Friday, April 5, 2013

Kraft Foods draws aggressive plan for Toblerone in India

English: A Cadbury Dairy Milk chocolate bar, f...

With Kraft taking complete control of the Cadbury India operations, the US chocolate maker is now making a move to take its flagship premium chocolate brand Toblerone mass in the country. The company has tied up with leading organised retailers such as Reliance Retail to run promos on its large pack size offerings where it has cut prices by as much as 50 per cent on its MRP, said dealers and retailers.

Cadbury India has recently slashed the price of Toblerone’s 400 gm pack from Rs 430 to Rs 250. The price of Toblerone’s 200 gm is reduced to Rs 150 from Rs 250. “Cadbury is running this scheme to increase its sales of Toblerone and take on other premium chocolate brands,” said a dealer involved with Cadbury India. An email sent to Cadbury India did not elicit any response.

“This move would help the company in the short-term to garner sales volume. But it may be difficult to sustain this for long,” said Jagdeep Kapoor, chairman and managing director of Samsika Marketing Consultants.

The company had recently introduced special discounted price for its premium cookie and cream category — Oreo biscuits. Oreo packs were available at lower price points of Rs 5, Rs 10 and Rs 20.

Experts feel the mass-market strategy of Toblerone from Cadbury India can change the market dynamics and will increase average selling price of the category. “This is called devaluation of brand at the alter of price,” said Harish Bijoor, CEO of Harish Bijoor Consults.

Cadbury’s premium chocolates brands such as Bournville, Dairy Milk Silk have been facing competition from players such as Ferrero, Lindt, Nestle, and Amul. Cadbury’s rivals have been reducing prices and focusing on local manufacturing to gain market share.

Industry experts say Toblerone’s premium pricing strategy is because it is the only imported brand in Cadbury’s portfolio. The demand for premium chocolate category is growing on the back of increasing preference for international chocolates, added experts.


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