Indians getting sweet on chocolate thanks to Cadbury revolution
Back in the early ‘Nineties, Cadbury used an advertising campaign to redefine the concept of eating chocolates, shifting the focus from “just for kids” to the “the kid in us all”.
And over the last decade, the per-capita consumption of chocolate has almost trebled, from 50g in 2005 to 120g last year. Today, increasing disposable income, a rising trend towards giving chocolates as gifts instead of traditional Indian sweets, and surging sales of dark chocolate have all been providing a major boost to the industry.
India’s chocolate industry is now worth Rs58bn (US$966m), and is expected to grow at a rate of 16% each year to reach Rs122bn (US$2bn) by 2019.
It is dominated by Cadbury India (now Mondelēz) and Nestlé India, which together account for nearly 92% of the market share today. Mars International and Ferrero India are slowly gaining ground in the domestic market through new product launches.
Milk chocolate is currently the most popular category in India, contributing to 75% of the total sales of chocolates. Dark chocolate, with only a 9% share of the market, is expected to be the fastest growing segment as more consumers become aware of its health benefits.
Moreover, Indian tastes have been slowly evolving to get better accustomed to dark chocolate. Companies like Cadbury and Nestlé have successfully introduced their own dark chocolate brands such as Bournville and Nestlé Dark Chocolate.
According to Tejaswee Shrestha, a senior research analyst at ValueNotes, which conducted the research: “An increase in the purchasing power of consumers and exposure to global chocolate brands will drive the premium chocolate market. Manufacturers are now keen to tap the rising affluent urban population and are introducing premium or higher priced products in the market.”
Urban cities account for nearly 80% of chocolate consumption, and although distribution in rural India is improving, this segment still remains largely untapped. Poor infrastructure, including inadequate transportation and warehousing facilities, is the biggest challenge outside the metros.
Smaller chocolate packets, weighing less than 30g and priced up to Rs10 (US$0.16), accounts for the fastest growing segment in rural areas.