Mondelez renovates to stay young, healthy ‘Itisnotallaboutsugar’
With brand extensions, product innovations and an omnichannel strategy, the company looks to recruit new customers and hold on to old loyalists
No brand can afford to give up recruiting new consumers, especially a 70-year-old entity that faces a strong pushback from millennials over the health effects of a product that forms the core of its identity in the country: Chocolates. Mondelez India MD Deepak Iyer is not too worried, he says, as there is more to the category than sugar. But that does not mean the brand is complacent. The company is always looking to recruit new customers and to that end the brand is constantly evolving, using the intimate knowledge it has of the Indian customer and her changing preferences.
“A chocolate is also about milk and cocoa and who can dispute the health benefits of that,” Iyer says as he adds that the Mondelez portfolio also has Bournvita in the health drink market. Evidently these are the principles around which the brand is crafting its identity for a young group of buyers in the country, emphasising health, quirkiness and joy over fun and indulgence as core values.
With an eye on the changing shopping habits of the young, the company is also shoring up its digital strategy. It has an alliance with Amazon India because e-commerce opens new avenues for consumption and gives the brand doorstep access. “It increases the basket size and gets us into households,” Iyer explains.
With the brand going digital, how does it handle being in the spotlight 24x7? For Cadbury that faced a big problem in 2003 when worms were found in a bar of its chocolate, this is a big risk. “We have SSMTs (special event management teams) created to manage any crisis. These teams are small yet powerful, embedded in the country as well as globally and work 24/7,” Iyer says.
The Mondelez portfolio in India includes brands such as Cadbury, Bournvita, 5-Star and such others that have a high recall, offering the company a strong perch to launch its future growth plans from. The company says it knows what works in the country; Cadbury Dairy Milk was developed to suit the Indian palette. Fuse
From luxury to an indulgence to an unhealthy snack — how does a brand like Cadbury tackle changing customer perceptions about chocolate?
Chocolate is not all about was jointly developed by Indian and global laboratories, but launched in India as the pilot for the world.
While Cadbury is a legacy brand and the company is not tampering with its taste, it has been experimenting with pack sizes and extended the brand into allied products. “In March we launched Cadbury Dairy Milk lickables, our foray into liquid chocolates,” Iyer says.
Mondelez claims it has 65 per cent of the chocolate market share, which has been growing in low double digits for the past five years. To push the numbers up faster, it will need to reach out to a wider network of customers in terms of their demographic and geographic profiles. “We have invested significantly in our sales and development network over the past five years. Our products are available in nearly 2.5 million outlets, we have 300,000 chillers and sugar, it is just as much about cocoa and milk. And we all know their benefits. What would life be without any sweets in India? In a way, we play at creating these moments of joy. It’s not like everyone is eating a huge slab of chocolate. Per capita consumption in India is just 100 gms per person, way below the developed world.
How do old brands stay relevant?
Cadbury is the original directly supply 40,000 villages. We want to expand our rural network,” Iyer says.
Mondelez also keeps an ear close to the ground for brands that have not hit the sweet spot. For instance, Bournville, the dark chocolate brand went through several trials before locking down the right sweetbitter ratio. “We did a fair bit of consumer research, not just on sweetness, but also in terms of packaging and formulation. This is part of what we call brand renovation,” Iyer says.
The company classifies its portfolio as premium, mainstream and affordable. Premium includes larger bars with a lot of flavours. Affordable is for new recruits. “Anything below ~10 would be affordable, anything above ~50 would be premium and mainstream is anything in between,” Iyer says. And that is how the brand keeps all bases covered. chocolate in India. There have been innovations, the first aerated chocolate was the Silk Bubbly, the first centre-filled chocolate was Silk Caramel and so on.
What is the brand’s digital play?
The retail landscape has changed. We have e- commerce which is changing shopper behaviour. Today, a shopper can choose to buy from traditional, modern trade or e- commerce. All three channels are salient, important and will remain for years to come. As a company, we need to be omni channel enabled. # 2812