custodians of the brand," he said, adding: "Cadbury is thriving and will continue to thrive. "If we decided to reformulate Cadbury and make it taste like Hershey, the nation would stop buying it overnight. "We have more than 40 brands that are more than 100 years old, we know how important heritage is." Last October, Kraft chief executive Irene Rosenfeld told the Mail that Cadbury l could look forward to a prosperous future under the US group ownership, with full integration of the two operations completed as early as the end of this year. But she has refused to go beyond Kraft's current twoyear guarantee on manufacturing jobs despite publicly apologising for the US giant's about-turn on the closure of its Somerdale factory, near Bristol. Unions claim Kraft will come under huge pressure to cut costs and pay off debts in the aftermath of the Cadbury takeover.
Mission At Cadbury Schweppes, our core purpose is "Working better together to create brands peope love". The core purpose captures the spirit of what we are trying to achieve as a business. We collaborate and work as teams to convert products into brands.
Vision To align with our core purpose, Cadbury India has defined its Vision as "Life Full Of Cadbury and Cadbury Full of Life". Cadbury India will participate in many spaces of consumer life through a cache of product & service offerings - be it chocolates or snacks or gum. We believe that work and fun can co-exist beautifully. Therefore at Cadbury India, it's all about work hard, play harder!. We bring moments of delight to our consumers everyday and every time. Therefore, we strongly believe that those people who create these products should also have fun while doing so.
Marketing strategies In order to increase sales Cadburys needs to undertake a range of marketing activities before deciding upon the best way to encourage the purchase of its product. When identifying the basic principals which Cadburys must apply to its marketing will be its basic objectives because all business must have objectives it allows them to increase sales and make profit. Corporate aims are the long term intentions of a business, whereas corporate objectives are the specific targets required to achieve the aims. The common aim and objectives of the corporation such as Cadbury includes the following: 1 Survival 2 Profit maximisation- which is often taken to be the reason why firms exists and to be the primary objectives in practices most firms have a hierarchy of objectives when a firms survival is threaten it may profit maximise in order to restore its financial health. 3 Growth- which includes Cadbury selling new products or expanding overseas. 4 Diversification- which is the spreading of business risks by reducing dependence on one product. 5 Sales maximisation- which is the increasing of sales 6 Improving the product image-which includes creating a new logo or launching a new brand of product and creating more attractive packaging. For example, Cadbury set out two objectives for the development of their chocolate, Fuse. These were: 1. To grow the market for chocolate confectionery 2. To increase Cadbury's share of the snacking sector When launching a product the company Cadburys had to make sure that any new product in the snaking sector must establish points of difference, creating a unique selling proposition (USP) i.e. a product with unique appeal which is not shared by any of its competitors. Referring back to the example of Fuse, Cadbury lost a lot of money testing out the combination of various ingredients and more than 250 were combined before the recipe of the chocolate was finalised. As the products are developed, Cadbury tests them to ensure that consumers are willing to buy them. Cadbury then promotes its products in various ways such as the use of above the line promotion, which is where a product is advertised through consumer media such as television, magazines, newspapers and radio.
The story of Cadbury Dairy Milk started way back in 1905 at Bournville, U.K., but the journey with chocolate lovers in India began in 1948. The pure taste of Cadbury Dairy Milk is the taste most Indians I ndians crave for when they think of Cadbury Dairy Milk. The variants Fruit & Nut, Crackle and Roast Almond, A lmond, combine the classic taste of Cadbury Dairy Milk with a variety of ingredients and are very popular amongst teens & adults. Recently, Cadbury Dairy Milk Desserts was launched, specifically to cater to the urge for 'something sweet' after meals. Cadbury Dairy Milk has exciting products on offer - Cadbury Dairy Milk Mi lk Wowie, chocolate with Disney characters characters embossed in it, and Cadbury Dairy Milk 2 in 1, 1 , a delightful combination of milk chocolate and white chocolate. Giving consumers an exciting reason to keep coming back into the fun filled wo rld of Cadbury. Our
Journey:
Cadbury Dairy Milk has been the market leader in i n the chocolate category for years. And has participated and been a part of every Indian's moments of happiness, joy and celebration. Today, Cadbury Dairy Milk alone holds 30% value share of the Indian chocolate market. In the early 90's, chocolates were seen as 'meant for kids', usually a reward or a bribe for f or children. In the Mid 90's the category was re-defined by the very popular `Real Taste of Life' campaign, shifting the focus from `just ` just for kids' to the `kid in all of us'. It appealed to the child in every adult. And Cadbury Dairy Milk became the perfect expression of 'spontaneity' and 'shared good feelings'. The 'Real Taste of Life' campaign had many memorable executions, which people still fondly remember. However, the one with the "girl dancing on the cricket field" has remained etched in everyone's memory, as the most spontaneo s pontaneous us & uninhibited expression of happiness. This campaign went on to be awarded 'The Campaign of the Century', in India I ndia at the Abby (Ad C lub, Mumbai) awards. In the late 90's, to further expand the category, the focus shifted towards widening chocolate chocolate consumption amongst the masses, through the 'Khanewalon Ko Khane Ka Bahana Chahiye' campaign. This campaign built social acceptance for chocolate consumption amongst adults, by showcasing collective and shared moments.
More recently, the 'Kuch Meetha Ho Jaaye' campaign associated Cadbury Dairy Milk with celebratory occasions occasions and the phrase "Pappu Pass Ho Gaya" became part of street language. It has been adopted by consumers and today is used extensively to express joy in a moment of achievement / success. The interactive campaign for "Pappu Pass Ho Gaya" bagged a Bronze Lion at the p restigious Cannes Advertising Festival 2006 for 'Best use of internet i nternet and new media'. The idea involved a tie-up t ie-up with Reliance India Mobile service and allowed students to check their exam results using their mobile service and encouraged those who passed their examinations to celebrate with w ith Cadbury Dairy Milk. The 'Pappu Pass Ho Gaya' campaign also went on to win Silver for The Best Integrated Marketing Campaign and Gold in the Consumer Products category at the EFFIES 2006 (global benchmark for effective advertising campaigns) awards.
Did You Know: Cadbury Dairy Milk emerged as the No. 1 most trusted brand in Mumbai for the 2005 edition of Brand Equity's Most Trusted Brands survey. During the 1st World War, Cadbury Dairy Milk supported the war eff ort. Over 2,000 male employees joined the armed forces and Cadbury sent books, warm clothes and chocolates to the front.
Fivestar Chocolate lovers for a quarter of a century have indulged their taste buds with a Cadbury 5 Star. A leading knight in the Cadbury C adbury portfolio and the second largest after Cadbury Dairy Milk with a market share s hare of 14%, Cadbury 5 Star moves from strength to strength every year by increasing its user base. Launched in 1969 as a bar of chocolate that was hard outside with soft caramel nougat inside, Cadbury 5 Star has re-invented itself over the years to keep satisfying the consumers taste for a high quality & different chocolate eating experience. One of the key properties that Cadbury 5 Star was associated with was its classic Gold colour. And through the passage of time, this was one property that both, the brand and the consumer stuck to as a valuable association. Cadbury 5 Star was always unique because of its format and any communication communication highlighting this uniqueness, went down well with the audiences. From 'deliciously rich, you'd hate to share it' in the 70's, to the 'lingering taste of togetherness' & 'Soft and Chewy 5 Star' in the late 80's, the communication always paid homage to the t he product format. More recently, to give consumers another reason to come into the Cadbury 5 Star fold, Cadbury 5 Star Crunchy was launched. The same delicious Cadbury 5 Star was now available with a dash of rice crispies.
Cadbury 5 Star & Cadbury 5 Star Crunchy now aim to continue the upward trend. This different and delightfully tasty chocolate is well poised to rule the market as an extremely successful brand.
Did you know: Cadbury 5 Star played an adept cupid for young couples in love in the 70's. In I n fact, Cadbury 5 Star was a way of professing undying love for the significant othe
Cadbury perk A pretty teenager; a long line, and hunger! Rings a bell? That was how Cadbury launched its new offering; Cadbury Perk in 1996. With its light chocolate and wafer construct, Cadbury Cadbury Perk targeted the casual snacking space that was dominated primarily by chips & wafers. With a catchy jingle and tongue in cheek advertising, this 'anytime, anywhere' snack zoomed right into the hearts of teenagers. Raageshwari started the trend of advertising that featured mischievous, bubbly teenagers getting out of their 'stuck and hungry' situations situations by having a Cadbury C adbury Perk. Cadbury Perk became the new mini m ini snack in town and its proposition "Thodi si pet pooja" went on to define its role in the category. As the years progressed, so did the messaging, which changed with changes in the consumers' way of l ife. To compliment Cadbury Perk's values, the bubbly and vivacious Preity Zinta became the new face of Perk with the 'hunger strike' commercial in the mid 90's. In the new millennium, Cadbury Perk moved beyond just owning 'hunger' to a "Kabhi bhi kaise bhi" position, because the urge for Cadbury Perk could strike anytime and anywhere. With the rise of more value-for-money brands in the t he wafer chocolate segment, Cadbury Perk unveiled two new offerings - Perk XL and XXL. The temptation to have more of Cadbury Perk was made even greater with the launch of Cadbury Perk Minis in 2003 for just Rs. 2/In 2004, with an added dose of 'Real Cadbury Dairy Dair y Milk' and an 'improved wafer', Perk became even more irresistible. The product was supported in the market with a new look and a new campaign. The advertisement spoke of the irresistible aspect of the brand, with 'Baaki sab Bhoola de' becoming the new mantra for Cadbury C adbury Perk.
Did you know: Cadbury Perk advertising has been a launch pad for Bollywood stars - Preity P reity Zinta, Raageshwari, Gayatri Joshi and Amrita Rao, were all Perk models m odels before they made it big on cinema c inema screens.
Cadbury celebrations Cadbury Celebrations was aimed at replacing traditional gifting options like Mithai and dry- fruits du ring festive seasons. Cadbury Celebrations is available in several assortments: An assortment of chocolates like 5 Star, Perk, Gems, Dairy Milk and Nutties and rich dry fruits enrobed in Cadbury dairy milk chocolate in 5 variants, Almond magic, raisin magic, cashew magic, nut n ut butterscotch and caramels. The super premium Celebrations Rich Dry Fruit Collection which is a festive offering is an exotic range of chocolate covered dry fruits and nuts in various flavours and the premium dark chocolate range which is exotic dark chocolate in luscious flavours. Cadbury Celebrations has become a popular brand on occasions such as Diwali, Rakhi, Dussera puja. It is also a major success as a corporate gifting brand. The communication is based on the emotional route and the tag line says "rishte pakne do" which fits with the brand purpose of strengthening your relationships with something sweet.
Did you know: The "Rishte Pakne do" jingle was penned by noted writer Gulzar.
Cadbury temptation Ever see people hide away their chocolate since they dont want to share it! If you have, then its likely to be a bar of Cadbury Temptations! Cadbury Temptations is a range of delicious premium chocolate in five flavours. Research revealed a niche segment of chocoholics - those exposed to international chocolates chocolates and those who love a variety v ariety of chocolates but possibly find the price of international chocolates too high. Cadbury Temptations is a range targeted at this segment of discerning chocolate lovers. The Cadbury Temptations range is available in 5 delicious flavour variants - Roast Almond Coffee, Honey Apricot, Mint C runch, Black Forest and Old Jamaica. With its international quality chocolate Temptations T emptations soon became a popular brand for "chocoholics".
The advertising positioned Cadbury Temptations as a chocolate range so delicious that it was "too good g ood to share".
Did you know: Cadbury Temptations advertising advertising won an advertising effectiveness - EFFIE award in 2001.
Cadbury dairymilk éclairs Eclairs was first discovered by a local confectionery firm in London, L ondon, England in the 1960s. The firm then became part of Cadbury in 1971 making Cadbury Eclairs the second largest brand in the company. The experience of eating a Cadbury Dairy Milk Eclair is truly unique because of its creamy caramel exterior and rich Cadbury Dairy Milk chocolate at the center. In 2006 Cadbury Dairy Milk Eclairs launched a crunchy Eclair with a hard caramel outside and delicious Cadbury Dairy Milk chocolate inside called Cadbury Dairy Milk Eclairs Crunch. Our
Journey:
In India, Cadbury Dairy Milk Eclairs has been the most preferred brand in the Eclairs category for years and has always been a favourite with consumers. Eclairs advertising over the years has talked about the mesmerizing taste of Eclairs because of the Cadbury Dairy Milk chocolate it contains at its center. The 'Kar De Dil Pe Jadoo' campaign illustrated this in a youthful college context. The Eclairs Crunch variant has also had an encouraging response from both teens and pre-teens. Currently, the chewy and the crunchy variants are both enjoyed by the Eclair consumer.
Did you know: A sign in front of our N Nigeria igeria factory describes Choclairs as "the sweet with heart on the inside.
Gems Cadbury Gems occupies a very special place in the hearts of k ids; present and past. Its unique shape, size, colours and format instantly set se t it apart. These tasty, colourful, chocolate buttons have become an integral part of the lives of both children and adults.
HISTORY: Launched in 1968, Cadbury Gems has captured the fancy of children for more than 4 decades now. Supported by a number of popular TVCs since s ince the Eighties, Gems is uniquely positioned because of its chocolate taste, colourful buttons and multiplicity. The taste and fun associated with eating Cadbury Gems and the joy of sharing it with friends has also made the brand a source of nostalgia for older consumers. Simply put, eating Gems brings happiness, fun and mischief to a kid's world. Which is why, Cadbury Gems has always had Fun and Masti as the proposition in all its communication. Gems, available in a Pouch and a Carton, is also available in a Re. 1 pouch. Gems has continuously been relevant and exciting for consumers with salient messaging, contemporary packaging graphics, pack innovations and consumer promotions. In December 2000, the Gems Tube Pack with a flip-top was launched, which became an instant hit with kids. k ids. In succeeding years, the Tube Pack has continued to excite kids with different ball games on its flip-top. In 2006, Gems gave kids k ids another reason to rejoice by giving them an option of consuming their favourite Gems chocolate together with a fruit flavour - Fruity Gems G ems was launched and offered fruit flavours along with the taste of Gems. Till 2007, Gems was largely speaking s peaking to younger kids (less than 8 years of o f age). While Gems became very popular amongst this age group, kids crossing this age seemed to be growing out of it. With the intent of also appealing to older Kids (aged 8-12 years) while being relevant to younger kids, Gems launched Subru communication in 2008. Subru increased the fan following of Gems in older Kids and turned out to be a very successful campaign.
In 2009, with a better understanding of older Kids, Colour was chosen as the magical element to ignite the imagination of kids and increase their affinity with Gems. To bring alive the delight of colours, Gems came up with the concept of a black-and-white panda which, after eating Gems, became a Coloured Panda. The Coloured Panda has now become an icon for Gems. The world of the Coloured Panda promises unexpected and exciting fun which doesnt exist in an otherwise routine world. Cadbury Gems is now positioned as RANGEEN PANDA KI RANGEEN PASAND. To add to its visual appeal and excitement, Gems has changed its pack graphics to a more modern, contemporary and an edgy design, together with a change in logo graphics.
Do you know? The colourful world of Cadbury Gems has six colours Red, Green, Pink, Yellow, Orange and Blue.
We are a performance driven values led business We have a clear vision, performance scorecard, priorities and sustainability commitments. As a culture we value performance, quality, respect, integrity and responsibility. We work as one team across geographic geographic and functional boundaries boundaries to be the best. We work hard and have fun along the way. We listen to our consumers, customers, suppliers, shareowners, colleagues and communities. Our success is sustained by understanding and responding to their needs. We have always believed that doing good is good for business. This belief inspired our founders, and is still at the heart of the the way we work today. today. We see it as key to our future future success.
Our
Values
We are performance driven, values led. Throughout changing times, our constant values have inspired us to be pioneers in business and in corporate responsibility. They help ensure we are proud of our company and are critical to our core purpose of creating brands people love. Our
values are:
Performance We are passionate about winning. We compete in a tough but fair way. We are ambitious, hardworking and make the most of our abilities. We are prepared to take risks and act with speed.
Quality We put quality and safety at the heart of all al l of our activities our products, our people, our partnerships and our performance.
Respect We genuinely care for our business and our colleagues. We listen, understand and respond. respond. We are open, friendly and welcoming. We embrace new ideas and diverse customs and cultures.
Integrity We always strive to do the right thing. Honesty, openness and being straightforward characterise characterise the way we do business. We have clear principles and do what we say we will do.
Responsibility We take accountability for our social, economic and environmental impact. In this way we aim to make our business, our partners and our communities better for the future. Our Business Principles are our code of conduct and also take account of global and local cultural and legal standards. They confirm our commitment to the highest standards of ethics and business conduct.
Our
Strategy
We believe that the business still has significant untapped potential both in terms of top line growth and returns. By exploiting the strength of our leadership positions to continue to grow our market share and significantly increase our margins and returns, we aim to achieve our vision of becoming the biggest and best confectionery confectionery company in the world. Our Vision into Action (VIA) plan for 2008 to 2011 aligns the energies e nergies and efforts of our teams around the world behind a number of priorities which will make the most impact on our revenue and margin performance. In order to generate superior returns for our shareowners, our VIA will deliver six financial targets. These are set out in our financial performance scorecard below: y
Organic revenue growth of 4% - 6% every year y ear
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Total confectionery share gain
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Mid-teens trading margins by 2011
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Strong dividend growth
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An efficient balance sheet Growth in Return on Invested Inves ted Capital (ROIC) To achieve these financial goals, we have a growth and efficiency strategy which aligns behind our focus on fewer, faster, bigger and better. This focus is being bei ng applied to all aspects of our business.
Driving Profitable Growth Between 2004 and 2007, our organic revenue growth averaged 6% a ye ar, a significant increase on the previous four years, when Cadburys confectionery growth g rowth averaged less than 3%, and the Adams business, which we brought in 2003, barely grew. We have significantly accelerated our growth since 2004 by unlocking the potential of the Adams business and by substantially increasing our investment in innovation, marketing and sales. Our revenue ambition of between 4% and 6% annual organic growth for the 2008-2011 is underpinned by: y
y
y
y
The strength of our brands and market positions; The increased investment we have made in innovation, marketing and sales; Our greater exposure to faster growing gr owing categories (such as gum) and markets (such as emerging markets); and Strong demand for confectionery: the market has grown consistently at around 5% every year for the last four f our years. Our revenue ambition allows for some rationalisation of our portfolio as we focus our efforts on profitable growth.
Policies Environment, Health & Saf ety Policy At Cadbury Schweppes, we see sound and responsible environmental, health and safety (EHS) management as an integral part of achieving our goal. to grow the value of our confectionery and beverages businesses for our shareowners. We aim to ensure that in the course of our business activities we not only minimise our impact on the environment ; but also look after the health and safety interests of our employees; in addition to seeking opportunities opportunities to improve the local environment and the communities in which we operate. We believe that such an approach will generate and sustain significant environmental, social and financial benefits, thereby contributing to our objective of o f long-term sustainability.
We will: 1. Conduct our business in compliance with environmental, health and safety laws and with our global standards, and regularly assess the compliance of our operations against these requirements. 2. Maintain and continually improve systems sy stems to manage our EHS responsibilities, establishing and ensuring employee accountability for our EHS performance at all levels of the organisation. 3. Set clear targets for continual improvement in our EHS performance pe rformance and monitor these targets to ensure that they are met. 4. Strive to prevent pollution and to minimise the environmental costs and impacts of our global operations. 5. Provide a safe and healthy environment for our employees, contractors contractors and other visitors to our sites 6. Assess and eliminate or control the EHS risks of new and existing operations, and continually assess the environmental performance of our products, seeking ways to contribute positively to their performance. 7. Train and motivate our employees to understand their EHS responsibilities and to participate actively in our EHS programmes 8. Work with our supply chain and business partners to improve our collective EHS performance, to protect the ecosystems that provide our raw materials and to minimise the impacts from transportation. 9. Communicate with our shareowners, employees, customers and other interested parties by regularly reporting on our EHS performance and maintaining an open dialogue.
Organizational
structure
CEO Chairman of the Board Directors Sales CFO Human Resources Legal & Secretary Science & Technology Strategy Supply Chain Global Chocolat e Global Gum
& Candy
Asia Britain & Ireland Europe Middl e East & Africa
North America Pacific South America
Nestle India
Companys Profile Nestlé with headquarters in V evey, evey, Switzerland was founded in 1866 by Henri Nestlé and is today the world's biggest food and beverage com pany. The Com pany's strategy is guided by several fundamental princi ples.
Nestlé's existing products grow through innovation and renovation while maintaining a balance in geogra phic product lines. activities and p
The com pany succeeded in achieving sustainable profitable growth during the year under the view driven by successful marketing marketing and sales strategies and focus on key initiatives. Consumer confidence in the com panys brand has further strengthened strengthened and the trade remains confident as ever in doing business with it. Innovation and renovation remained the key to develo pment of new products. In the shed of Nestlé 247,000 peo ple are working in almost every country in the world. From which almost 8,000 em ployees are working in Pakistan. Headquarters Headquarters in Lahore, the com pany o perates five production facilities. Two of its factories in Sheikhu pura product factories. One factory in Islamabad and two in Karachi produce bottled and Kabirwala and multi p
water. Through its effective marketing and a vast sales and distribution network thought out the country, it ensures that its products are made available to consumers whenever, wherever and however.
Nestlé com pany is registered in Pakistan under the com pany ordinance 1984. As its a public com pany but still not registered in any Stock Exchange in PAKISTAN Over all com pany market share is 67%. Nestlé share as com pared to nur pur,Haleeb and other are moves around 20to 30%.Total turnover:- 13.5 Billion Rupees
MISSION Build branded food business to im prove quality of life by offering tasty, affordable and
highly nutritional p product to our consumer. While maximizing stakeholder value
VISION The strategic priorities of Nestlé milk pak are focuses on delivering shareholder value through the achievement profitable long term growth. of sustainable, ca pital efficient and p
Im provements in profitability will be achieved while res pecting quality and safety standards at all times. possible time into the number one In line with this objective, we envision Nestlé milk pak to grow in the shortest p
food com pany in Pakistan with unique ability to meet the needs of consumers of every age grou p- from infancy pleasure, through develo pment of a large variety of food categories of the highest to old age, for nutrition and p
quality. professionally We envision the com pany to develo p an extremely motivated and p rofessionally trained
Innovation and renovation. renovation. We as pire, as a res pected cor porate citizen, to continue playing a significant role in the social and environmental environmental sectors of the country. Most innovative and fastest growing food com pany offering Products enjoyed in Every home every day GOALS
Nestlé 's business objective is to manufacture and market the Com pany's products in such a way as to create value that can be sustained over the long term for shareholders, em ployees, consumers, and business partners.
Nestlé does not favor short-term profit at the ex pense of successful long-term business develo pment.
Nestlé recognizes that its consumers have a sincere and legitimate interest in the behavior, beliefs and place their trust and that without its consumers actions of the Com pany behind brands in which they p
the Com pany would not exist.
Nestlé believes that, as a general rule, legislation is the most effective safeguard of res ponsible conduct, although in certain areas, additional guidance to staff in the form of voluntary business princi ples is beneficial in order to ensure that the highest standards are met throughout the
organization.
Nestlé is conscious of the fact that the success of a cor poration is a reflection of the professionalism, conduct and the res ponsible attitude of its management and em ployees. Therefore recruitment recruitment of the peo ple and ongoing training and develo pment are crucial. right p
Product Line: Build Build branded food improve quality of life y
y
by offering tasty, hygienic and nutritional products .
Nestlé products Juices
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pak 1981 Nestlé milk p
y
1983 Nestlé butter
y
1986 milk pak uht, cream desi ghee, frost
y
1990 Nestlé nido, Nestlé cerelac
y
1991 Nestlé rice, Nestlé lactogen1
y
1992 Nestlé everyday, Gloria magi
y
1994 Nestlé Milo, Nestlé neslac
y
1996 Nestlé juices, polo mint, Nescafe classic
y
1997 Nestlé kit Kat
y
1998 Nestlé toffo , Nestlé soothers, Nestlé pure life
y
2000 Nestlé plain yogurt
y
2001 Nestlé fruit yogurt , Nestlé nan.1, Nestlé nan.2
y
2002 Nestlé everyday liquid
y
2003 Nestlé buddy, Nestlé hi-calcium low fat yogurt
y
2004 Nestlé raita, caution
KEY OBJECTIVES Build branded food improve quality of life by offering tasty, hygienic and nutritional products.
Marketing Management Philosophy
followed by the NESTLÉ
Societal Orientation / Societal Marketing
It is clear from the Haleeb Foods F oods Ltd. mission statement that the organization is not only selling products pro ducts to maximize its profit but also wants to provide a healthy and safe environment envi ronment to the community. They want to improve the quality of life of the community by providing quality food products at affordable prices.
NEED As the milk is been a basic need of every individual whether its an infant, a grown up or an a n old aged person, milk is a need of every one whether its in shape of plane milk or to be used in tea or coffee.
DEMAND As the people buying power is raising this want of packed milk is converted into demand of the people and as far as Nestlé is concerned it is a want of middle class and some time demand of the lower middle class.
WANT But now a days people are much more conscious about there health and hygiene so regarding the need of milk a want has come into being in shape of packed, pasteurized and ultra heat treated healthy milk.
VALUES y
Enterprise
y
Empowerment
y
Accountability
y
Team work
COMPETITORS As the Nestlé is market leader in milk producing so its keenly observe its competitor and try to improve its quality and variety of products day by day by doing continuous enhancement. Some known competitors of Nestlé are;
Haleeb Nurpur Engro foods Competitive Analysis
Major competitors include NURPUR& HALEEB
Others
are:-
ENGRO FOODS & raw & open milk sold so ld by Dodhi (milkman) Same prices of milk offered by them
Advertising:Media opted for:
Slogan:
Television, Bill Boards and Print Media. Good food, Good life
Theme:
MILK FOR EVERY ONE
Push VS Pull:
At some stores there is push strategy for the product where as at some stores its pull .
Promise & Support: BEST MILK FOR DRINKING & TEA. Value Preposition:
Best value for money.
Marketing Strategy Used:-
Penetration strategy supported by product differentiation
MICRO ENVOIRMENT Company in Nestlé the owner have no concern with the company operation all the decisions are taken by the board of directors and pass on to t o the subordinates.
Suppliers Company having their own milk collection centers in different sectors which not only take the milk from the farmers but also tell them about the modern techniques to improve the quality and quantity of m ilk. I ntermediaries ntermediaries
Company hire the private distribution and whole seller to provide its product nation wide and internationally company keep a strict check on its distributors company had appoint an area manager on each distributor to keep an eye on its performance
Customer Company keenly study the demand of the community as the poverty level leve l of our country is high and most of the people are not in condition to afford the packed milk so company introduce a milk which is packed but price is almost almost same to the open or loose milk.
Public As this one is a public company but not listed in the stock exchange yet Company is using both the printed and electronic media Company having keen interest in general public because they are the actual customer of the organization and try to design the product according to their expectations.
Diff erential Strategy Provide hygienic and nutritional products to the nation in an affordable price
Key success factors:
Quality Continuous System Enhancement Enhancement
low and affordable price
Competitive Advantage
Thickest & Healthiest milk
Differentiation Strategy
Functional
Selling Preposition Unique:
Thickest milk with standard price.
Segmentation & Target Market Demographically Gender wise & Income classes. Geographically
National and International market. Media Graphically
Electronic & Print media
Customers Profile Females House wives b/w the age of 25-35 SEC1& SEC2
MARKET SHARE
Market Share
3% 7%
6%
17% 67%
Nestle
Haleeb
Nurpur
Engro Foods
Empty
The total market share of Nestlé during the year 2005-06 is 67%; remaining portion is covering by Haleeb, Nurpur & Engro Foods 17%, 7% and 3% respectively.
Sales Daily sales: 400,000 liters Monthly sales value: Rs. 30 crore Annual sales value: Rs. 4.8 billion
Sales Growth rate
25%
This is changed 12% w.r.t last year.
Dividend:22.62% as per share.
Total Turnover:13.5 Billion Rupees. Beside this fact almost 6% market share remains empty. Because of some crucial reasons of infrastructure such as transportation transportation problem and other duties to deliver their products in far locations. Nestlé Pakistan is trying their best to meet this empty 6% portion, with the help of their sales promotion department which is doing very effectively job for the achievement of this object.
Nestlé Sales Turn Over Sales Turnover of Nestle' 12.9
15 10
9.1
9. 8
13.5
10. 7
5 0 2001- 2002- 2003- 200402
03
04
05
200506
year Amount in (Billion Rs.) In 2001-02 the sales turn over of Nestlé is 9.1 billions and it is increased by almost 0.7 billions more in the next year i.e. it reached to 9.8 billions in 2002-03.This booming trend keeps on increasing continuously in the next three years 2003-04, 2004-05 and 2005-06 which is 10.7, 12.9, 13.5 billions respectively. The sales turn over of last five f ive years is showing the continuous increasing trend and clearly representing the struggle of the management of Nestlé.
Nestlé With Co mpetitors
13.5
15
Billion Billion .)
10 2.7
5
1.2
0.5
0.3
0
Ne
e
a eeb
Nu
pu
ng o ood
O he
` In 2005-06, because of the major portion of Nestlé the market share i.e. 67% reached Rs.13.5 billio n .Beside this contribution of other four companies combinely cannot compete the overall sales revenue of Nestlé.
Organizational
Culture
Nestle has strong corporate culture which is reflected by the company logo itself. The logo, Good Food Good Life which is always attached to its products is the main guidance for every e very activity within the company. Nestle believes that good food is the primary source of good health throughout life thus it always puts nutrition, health and wellness as the core of its business. The company tries to further develop and emphasize on these aspects. These three things Nutrition, Health and Wellness can be found in a ll Nestle products and in the company mission statement as well. Talking about the company culture which is related its people structure, Nestle has the culture of team focused and open door policy which become one of its corporate strengths. The company focuses on collectivism and performance orientation orientation attitude to encourage employees to work harder (Ali (A li et al, 2009). Strategic Purpose
Marketing strategies No matter how effective the promotion and packaging, a firm will find fi nd it very difficult to market a product which fails to satisfy a consumer need. Kit Kat owes owe s much of its success to a unique dual appeal - as a fourfinger chocolate bar, (known in the confectionery trade as a countline), sold at corner shops and newsagents, but also as a two-finger biscuit sold in supermarkets. It is a product that has endured because of its wide appeal across the age ranges and to both sexes. Altering the actual product is potentially a very hazardous act for an established brand name as it risks altering the consumer perceptions of quality built up over decades. Tampering with the recognised core qualities could well damage the integrity of the brand. For Kit Kat, these intrinsic elements of the brand, or unique selling points include the: y
chocolate fingers
y
foil and band wrapping, unique in the countlines market and seen as an important feature which encourages involvement and sharing by consumers
y
well-known strapline - Have a Break, Have a Kit Kat. In spite of the risks of altering a ltering the product, the two finger bar and multipacks were introduced in the 1960s to meet the increased needs of supermarket shopping and more recently, Orange, Mint and Dark Cho colate Kit Kats have been available for limited periods. In I n the third week that Kit Kat Mint was available, it more than doubled total Kit Kat Sales. The Orange Kit Kat proved particularly popular with sales of 38 million bars in just three weeks. It provided very positive market research results. While they are seen as novelties, they can also be used to provide reassurance and reinforcement of the core attributes of the original established brand name. Special editions are used primarily as promotional tools. Market research has shown that consumers prefer special editions to be available for limited periods only and that consumers are likely to purchase the original Kit Kat at the same time or shortly after. (They are, therefore, a good way of injecting new life into i nto the Kit Kat product life cycle). Depending on their popularity, some special editions are introduced more than once. The Orange Kit Kat has proved so popular that the two-finger multipacks are now permanently available. Apart from these variants, the intrinsic characteristics of the Kit Kat product and packaging have changed very little during the last sixty years. Although some minor, subtle changes have been made in packaging, merchandising merchandising and sales promotions, a Kit Kat from the 1930s would be instantly recognisable to modern consumers today.
Pricing strategy A key advantage of maintaining a strong brand image in a competitive market is a degree of flexibility in the pricing strategy. It is a common characteristic characteristic of imperfectly competitive markets for producers to concentrate concentrate on non-price competition. When looking at the pricing strategy for Kit Kat, it can be seen from the figures that the real price has remained remarkably stable over the last sixty s ixty years.
Promotional strategy Nestlé has used a wide range of promotional tactics with Kit Kat. Promotion offers have included free bars in the multi-bar family packs and an instant win deal with Burger King in 1996. This promotion, where over 75 million free burgers were on offer, increased sales of Kit Kat by an estimated e stimated 30 In 1998, an on-pack o n-pack promotion featuring 'The Simpsons,' Simpsons,' with the chance to win £20,000 cash and hundreds of other prizes, increased sales of Kit Kat by a staggering 41 Advertising plays an extremely important im portant part in the confectionery industry, with spend approaching £114 million in 1996. The Have a Break, Have a Kit Kat theme appeared briefly in 1939, but has been the on-going y
Kit Kat slogan, or strapline, since the mid 1950s. 1 950s. Kit Kat's advertising is concentrated in two media: television commercials - which follow the well-known Have a Break tradition
y
posters - where the powerful colours of the pack and product are used to dramatise the message. A particular challenge for the advertisers is to appeal to both the consumers and the purchasers. Women account account for two thirds of all confectionery sales, but a large proportion of these purchases are subsequently consumed by children. Men eat as much as they purchase suggesting they are less generous!
Distribution strategy Nestlé has developed distribution channels which ensure the availability of Kit Kat to buy wherever and whenever the consumer wishes to purchase it. Sales of confectionery depend heavily on its availability, with market research showing that well over 60of all purchases are made on impulse. Consequently, Nestlé tries to supply as many outlets as possible - both wholesaler and retailer channels. Point of sale merchandising is also important when consumers are making instant, snap decisions from a wide range of products on view. Instantly recognisable packaging also helps to tempt customers. Shoe shops, for example, have recently been identified as having potential for confectionery sales owing to the large number of families that visit them. It is also predicted that confectionery, along with all foodstuffs, will become available through cable and interactive television, videophones and the Internet. Internationally, Internationally, Kit Kat is now also manufactured in Canada, Germany, India, Malaysia, China, Japan, Australia, South Africa and the United States. It is available in more than 100 countries throughout the World.
S.W.O.T ANALYSIS STRENGTHS 24 milk collection centers equipped with latest quality assurance laboratories. The only Nestlé Company in Pakistan that undertakes 21 rigorous quality control tests. The only Nestlé Company in Pakistan with the following Certificates:
y
HACCP (in process safety controls)
y
I SO SO
y
Tubular indirect heat treatment system from Holland.
ISO 9001-2000 (better quality)
14000 (environment friendly o perations)
WEAKNESSES y
Un CONVINENT PACKING
y
Unattractive and low media advertising
OPPORTUNITIES
There are number of milk importing countries like: like : y
Bangladesh
y
China
y
Hong Kong
y
Singapore
y
Thailand. Etc
THREATS Nestlé MilkPak, which is one of the largest and most influential milk processing outfits in Pakistan Haleeb, H aleeb, NurPur, and raw milk Gawallas. The whole Indian Nestlé industry because India is the largest producer of milk in the world. Rising exports of India.
Organizational
structure
CEO Chairman of the Board Vice Chairman of the Board Directors Honorary Chairman of the Board CFO CIO Communication Nestle Prof essional Executive Vice President USA, Canada & Latin America Nestle Waters Research & Development Operations
Pharmaceuticals & Cosmetics Marketing & Strategic BUs
Europe Asia Oceania Africa & Middle East Human Resources & Administration Nutrition Gover nance
& Secretary
Conclusion To put the pre-going discussion into nut-shell. It can saf ely be ventured to opine that Nestlé company has s much potential at that time but if Nestlé use the always diff erential strategy in proper manner we easily conclude that Nestlé will be able to lead the companies in the Pakistan and abroad.
Recommendations Transform the formula of milk because it gives a taste of powder milk Lower the price and reduce the packaging costs Conduct more advertising and change the style of add campaigns. Sachet pack should be introduced so that a poor man too can afford it.
