Nestle Chocolates

Indian Chocolate Market

• Valued at Rs 750 Crore• Growth stage in PLC• Huge untapped market- penetration just

5%• Chocolates still viewed as an indulgence• Cadbury 70%, Nestle 24%, Amul 3%

Pune chocolate market

• Valued at 1.5 Crore, 12,000 retail outlets• Cadbury 85%, Nestle 8%, others 7%• SKU’s priced below Rs.5 account for 60%

of sale• Dairy milk 40%, Perk 10%, 5 star 10%,

gems 5%

Nestle

• Chocolate sales – 346.51 Rs. Crore• 24% market share• Chocolates 13-15% of total revenue• Product range includes Classic, kit Kat,

Munch, Choco stik, Bar one

Nestle SWOT Analysis• Strengths-

– Parent support– Strong distribution network

• Weakness– Raw material supply – volatile prices– Chocolates - comparatively small business unit

• Opportunities – Low penetration, consumption;– Launch of brands from international portfolio?

• Threats– Foreign imports

Cadbury

• Chocolate sales of Rs 514.03 Crore• Market leader by far – 70% share• Dairy milk alone accounts for 30% of

market• Other power brands include Perk, 5 Star,

Gems• Targeting youth and adults through new

products

Amul

• Shifted focus in 1990’s towards other milk products. Market share down to 2-3%

• Launched in recent years 6 new brands• New brands centered on specific

occasions/ festivals• New brands are also targeting a specific

age group each

Marketing Mix

- Nestle Chocolates

Product

The chocolates have a wide range to suit different targeted segments

• Variety – Classic, Munch, Milky bar, etc.• Design – Plain bars, filled, chocolate

covered wafers, • Large number of Brand names• Sizes and Packages – wide range to suit

key price points and occasions

Price

• Pricing – In line with Cadbury’s offerings• Incentive schemes – eg. Maha munch give

more value for the same price• Priced at key price points like Rs.5

Promotion

• Brand ambassador- Rani Mukherjee for munch ( targeting youth)

• ADVERTISING– Decreased dependence on children’s TV

channels over recent years– 33% of total industry spend but near equal

spend on each brand with rival offerings from Cadbury.

Place

• General FMCG distribution structure.• Strong coverage in urban areas,

developing in rural.• New Regional Sales Offices to increase

width and penetration and focus in rural areas.

Types of competition- Nestle chocolates

• Brand competition - Cadbury, Amul,• Industry – sugar boiled (Parry’s, Perfetti)• Genre – Ice creams, sweets, cream

biscuits• Form – Greeting cards, Balloons, other

snacks

Market segmentation

Demographic• Age – children, youth, adults• Urban/ruralPsychographic – (Higher end segment)Usage rate – (Family pack segments)

Perceptual Map

STRATEGY

BCG Matrix

GE MODEL

Porter’s 5 point analysis

• New entrants – imported brands• Substitutes – As chocolates are viewed as an

indulgence, low threat from snacks• Buyer power – Low buyer power since quantity

purchased is small, threat in future from organized retail

• Supplier power – No threat of forward integration, but volatile prices of key inputs

• Competition intensity- 2 players control 95%

Thank you• Nishant Betgeri (9860176449)

nishant.betgeri07@sibm.net• Priya Bhatnagar (9890860299)

priya.bhatnagar07@sibm.net• Writa Bhattacharjee (9860367205)

writa.bhattacharjee07@sibm.net• Yogesh Chandorkar (9860318261)

yogesh.chandorkar07@sibm.net• Shloke Churiwal (9860350892)

shloke.churiwal07@sibm.net• Farhan Farooq (9822416727)

farhan.farooq07@sibm.net