Cadbury India : A fight to worm rumour, problem situational analysis, solution, result and conclusion

1. Cadbury India : A fight to worm rumour
By:
Mustahid Ali
MBA-3
ROLL NO: 1334

2. ABOUT COMPANY
 In 1824, John Cadbury began selling tea, coffee, and
drinking chocolate which he produced himself at Bull Street
in Birmingham, England.
 He later moved into the production of a variety of cocoa
and drinking chocolates, made in a factory in Bridge Street
.
 John Cadbury became a partner with his brother Benjamin
and the company they formed was called ‘Cadbury Brothers of
Birmingham’.

3. Cadbury Product Portfolio

4.  Sell three kinds of confectionery: chocolate,
gum and candy
 operates in over 60 countries.
 35,000 direct and indirect suppliers.
 187 years old.
 45,000 people are employed.

5. Company Analysis

10. PROBLEM CONT……………
 In eight outlets across Maharashtra, worms were found in
some bars of Cadbury Dairy Milk.
 Inquiry was instituted by the Food and Drug Administration
and negative media publicity spread like wildfire.
 Consequently, sales volume plummeted, retailer cooperation
lessened and employee morale dwindled. All in all, the
company's credibility suffered extensive damage

11.  Reputation and credibility was under intense scrutiny.
 Sales volumes came down drastically in the first 10 weeks.
 Employee morale – especially that of the sales team – was
shaken.
 Due to which media coverage touched close to 1000 clips in
print and 120 on TV news channels.
 People even assumed that every chocolate could be
contaminated.
Crisis

12.  Cadbury India Ltd. has begun investigations into reports
that live worms were found in its Dairy Milk chocolate bars.
 Cadbury’s statement : We are concerned about these reports
and are investigating it," a company spokesperson said.
 The Maharashtra Food and Drugs Administration (FDA) had
announced that it would prosecute Cadbury India Ltd. after
tests indicated "insect infestations" in the chocolate
samples tested.
Problems faced by Cadbury

15.  To Restore confidence in the key stakeholders.
 Build back credibility.
 Make customer believe about safety.
 To increase the sales.
Challenges

16.  In response to the crisis, Cadbury therefore developed
three key messages:-
1. Infestation was a storage problem;
2. It was safe to eat Cadbury chocolates; and
3. Consumers must exercise the same care in purchasing a
chocolate as they would when buying any food item.
Objectives

17.  They did not deny the fact of worms being present in the
chocolates
 Project Vishwas
 Advertisement featuring Amitabh Bachchan.
 Revamping of packaging of Dairy Milk having metallic poly
flow.
Steps taken by Cadbury to achieve the objectives

18. Using IMC elements to overcome from
this problem
• Advertising
The company began its multi-pronged campaign on key print,
broadcast and electronic media, to regain its lost credibility and
almost reestablished the category.
• Message strategy
It decided to convey that the root of the problem was as the
distribution end, that any food item could face similar infestation,
and yet Cadbury would take initiatives to check the problem.

19.  Identification of four stakeholders the consumers, its
employees, the media, and the government authorities (i.e.
the FDA)
 Situation with FDA would improve as the company was
strictly adhering to food safety laws
 Attention from media would fade as media would lose
interest and find other stories to cover
What & How to be Done?

20. Internal Actions
Implementation of Actions
 Letters from MD to the
employees
 Employees were asked to go
to the markets and check for
themselves
 Series of town hall meetings
were held
 Regular email updates
External Actions
 Packaging
 Project “Vishwas”
 Two advertisements featuring Amitabh
Bachchan
 Media conferences
 Platform of BQC
 Retail monitoring and education
program
 Toll free numbers and emails to the
retailers

21.  A plan involving distribution and retail channels to ensure
the quality of products.
 Quality control managers and 300 sales staff checked over
50,000 retail outlets in Maharashtra and replaced all
questionable stocks.
 Built awareness among retailers on storage requirements for
chocolates.
 Provided assistance in improving and strengthening
packaging of company’s range of products.
Project VISHWAS

22.  Appointed as brand ambassador for a period of two
years.
 The company believed that the reputation he has built up
over the last three decades complements their own, which
was built over a period of 50 years.
 AB played a pivotal role in all communication relating
to Cadbury's products and brands.
 Aimed at rational and emotional appeal
Why Big B?

24.  Infestation was Storage-linked problem, not
manufacturing related.
 Sales volumes climbed back.
 Responsiveness of company.
 Significant upward movement in ratings
 Within eight weeks of the introduction of
its new packaging and advertising campaign,
sales had almost reached pre-crisis levels.
 Cadbury has maintained its position at the
top of the Indian chocolate industry ever
since.
As A Result:-

25.  Through timely and consistent marketing communications
Cadbury succeeded in solving a daunting business crisis.
 With a 360-degree communications approach that targeted
various audiences, Cadbury could quickly control and off-
set the negative word of mouth it had received.
 By integrating a variety of tools like press release and
conferences, consumer advertising, trade advertising,
point-of-purchase communications, packaging initiatives,
email communications and the like, all focusing on the same
problem, Cadbury could communicate a unified message and
get audiences to appreciate the efforts it had taken to
minimize instances of future occurrences.
Conclusion

26. THANK YOU
….AND
THEN
THEY
SOLD
HAPPILY..!!!!