Cadbury

Prague College/ Teeside University

MSc International Management
Marketing Analysis of the Cadbury
Course title: Managing Marketing
Course instructor: Sylvia Vondrackova
Submitted by: Muhammad Umair

Contents
Marketing mix of Cadbury ............................................................................................................................ 4
Product ...................................................................................................................................................... 4
Product line: .......................................................................................................................................... 5
Price: ..................................................................................................................................................... 5
Place: ..................................................................................................................................................... 5
Promotion: ............................................................................................................................................ 6
Porters five forces ........................................................................................................................................ 7
Bargaining power of Supplier: .................................................................................................................. 8
Bargaining power of buyers: ..................................................................................................................... 8
Threat of new entrants: ............................................................................................................................ 8
Threat of substitutes: ................................................................................................................................ 8
Rivalry among competitors: ...................................................................................................................... 8
Market segmentation ................................................................................................................................... 9
Psychographic/behavioral segmentation: ................................................................................................ 9
Social media: ................................................................................................................................................. 9
Advantages................................................................................................................................................ 9
Disadvantages: ........................................................................................................................................ 10
Future Digital media strategy: .................................................................................................................... 11
Brand importance for Cadbury: .................................................................................................................. 12
Product brands under brand umbrella: ...................................................................................................... 12
Brand values:............................................................................................................................................... 13
Brand promotion: ....................................................................................................................................... 13
Sustainable resources: ................................................................................................................................ 14
Mindful snaking: ......................................................................................................................................... 15
Community Partnerships: ........................................................................................................................... 15
Critical analysis of Cadburys CSR initiatives: .............................................................................................. 16
Conclusion ................................................................................................................................................... 16
References: ................................................................................................................................................. 17

Abstract

This study is focused on the current marketing strategy of Cadbury and marketing strategy of the
organization is examined in detail that shows relationship between marketing strategy and
performance. It also covers marketing mix, porters forces and targeted market segment. Further
in the study digital marketing strategy with its positive impacts and disadvantages has been
discussed. Along with the branding initiatives that Cadbury took and how took advantage of
online branding and consumer engagement to enhance its brand value. Corporate social
responsibility projects are also highlighted with the suggestion to make them more beneficial to
the society.

Current marketing strategy

Chocolate has become a very famous snack in todays world and people consume it more than
ever, consumption of chocolate has been increased in last few decades. In a break if someone
wants to quench the hunger fast with nutritious snack, then the easiest solution probably will be a
chocolate. Cadbury the business actually started as a coffee, tea and hot chocolate business by
John Cadbury and later it becomes a joint stock giant by the passage of time.
Cadbury has grasped this idea quite well and has introduced a large product line according to the
different taste of its market segments; Cadbury seems to be the brand of chocolate for everybody.
With enriched nutritions and highest content of milk than any other chocolate in the market.
Cadbury is up with a new idea of personalized chocolate in its new products which is unique.
Cadbury is putting worthwhile efforts on its marketing strategies to effectively use all kind of
Medias and communicate its message to the consumers effectively.
Brand building is also Cadburys highest concerned aspect and its efforts toward building brand
and creating its value are discussed in the report. Increased demand of chocolate variant and
emerging markets for chocolate industry are the potential opportunities for Cadbury to grow but
ate the same time private labels available in market and reduced amount of cocoa available for
production of chocolate is alarming for the Cadbury but company has a capacity to backward
integrate and start farming for cocoa to fulfill its needs in future.

Marketing mix of Cadbury

Product
Cadbury ingredients include cocoa butter and there is a glass and half full cream. Cadbury buys
65 million liters of fresh milk each year to make Cadbury chocolates. Its products have similar
packaging design around globe. Cadbury also claims highest milk content in comparison with
other chocolate manufacturers. In addition to that Cadbury have product packaging of one bar to
whole family size package for the same chocolate.
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Product line:

Cadbury has a wide range of products so product line is quite big. They have a huge collection of
chocolate bars which have a plenty of flavors. Other products are Desserts, Ice creams, Biscuits,
bags & boxes and beverages, Cadbury is not only offering products that are on shelf for whole
year but also producing some occasional products for special events of Halloween, Christmas
and Easter.

Bars

Desserts

Ice-creams

Biscuits

Bags &

Beverages

Occasional

boxes

Some of products like Cadbury Dairy milk is quite classic and on PLC its stage is mature so
company is always putting huge investment in innovation of product and its advertisement
campaigns, for example now days latest advertisement on TV about Cadbury Dairy milk is
introducing it with some new flavors, packaging and they are also endorsing some celebrity to
boost sales.

Price:

Cadbury has the competitive pricing strategy in comparison with its competitors, although it will
not be possible for Cadbury to maintain the same prices in the longer run because raw material
costs hike up. According to Telegraph Cadbury is reducing the weight/size of products to cope
up with this matter. High Cadbury is operating internationally so they are using Market oriented
pricing strategy, uniform pricing cannot work out in case of Cadbury because 3 rd world countries
where people do not have high buying power they cannot buy the chocolate at the price which
Great Britain or other markets are willing to pay.

Place:

Cadburys headquarter is at the Cadbury House in the Uxbridge Business Park in Uxbridge,
England and its biggest R&D unit is Bourneville that is home to Mondelez's Global Centre of

Excellence for Chocolate research and development, so every new chocolate product created by
the company anywhere in the world starts life at the Birmingham plant. Cadbury products are
produced at different chocolate production facilities around the globe. After the chocolate is
processed and has experienced all the quality checks it is transported to the stockrooms. After
this Cadbury dispatches its products to shops that deal with refreshments and confectionery. And
then sell it to the targeted market segments. Cadbury produces chocolate for more than 200
countries.
Promotion:

Cadbury has a huge budget to design its promotions that enhance its sales, Cadbury never miss
any chance for its promotion no matter if its Christmas or Halloween. The major factor behind
this promotion is to increase the consumption of chocolate among masses.

Promotional mix

Although there are seven elements in the promotional mix but Cadbury is more focusing on four
of them because they make it right mix for fmcg products.
Advertisement:

Cadbury spends allocates huge budgets for its advertisement campaigns, for example in 2007
Cadbury launched its gorilla campaign to which marketing department of Cadbury allocated
budget of 6.2 million GBP that went quite successful and resulted in better brand perception. The
campaign leads to several other advertising campaigns including unwrap the joy etc.
Sale promotion:

Cadbury always have some different kind of sales promotions which lead toward the high
volume of sales. In 2009 Singapore airline was the first buyer of airbus A380s so Cadbury
launched a sale promotion like win a free trip to London, Tokyo, Sydney or Paris. There recent
sale promotions are unwrap the gold unwrap the gooless eggs and drive a mini

Sponsorship:

According to marketingmagazine.co.uk In Olympics the company decided to sponsorship for

sportsperson and Olympic game, they spent huge amount on this sponsorship and Cadbury
claims an increase of 2.5 million social media fans after this sponsorship.
Corporate image:

They have dedicated a website to their corporate social responsibility and corporate image to let
their consumers know what they are doing for the wellbeing of society except from making just
profits. The website is called www.dearcadbury.com on the website they have listed the the CSR
programs that they are currently working on and they beneficiaries include employees,
stockholders, supplier and the society.

Porters five forces

Bargaining power of suppliers

Bargaining power of buyers

(Low)

(Low)

Rivalary among
competitors
(High)

Threat of new entrants

Threat of substitutes

(Low)

(high)

Bargaining power of Supplier:

Suppliers have relatively low bargaining power due to diverse network of Cadbury supplier and
it will not much affect the Cadbury to switch to other supplier, Cadbury is using economies of
scales production formula so inputs will not effect that big on the production and at cost of
finished products. Cadbury is huge multinational brand and it will not be a big challenge for it to
backward integrate to produce supplies for it.

Bargaining power of buyers:

Bargaining power of buyers will be relatively low because of large number of buyers in market
and Cadbury has been successful to create value for its brand so it will be hard for distributors to
bargain for the price due to high demand from end customers

Threat of new entrants:

Threat of new entrants is lower because entry barriers are high due to huge requirement of capital
to be in the business and sunk costs are also very high. Cadbury brand image also give a shelter
to Cadbury, customers are loyal to their beloved chocolate brand in addition Cadbury has a very
strong distribution channel that will be a really tough and daunting task for a new entrant to build
such an efficient distribution channel.

Threat of substitutes:
Threat of substitute is relatively high because there are other strong chocolate brands like Mars,
Hersheys and Nestle which are offering similar products so customers can easily switch to them.
Some big hypermarket chains are also offering their own brand chocolate which is available at
relatively low prices.

Rivalry among competitors:

Rivalry is high among competitors everyone is struggling hard to take the biggest pie of the
market share but somehow Mondelez has managed to be on the top with the highest market share
in the confectionary industry.

Market segmentation
Psychographic/behavioral segmentation:
In developed markets Cadbury has three consumer segments which are based on Consumer
lifestyle and consumption that include impulsive buying, take home and gifts. Impulsive buyers
usually buy it for consuming it right away for example single bar. In supermarkets bigger
quantities are sold to take home these sales are usually driven by needs. Gifts are usually
dependent on the occasion it can be a birthday, Christmas, Halloween or Easter.

Digital marketing
Cadbury is the most famous chocolate brand in the world so its marketing team knows how to
find innovative and fun ways to deliver its message to its consumer and digital marketing is
another tool for them to take consumer engagement to the next level. Cadbury run its digital
marketing campaigns through Facebook, Google+, twitter and YouTube. Cadbury has done
many successful digital and social media marketing campaigns.

Social media:
In 2012 Cadbury ran a campaign on Social media called thanks a Million that was specially
dedicated to the Cadbury fans all around the world on reaching there fan following toward one
million. This campaign started with building up a huge like thumb made up of chocolate and
they had a live video stream of its building and team was actively responding to the comments
and suggestions of fan. Fans were encouraged to come to this place and put their own piece of
chocolate to build it up and it was a very thoughtful idea of consumer engagement and making
them realize their ownership in the company. Campaign was quite successful because it brought
40,000 new likes on the Facebook page within 48hours and more than 350,000 got involved.

Advantages

Consumer engagement
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40,000 new fans

Active communication

Disadvantages:

Huge budget

Only 30% of fans could see the content Cadbury was posting

On April 28 2014 launched a new online campaign for Dairy milk which flavor do you favor
this will be the biggest ever online campaign from Cadbury they say. In this campaign they are
rebranding Cadbury dairy milk and moving away from the Joyville brand idea toward the
introduction of new brand that will be more focused on the flavor concept. Cadbury dairy milk
will be introduced in new flavors Cherry Ripe, Picnic, Strawberries, Black forest, Cream and
Crackle. They will be asking their customers to claim their flavor and take part in the brand
activation on Facebook; content created by customers will also be included as a part of this
campaign.
A Marketing research agency GfK NOP released the results of a study that evaluated the inter
media performance of Cadburys recent campaign. study shows the strength and the power of
online advertising and its capability to deliver massive returns on investment. Cadburys Dairy
Milk campaign was evaluated by using the Media Efficiency Panel, a joint venture in the UK
between GfK NOP and Kantar WorldPanel. This research also shows that YouTube was the
most effective medium for social media marketing campaign; advertisement on YouTube
generated four times more ROI than other social mediums. The research didnt imply that the
YouTube replaces the TV ads wholly but YouTube and TV ads complement each other.
Cadburys major focus is on Facebook pages of its products, Twitter and Google+ seems to be
ignored by the digital media team because on Facebook they have over a million of fans but in
contrast on Google+ they have just some hundreds, on twitter Cadbury is not actively responding
to the tweets all posts show up on twitter are mostly tagged by other people which are not
responded most of the times. By doing so Cadbury is not maintaining it proportionality on social
media and might lose potential and existing customer in future.

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Future Digital media strategy:

Cadbury achieved a big success in it digital marketing and claims highest ROI in digital
marketing campaigns in comparison with any other media campaigns after these consecutive
successes parent company Mondelez has decided to allocate 50% of its media budget into digital
advertising that will be quite huge in numbers. Mondelez has be implementing strong and
aggressive digital marketing campaigns, Cadburys digital media campaigns also come under the
same umbrella.
Although they have the best digital marketing gurus in their teams but still allocating such big
budget to digital media marketing is still a question mark, it can be quite risky and organization
is totally underestimating the technology because we have no idea what kind of innovative and
better technology scientist can come up in 2016 plus by investing such huge investment Cadbury
will be just focusing on a specific market segment that includes teens and some middle aged
population what about the rest of market segments? Before making this strategic move they must
think of the following factors:

Digital marketing campaigns can be copied easily no matter how innovative they would
be.

May be in coming days digital marketing get diminished by abuse of ad clutter

Digital marketing is highly technology dependent which is prone to errors

Digital media marketing is still not embraced by everyone

Brand
Researches have proved that Brands are the most valuable assets of a company; it goes a long
course of the time to develop a brand some time even centuries. Cadbury as a brand name came
from its founder John Cadbury who started this business as a tea, coffee and hot chocolate
seller. Logos also play vital role for the recognition of brand as Cadburys logo tells about
product, its contents, manufacturer and attracting a customer to purchase product as well. The
tagline glass and a half of full cream milk in every half pound slogan with the picture of milk
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pouring into the chocolate bar was first introduced in and now it is the part of Dairy milk identity
so the Cadbury claims highest milk content in its chocolate comparison to all others. Script or
font Cadbury uses for its trade mark is is corporate identity and customers recognize it as well.
Last but not least Cadburys packaging for different products have become identity for
themselves and this is how a whole brand is generated by the right mix of all elements discussed
above.

Brand importance for Cadbury:

Now whenever a consumer will see the purple packing of the chocolate he/she can easily
recognize thats Cadbury. Its nothing special about that purple color but it took them more than
a century to make it signature color for the Cadbury in the mind of customers that is the actual
value of that color for company. After four year of legal fight in courts with Nestle. At last
Cadbury won the legal rights to use their shade of purple to use exclusively on their milk
chocolates and drinks. It sounds funny that why a multinational company would be putting such
a huge effort to secure just a shade of color, but this is really sensible move because of Cadbury
recognition by its customers.
Supermarkets have their own low cost brands which look quite similar to real product and low in
quality so customer are fooled sometimes by this way but Cadburys sales will be intact.
Customer also associate themselves with brands and they are always willing to a little high price
for a known brand instead of paying a low price for some brand that they never heard of and
dont know how worst the quality of product will be. Brand Recognition is a key aspect of the
corporate identity development. Organizations that strongly emphasize on brand identity
undoubtedly have a strategy for brand recognition.

Product brands under brand umbrella:

The Cadbury brand has a high impact on individual product brands. Brands have their own
individuality like a separate personality aimed at different market segments for specific needs,
for example, TimeOut is an ideal snack to have with a cup of tea. These brands enhance benefit
from the Cadbury parentage which includes quality and taste benchmarks. It ensures the success
of product brands in every focused aspect of the parent brand. A Flake, Crunchie or TimeOut are
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totally different and are produced to appeal a variety of consumer segments. However the
strength of the brand umbrella supports the brand value of each chocolate bar. Consumers know
that they can trust chocolate bar that carries Cadbury trademark.

Brand values:
Whenever we go out to buy a new pair of trainer shoes its really hard to make a practical
decision on the choice we will always buy on pair from one of the top notch sports brands
because we consider in our mind that the brand logo on them will communicate certain value to
other people. Cadbury adjusts its advertising strategies to reflect its values in different markets.
These variation are wide ranged that includes, increasing brand awareness, informing about new
products to potential customer, increase seasonal sales and currently cadbury has launched its
new campaign called which flavor do you favor which shows the positive emotional value of
brand.

Brand promotion:
In 2011 Feb, Cadbury designed a marketing campaign in which consumers splits into two
teams, Spot or Stripe, with this campaign Cadbury effectively made another community of brand
devotees. Customers could go online and play games directly via the community to win points
for their team or they could collect points in other ways. For example, a customer could have
won points by using secret codes printed inside the wrapper of some of Cadburys most popular
bars. The 6.5m campaign marketing spend, part of an overall 50m invested by Cadbury in the
'Spots vs Stripes' initiative, it is split between TV advertising, digital, events, community
programs, PR and outdoor advertising. With this interactive campaign they wanted to realize the
consumers their ownership of Cadbury.
In 2013 before valentines day Cadbury introduce a new campaign in which customer were given
the option to put text of their own choice on the Cadbury chocolate wrapper in addition to that
they can also put some photo over it. Even when customer has consume the chochlate he/she
wouldnt throw its packaging away because it was the words of their loved one on it and
Cadbury will stay there with that wrap forever.
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Corporate social responsibility:

Cadbury put much emphasize on corporate social responsibility (CSR) and doing business
activities in ethical manner, why are they are putting that much emphasize on CSR? Answer is
very simple, there are two major reasons behind it, first corporate social responsibility is crucial
for Cadburys long term sustainability and survival, and secondly Cadbury is covered about the
whole society. They want to be a really responsible business company who is not just worried
about maximizing their profits and achieving their business goal but also pondering to be a
partner of a healthy growing society. Cadbury has dedicated a website for its corporate social
responsibility projects that are currently going on, link is below
http://www.dearcadbury.com

Sustainable resources:
Cadbury rely on the fact that sustainability preserve the world and people because of dependency
on just one planet with limited resources. Its not just important for the Cadbury but for every
human being living on this earth so Cadbury is trying hard to cut down the usage of energy,
water and other resources in addition to that also finding ways to reduce the amount of waste.
Following are some goals that are meant to be achieved by 2015:

Cut down energy and water usage in manufacturing by 15%

Cut down greenhouse gas emissions and waste from manufacturing by 15%

Utilize 60% of landfill sites for production.

Reduce 22,500 ton of packaging material

Empowering farmers and giving an improved lifestyle to more than 1 million people.

Create A million of coffee entrepreneurs.

European wheat program called Harmony, promotes biodiversity and worthy

environmental practices in wheat production.

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Mindful snaking:
Cadbury is concerned about the growing percentage of obesity or overweight people. According
to stats by now 1.6 billion people are overweight or obese and more than 60% of world
population doesnt do 30 minutes of exercise to maintain a healthy lifestyle. Cadbury alone
cannot fight this problem alone so it has engaged non-governmental, inter-governmental
organizations, civil society, governments and companies to amplify the idea and bringing back to
the life. Cadbury is working on it product portfolio to enhance the effect of well-being following
is some measures that Cadbury is taking into account for it:

Reducing sodium

Cutting out the fat

Filling the Whole Grain Gap

Placing calorie label front of pack on all relevant products

Community Partnerships:
Cadbury partnering the communities, make a positive impact on world and promoting active,
healthy lifestyles. Cadbury is doing it for a long time, over past 25 years it has invested over 1
billion USD and ramping up our efforts to empower families and communities to lead healthier
lives. Cadbury is running different type of programs around the globe to create awareness among
different age groups to enhance the effect of its philosophy.
Brazil: INMED Partnerships for Children's "Heath in Action" is a school-based system to
instruct kids and their families about good nutrition, healthy lifestyle practices and preventive
health, cleanliness and sanitation measures.
China: Youth Development Foundation has created Hope Kitchens to help to improve the
nutrition of food served to students.
Germany: Klasse2000 is an award winning healthy lifestyle program that has benefited more
than 1 million children, teaching vital knowledge about nutrition, the importance of physical
activity and other valuable life skills.
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Cadbury is running similar kind of wellbeing programs in Italy, Russia, Spain and UK.

Critical analysis of Cadburys CSR initiatives:

Cadbury claims in its CSR initiative called empowering through information that they dont
advertise their products to the school going children and on the other hand they are producing the
products for children that have a very high content of fat, Cadbury has decided to cut down its fat
ingredient in chocolate in the long run but have not been implemented yet.
Another program that is called mindful snaking is the program to educating school going
children about the right diet but this program and its different variants are running in German,
Brazil, UK, Russia and Spain. Comparatively all these countries need this kind of program far
less than the countries situated in the 3rd world.
All community partnerships of Cadbury are wither in developed world or in the emerging
markets which are potential growth areas for Cadbury, but Cadbury could take a initiative about
the children dying in Africa due to hunger or living in deprivation of basic needs.

Conclusion
Cadbury is the leader in the confectionary industry and has successfully enlarged its target
market by making huge number of products according to the needs of consumers. Company
completely know how to use its available resources effectively to achieve its sales goals but it
need to work on its weaknesses and turn them into its strengths to eliminate the potential threats
that Cadbury can face in the future.
Cadbury is doing quite well on digital media marketing in fact they are doing it better on digital
media in comparison with other media, and planning to allocate 50% of its marketing budget in
digital media but over reliance on digital media can be fatal and by doing so they will be
focusing a specific target market group. As far as branding is concerned Cadbury is quite
successful in the mission of its brand building and creating value of it for the end consumer.
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Combining the business efforts with corporates social responsibility makes Cadbury the perfect
confectionary on the earth but there are still so many improvements that Cadbury can make on its
journey at the road of success.

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Strategies (Boston, MA: Houghton Mifflin Company).
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1998.
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Citizenship and Sustainability in the Age of Globalization, Oxford: University Press.

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