In India, Cadbury was synonymous to chocolates for decades. But, over the last few years competition has increased with companies like Amul, Nestle, Ferrero and off-late even Hershey taking on the maker of Dairy Milk chocolates with new products, innovations, and big marketing push.
Mondelez International, which owns Cadbury, on Wednesday opened a new global research and development and quality (RDQ) technical center in the country as it looks to focus on innovations in chocolates and beverages as well as focus on the wider snacking category over time. India remains among the fastest growing businesses for Mondelez and the company is keen on strengthening its leadership here. The company has 66 percent share in chocolate category in India and a market share in mid-to-high-teens in the cocoa beverages category, where it sells Bournvita.
“This R&D center is very well placed to bring the best of local and global trends and to make sure our innovation pipeline is stronger. India is a very important market for us. As a company, we will continue to invest in India in our business, not only in R&D but in manufacturing, in marketing, in route to market, people and obviously communities to make sure we continue to sustain the wonderful growth that we are having in this place,” said Maurizio Brusadelli, President AMEA (Asia, Middle East and Africa) at Mondelez.
Mondelez has invested $15 million in the RDQ center in Thane near Mumbai and this will be the company’s tenth such center in the world. The other centers include New Jersey in the United States, Curitiba in Brazil, Bournville and Reading in the United Kingdom, Wroclaw in Poland, Singapore, Suzhou in China, Saclay in France and Munich in Germany. The India RDQ center will be the only one, apart from the one in Bournville, to focus on chocolates. It will also be the only center to focus on beverages, other than the center in Curitiba.
The new RDQ center in India comes two years after Mondelez opened its largest chocolate manufacturing plant in the Asia Pacific region in Sri City, Andhra Pradesh, two years ago.
“India is one of our highest growth markets in the world and it is the country with our highest chocolate market share in the world. Our technical centers will drive agile innovation and cost and productivity improvements as we address an ever-evolving consumer landscape,” said Tim Cofer, chief growth officer.
Through the RDQ center, Mondelez wants to innovate and strengthen its existing categories like chocolates and powdered beverages like Tang and Bournvita, but the company is also looking at a wider snacking footprint in India.
“We are, I think, the world’s greatest chocolate company, but at the same time, we have offerings in beverages, biscuits, in bars etc. There is an opportunity in this country to continue to evolve our portfolio. We are proud to be a chocolate company and will continue to make that offering. But, we will look to explore our offering as well into other adjacent categories that provide more central wholesome offering as well,” said Cofer.
Per capita, chocolate consumption at 100 gram per person in India is significantly lower than the 5-10 kilo consumption in developed markets. The company is now using data analytics as it looks to expand its distribution across India’s vast hinterlands.
“The challenge is not that the consumer does not have the money. He has the money, but the challenge is how to reach him and in an economically sustainable manner. Doubly compounded for a chocolate company like ours, because then you need to have a cold chain. Today, you have the technology available to solve this,” said Deepak Iyer, MD, Mondelez India.
Helped by use of big data and e-commerce firms, the company now covers 50,000 villages, compared to less than 15,000 just three years ago, added Iyer.