The Kraft Cadbury purchase for India/China | Advantage Brands
March 4, 2010 3 Comments
Well, that’s what we called it in India, but overall the global Cadbury’s portfolio has a lot in it for Kraft..
In India however, Kraft just has a sales rep office in Gurgaon selling Tang, Oreo and Toblerone in online marketplaces and hyper-/shopping malls. India continues to source Kraft cheese and even Toblerone from the Middle East and at a $1 price for Oreos and Toblerone, it is restricted to urban lifestyle markets ( Check out this rediff story, nice detail)
China is however a different story as Kraft already has a double digit market share in th country (however, Cadbury’s share in India is more than 50% and that of the top competitor in China also in the higher 20s or some 30s %age. Kraft is a happy buyer at $300 million and with Unilever candidate and expat Sanjay Khosla leading the International effort for Kraft ( $11bn in 2007) it may have been a different story. Apart from putting the new combined structure on the ground which could take some years, Kraft could use the ready Cadbury / ven Nestle & Unilever distribution ( there are no exclusive partnerships or zones in confectionary) Also, fora Kraft a significant challenge would be ITC Foods that has been tapping into the premium foods annd lifestyle markets with limited but growing success. Unilever on the other hand has been slow in the market, Nestle restricted to powdered milk markets and Amul and Britannia eclipsing any Cadbury sized competition in Cheeses..this just a quick post as we wait for more clarity..Cadbury’s portfolio could definitely get a rejig, but its positioning and marketing budgets would be impossible to search and replace..in any casual restructuring.
Kraft os one of the few who is tackling disparate urban clusters in China with a 20% boost in ad spending in 2009. Also going for it are the ever expanding dairy products and cookies markets that could take the merged behemoth beyond just confectionary where it is already a World no. 1 Any market where a 15% or less share globally is enough for leading industry needs to be rewritten and a Global Foods and Dairy giant that could change Buffet’s world view could well be somethhing for Irene and Sanjay to attempt.
Also, maybe an Idle mind’s natter but Kraft is not into Sports like Cadbury, An Indian Market’s demographics may be key in saving Cadbury’s Olympic sponsorships, but other markets in Asia may not work the same way, nor the home market in Europe





















