Cadbury India faced a major blow late last year when some of its chocolates were found infested. To mitigate the problem Cadbury started a three point retailer agenda which included education on storage, providing infrastructure and no questions asked replacement policy. Project Vishwas was also introduced.
In its attempt to win back its lost consumers and their trust, the company has now announced new purity sealed packaging for Cadbury Dairy Milk. AS per Sanjay Purohit, General Manager, Marketing, Cadbury India, “Though most of the retailers take good care of the way the chocolates are stored, a few might store them under unhygienic conditions. Hence, we are further strengthening our packaging.” He added that Cadbury Dairy Milk packaging was already of international standards.
The new packaging for small dairy milk bar (13 gm, priced at Rs 5) is double wrapped for maximum protection. The chocolate is locked in aluminum foil and enclosed in a poly flow pack completely sealed on all sides. The larger dairy milk packs will come in ply-coated aluminum foil, which will be heat sealed and then wrapped in branded outer package.
New packaging for smaller packs is already available in Maharashtra. The process of introducing new packaging for all the sizes, through the country, would be completed in next six weeks.
States Purohit, “Such packaging does not exist in most parts of the world and it is for the first time that such a packaging is being introduced in India for molded bars. We are providing double protection for twice as much reliability.”
Realising that it was not only important to improve the packaging but also to communicate the same to people in the shortest possible time, Cadbury has roped in Amitabh Bachchan as the brand ambassador. Bachchan will promote and endorse Cadbury chocolates for a period of two years.
Bharat Puri, Managing Director, Cadbury India, says, “There is a perfect fit between Amitabh Bachchan and Cadbury Chocolates. Their timelessness and the love and trust they both share with people across India make this an ideal partnership.”
Answering the questions as to what was the financial impact of introducing the new packaging Puri stated, “It impacted us financially both from loss in sales point of view, as well as due to investment in new packaging. Rs 12 to 15 crore is the capital investment in new machines, and new packaging is 12 -15% more expensive.” However at the moment the company has no plans to increase the price of CDM bars as the attempt is to bring back volume growth in the category.
When asked about the losses Cadbury incurred due to the infestation controversy, stated Puri, “There was negative growth in the months of October and November. Retail audit by ORG MARG indicates that the category went down by 3% in October and 9% in November. Fall in Cadbury sales has been much lesser than the category average. Though retail audit data for the month of December is not yet available, every week in December has been better than the previous week. However, in annual sales we might see a 3 to 5% fall. It is a major fall considering that we were growing in double digits before that.”
Should the company not have changed the packaging before the problem occurred, one might wonder. “There was no provocation for us to change packaging. The same packaging was being used for last 30-40 years without any inkling of any problem. We have taken an immediate step as soon as there was a problem. We are a company that places consumer before everything else.” explains Puri.
As to when does he see the lost consumer coming back to the Cadbury fold, Puri states, “In January to March, we are expecting the numbers to come back to its original sales barring perhaps the states of Maharahstra and Kerala.”