Dissertation Project Report on (Study of Consumer Behavior towards Cadbury & Nestle Chocolates) Submitted by : TAMAL MANNA Batch No : 25 Enroll. No : 251091131 Session : 2009-2011 Submitted On : 19 th February, 2011 A report submitted in partial fulfillment for the requirement of 2 Year Full Time Masters in Business Administration & (MBA+PGPM) From
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Dissertation Project Report on Nestle & Cadbury Chocolates
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Dissertation Project Report
on(Study of Consumer Behavior towards
Cadbury & Nestle Chocolates)
Submitted by : TAMAL MANNA
Batch No : 25
Enroll. No : 251091131
Session : 2009-2011
Submitted On : 19th February, 2011
A report submitted in partial fulfillment for
the requirement of
2 Year Full Time Masters in Business Administration&
(MBA+PGPM)
From
Institute of Management & Development
New Delhi
DECLARATION
I, Tamal Manna, bearing Enrollment No. 251091131 a student of Institute of
Management & Development, New Delhi affiliated to PTU, pursuing Masters
in Business Administration. Hereby, declare that the project report entitled
“STUDY OF CONSUMER BEHAVIOR TOWRDS NESTLE & CADBURY
CHOCOLATES” submitted is my original work and the project report has not
formed the basis for the award of any diploma, degree, associate ship,
fellowship or similar other titles. It has not been submitted to any other
university or institution for the award of any degree or diploma.
Date: Tamal Manna
Place: MBA – IV
Semester.
ACKNOWLEDGEMENT
Survey is an excellent tool for learning & exploration. No classroom routine
can substitute which is possible while working in real situations.
Application of theoretical knowledge to practical situations is the bonanzas
of this survey.
Without a proper combination of inspection & perspiration, its not easy to
achieve to anything. There is always a sense of gratitude, which we express
to others for the help & needy services they render during the different
phases of our lives. I really wish to express my gratitude towards all those
who have been helpful to me directly or indirectly during the development
of this project.
I would like to thank my professors Renu Sharma & Arvind Arora, who was
always there to help and guide me whenever I needed help. Their
perspective criticism I am thankful to them for their encouraging and
valuable support. Working under them was an extremely knowledgeable
and enriching experience for me. I am very thankful to them for all the
value addition and enhancement done to me.
No words can adequately express my overriding debt of gratitude to my
parents whose support helps me in all the way.
Tamal Manna
TABLE OF CONTENTS
1. Introduction.
2. Consumer preference.
3. Scope of the study.
4. Objective of the study.
5. Limitation of study.
6. History of chocolates.
7. Chocolate production.
8. Consumption of chocolate in India.
9. Nestlé’s profile.
10. Cadbury’s profile.
11. Basis of Research & Design.
12. Analysis of data findings.
13. Conclusion.
14. Suggestions & recommendations.
LIST OF TABLES
TABL
E
NO.
TITLES
1. Liking for the chocolates.
2. Different age groups.
3. Preference according to age groups.
4. Brand preference.
5. Purchase of Cadbury chocolates.
6. Purchase of Nestle chocolates.
7. Overall purchase of chocolates.
8. Preference of sub brands of Cadbury Chocolates.
9. Preference of sub brands of Nestle Chocolates.
10. Influencing factors during purchase of Cadbury Chocolates.
11. Influencing factors during purchase of Nestle Chocolates.
12. Factors giving most satisfaction to consumers in Cadbury chocolates.
13. Factors giving most satisfaction to consumers in Nestle chocolates.
14. Form preference.
15. Pack of chocolates preferred.
16. Promotional offers.
17. Factors affecting purchase.
18. Media of advertisement.
19. Frequency of consumption.
20. Reasonable price.
21. Consumers brand loyalty.
22. Reaction of consumer if new brand is introduced
INTRODUCTION
In this research I have survey the product performance and buying
behavior of two famous brands of chocolates – Nestle and Cadbury, which
are consumed by people of all ages. During this research I have interacted
with people of “Delhi & Kolkata”. After this research I came to know how
people perceives these products on the variables like price, quality,
advertisement, satisfaction, taste, packaging, brand loyalty etc. I also came
to know which particular brand of chocolate is most preferred by people of
different age groups. In this research I have surveyed that how frequently
and how much chocolate they consume, whether they buy small, big or
family pack. Trend of ongoing changes in their likings has been shown in
the report. In this report I have tried to explain the entire research and
facts product wise.
CONSUMER PREFERENCE
All marketing starts with the consumer. So consumer is a very important
person to a marketer. Consumer decides what to purchase, for whom to
purchase, why to purchase, from where to purchase, and how much to
purchase. In order to become a successful marketer, he must know the
liking or disliking of the customers. He must also know the time and the
quantity of goods and services, a consumer may purchase, so that he may
store the goods or provide the services according to the likings of the
consumers. Gone are the days when the concept of market was let the
buyer’s beware or when the market was mainly the seller’s market.
As consumers, we play a very vital role in the health of the economy local,
national or international. The decision we make concerning our
consumption behavior affect the demand for the basic raw materials, for
the transportation, for the banking, for the production; they effect the
employment of workers and deployment of resources and success of some
industries and failures of others.
Thus, marketer must understand this preference (or "taste") is a concept,
used in the social sciences, particularly economics. It assumes a real or
imagined "choice" between alternatives and the possibility of rank ordering
of these alternatives, based on happiness, satisfaction, gratification,
enjoyment, utility they provide.. The study of the consumer preference not
only focuses on how and why consumers make buying decision, but also
focuses on how and why consumers make choice of the goods they buy and
their evaluation of these goods after use. So for success of any company or
product promotion it is very necessary to depart its concentration towards
consumer preference.
SCOPE OF THE STUDY
As learning is a human activity and is as natural, as breathing. Despite of
the fact that learning is all pervasive in our lives, psychologists do not
agree on how learning takes place. How individuals learn is a matter of
interest to marketers. They want to teach consumers in their roles as their
roles as consumers. They want consumers to learn about their products,
product attributes, potential consumers benefit, how to use, maintain or
even dispose of the product and new ways of behaving that will satisfy not
only the consumer’s needs, but the marketer’s objectives. The scope of my
study restricts itself to the analysis of consumer preferences, perception
and consumption of Cadbury and Nestle Chocolates. There are many other
brands of chocolates available but my study is limited to two major players
of chocolates leaving behind the others.
OBJECTIVES OF THE STUDY
This project is based on the comparative study consumer behavior towards
Nestle and Cadbury chocolates. Objectives of the study are:
The other objective is to know about the customer satisfaction level
associated with the product and the customer preference level.
To increase customer satisfaction and recapture the market share by
fulfilling the customer needs.
To study the factors affecting the consumption pattern.
LIMITATIONS OF THE STUDY
In attempt to make this project authentic and reliable, every possible
aspect of the topic was kept in mind. Nevertheless, despite of fact
constraints were at play during the formulation of this project. The main
limitations are as follows:
Due to limitation of time only few people were selected for the study. So
the sample of consumers was not enough to generalize the findings of the
study.
The main source of data for the study was primary data with the help of
self-administered questionnaires. Hence, the chances of unbiased
information are less.
People were hesitant to disclose the true facts.
The chance of biased response can’t be eliminated though all necessary
steps were taken to avoid the same.
Chocolate
The very word makes your mouth water.
Chocolate is more than just a food: it’s a state of mind.
Chocolates
Chocolates! Chocolates!
Every body has a liking for them, be they in the form of bar
Or a tiny little gem,
Or shaped like a rectangle,
Or a sphere, a brick or an éclair.
For chocolate lovers it is fun,
To have them during rain, breeze or sun.
They are white and brown in color,
And taste sweet and bitter.
Some have them in a glass of cold coffee, or in the form of a toffee.
Some eat them when they are sad.
Some relish them when they are happy or have sweet dreams,
But I feel, to have chocolates.
We don’t need a reason,
‘Cause we can have it.
Anytime, any season!
History of Chocolates
The origin of chocolate can be traced back to the ancient Maya and Aztec
civilizations in Central America, who first enjoyed “chocolati” a much-prized
spicy drink made from roasted cocoa beans. Throughout its history,
whether as cocoa or drinking chocolate beverage or confectionary treat,
chocolate has been a much sought after food.
The Aztec empire
“Chocolate”(in the form of a luxury drink) was consumed in large
quantities by the Aztecs: the drink was described as “ finely ground, soft,
foamy, reddish, bitter with chili water, aromatic flowers, vanilla and wild
bee honey. The dry climate meant the Aztecs were unable to grow cocoa
trees, and had to obtain supplies of cocoa beans from “ tribute” or trade
Don Cortes
The Spanish invaded Mexico in the 16th century, by this time the Aztecs
had created a powerful empire, and the Spanish armies conquered Mexico.
Don Cortes was made captain general and governor of Mexico. When he
returned to Spain in1528 he loaded his galleons with cocoa beans and
equipment for making the chocolate drink. Soon “chocolate” became a
fashionable drink enjoyed by the rich in Spain.
Chocolate across Europe
An Italian traveler, Francesco carletti, was the first to break the Spanish
monopoly. He had visited Central America and seen how the Indians
prepared the cocoa beans and how they made the drink, and by 1606
chocolate was well established in Italy.
Drinking chocolate
The secret of chocolate was taken to France in 1615, when Anne, daughter
of Phillip 2 of Spain married king Louis 13 of France The French court
enthusiastically adopted this new exotic drink, which was considered to
have medicinal benefits as well as being a nourishing food.
First chocolate for eating
Up until this point all chocolate recipes were based on plain chocolate. It
was an English doctor, Sir Hans’s Sloane, who- after traveling in south
America- focused on cocoa and food values, bringing a milk chocolate
recipe back to England. The original Cadbury milk chocolate was prepared
to his recipe.
History
The earliest record of chocolate was over fifteen hundred years ago in the
central America rain forests, where the tropical mix of high rain fall
combined with high year round temperatures and humidity provide the
ideal climate for cultivation of the plant from which chocolate is derived,
the cacao tree.“ Chocolate is made from the cocoa bean, found in pods
growing from the trunk and lower branches of the cacao tree, Latin name
“ the obroma cacao” meaning “ food of the gods”
Cacao was corrupted into the more familiar “ cocoa” by the early European
explorers. The Maya brewed a spicy, bittersweet drink by roasting and
pounding the seeds of the cacao tree with maize and capsicum peppers and
letting the mixture ferment. This drink was reserved for use in ceremonies
as well as for drinking by the wealthy and religious elite; they also ate
cacao porridge.
Chocolate in EuropeXocolatl! or chocolat or chocolate as it became known, was brought to
Europe by Cortez, by this time the conquistadors had learned to make the
drink more palatable to European tastes by mixing the ground roasted
beans with sugar and vanilla ( a practice still continued today), thus
offsetting the spicy bitterness of the brew the Aztec’s drank.
The first chocolate factories opened in Spain, where the dried fermented
beans brought back from the new world by the Spanish treasure fleets were
roasted and ground, and by the early 17th century chocolate powder – from
which the European version of the drink was made- was being exported to
other parts of Europe.
If only they had known, chocolate was so expensive at that time, that it was
worth it’s weight in silver ( if not gold), chocolate was treasure indeed !
Within a few years, the cocoa beverage made from the powder produced in
Spain had become popular throughout Europe, in the Spanish Netherlands,
Italy, France, Germany and – in about 1520 – it arrived in England. The first
chocolate house in England opened in London in 1657 followed rapidly by
many others.
Back to the America’s
Event’s went full circle when English colonists carried chocolate (and
coffee) with them to England’s colonies in north America. Destined to
become the united states of America and Canada, they are now the worlds
largest consumers – by far – of both chocolate and coffee, consuming over
half of the words total production of chocolate alone.
The Quakers
The Quakers were, and still are, a pacifist religious sect, an offshoot of the
puritans of English civil war and pilgrim fathers fame and a history of
chocolate would not be complete without mentioning their part in it. Some
of the most famous names in chocolate were Quakers, who for centuries
held a virtual monopoly of chocolate making in the English speaking world –
fry, Cadbury and row tree are probably the best known.
Its probably before the time of the English civil war between parliament
and king Charles 1st that the Quaker’s who evolved from the puritans, first
began their historic association with chocolate. Because of their pacifist
religion, they were prohibited from many normal business activities, so as
an industrious people with a strong belief in the work ethic (like the
puritans), they involved themselves in food related businesses and did very
well. Baking was a common occupation for them because bread was
regarded as the biblical “staff of life”, and bakers in England were the first
to add chocolate to cakes so it would be a natural progression for them to
start making pure chocolate.
What is certain is that the fry, row tree and Cadbury families in England
among others, began chocolate making and in fact Joseph fry of fry &sons
(founded 1728 in Bristol, England) is credited with producing and selling
the world’s first chocolate bar. Fry’s have now all but disappeared (taken
over by Cadbury) and row tree have merged Swiss company nestle, to form
the largest chocolate manufacturer in the world. Cadbury have stayed with
chocolate production and are now, if not quite the largest, probably one of
the best-known chocolate makers in the world.
Chocolate as we know it
The first mention of chocolate being eaten in solid form is when bakers in
England began adding cocoa powder to cakes in the mid 1600’s. Then in
1828 a Dutch chemist, Johannes van houten, invented a method of
extracting the bitter tasting fat or “cocoa butter” from the roasted ground
beans, his aim was to make the drink smoother and more palatable,
however he unknowingly paved the way for solid chocolate as we know it.
Chocolate as we know it today first appeared in 1847 when fry & sons of
Bristol, England – mixed sugar with cocoa powder and cocoa butter (made
by the van houten process) to produce the first solid chocolate bar then
in1875 a Swiss manufacturer, Daniel peters, found a way to combine (some
would say improve, some would say ruin) cocoa powder and cocoa butter
with sugar and dried milk powder to produce the first milk chocolate.
Chocolate production – Procedure
The cocoa-bean -- the heart of the sweetest delicacy in
the world -- is bitter! This is why, up to the 18th century
some native tribes ate only the sweetish flesh of the
cocoa fruit. They regarded the precious bean as waste or
used it, as was the case among the Aztecs, as a form of
currency.
The VarietiesThere are two quite different basic classifications of
cocoa, under which practically all varieties can be
categorized : Criollo and Forastero cocoas. The pure
variety of the Criollo tree is found mainly in its native
Equador and Venezuela. The seeds are of finer quality
than those of the Forastero variety.
They have a particularly fine, mild aroma and are, therefore, used only in
the production of high-quality chocolate and for blending. However,
Criollo cocoa accounts for only 10% of the world crop. The remaining 90%
is harvested from trees of the Forastero family, with its many hybrids and
varieties. The main growing area is West Africa. The cocoa tree can
flourish only in the hottest regions of the world.
The HarvestImmediately after harvesting, the fruit is treated to prevent it from
rotting. At fermentation sites either in the plantation or
at, collecting points, the fruit is opened.
FermentationThe fermentation process is decisive in the production of high quality raw
cocoa. The technique varies depending on the growing region.
DryingAfter fermentation, the raw cocoa still contains far too much water; in fact
about 60%. Most of this has to be removed.
What could be more natural than to spread the beans out to dry on the
sun-soaked ground or on mats? After a week or so, all but a small
percentage of the water has evaporated.
Cleaning
Before the real processing begins, the raw cocoa is thoroughly cleaned by
passing through sieves, and by brushing. Finally, the last vestiges of wood,
jute fibres, sand and even the finest dust are extracted by powerful vacuum
equipment.
RoastingThe subsequent roasting process is primarily designed to develop the
aroma. The entire roasting process, during which the air in the nearly 10
feet high furnaces reaches a temperature of 130 °C, is carried out
automatically.
Crushing and shellingThe roasted beans are now broken into medium sized
pieces in the crushing machine.
BlendingBefore grinding, the crushed beans are weighed and blended according to
special recipes. The secret of every chocolate factory lies in the special
mixing ratios which it has developed for different types of cocoa.
GrindingThe crushed cocoa beans, which are still fairly coarse are now pre-ground
by special milling equipment and then fed on to rollers where they are
ground into a fine paste. The heat generated by the resulting pressure and
friction causes the cocoa butter (approximately 50% of the bean) contained
in the beans to melt, producing a thick, liquid mixture.
This is dark brown in colour with a characteristic, strong odour. During
cooling it gradually sets: this is the cocoa paste.At this point the production
process divides into two paths, but which soon join again. A part of the
cocoa paste is taken to large presses, which extract the cocoa butter. The
other part passes through various blending and refining processes, during
which some of the cocoa butter is added to it. The two paths have rejoined.
Cocoa ButterThe cocoa butter has important functions. It not only
forms part of every recipe, but it also later gives the
chocolate its fine structure, beautiful lustre and
delicate, attractive glaze.
Cocoa PowderAfter the cocoa butter has left the press, cocoa cakes are left which still
contain a 10 to 20% proportion of fat depending on the intensity of
compression.
These cakes are crushed again, ground to powder and finely sifted in
several stages and we obtain a dark, strongly aromatic powder which is
excellent for the preparation of delicious drinks - cocoa. Cocoa paste, cocoa
butter, sugar and milk are the four basic ingredients for making chocolate.
By blending them in accordance with specific recipes the three types of
chocolate are obtained which form the basis of ever product assortment,
namely –
KneadingIn the case of milk chocolate for example, the cocoa paste,
cocoa butter, powdered or condensed milk, sugar and
flavoring - maybe vanilla - go into the mixer, where they are
pulverized and kneaded.
RollingDepending on the design of the rolling mills, three or five vertically
mounted steel rollers rotate in opposite directions. Under heavy pressure
they pulverize the tiny particles of cocoa and sugar down to a size of
approx. 30 microns. (One micron is a thousandth part of a millimeter.)
ConchingBut still the chocolate paste is not smooth enough to satisfy
our palates. But within two or three days all that will have
been put right. For during this period the chocolate paste
will be refined to such an extent in the conches that it will
flatter even the most discriminating palate.
Conches (from the Spanish word "concha", meaning a shell) is the name
given to the troughs in which 100 to 1000 kilograms of chocolate paste at a
time can be heated up to 80 °C and, while being constantly stirred, is given
a velvet smoothness by the addition of certain amounts of cocoa butter. A
kind of aeration of the liquid chocolate paste then takes place in the
conches: its bitter taste gradually disappears and the flavor is fully
developed. The chocolate no longer seems sandy, but dissolves meltingly
on the tongue. It has attained the outstanding purity which gives it its
reputation.
Consumption of Chocolates in India
Chocolate consumption in India is extremely low. Per capita consumption is
around 160 gms in the urban areas, compared to 8-10kg in the developed
countries. In rural areas, it is even lower. Chocolates in India are consumed
as indulgence and not as a snack food. A strong volume growth was
witnessed in the early 90’s when Cadbury repositioned chocolates from
children to adult consumption. The biggest opportunity is likely to stem
from increasing the consumer base. Leading players like Cadbury and
Nestle have been attempting to do this by value for money offerings, which
are affordable to the masses.
Nestle India
Nestlé India is a subsidiary of Nestlé S.A. of Switzerland. With seven
factories and a large number of co-packers, Nestlé India is a vibrant
Company that provides consumers in India with products of global
standards and is committed to long-term sustainable growth and
shareholder satisfaction.
Nestlé India has presence across India with 7 manufacturing facilities and 4
branch offices spread across the region.
Nestlé India’s first production facility, set up in 1961 at Moga (Punjab), was
followed soon after by its second plant, set up at Choladi (Tamil Nadu), in
1967. Consequently, Nestlé India set up factories in Nanjangud
(Karnataka), in 1989, and Samalkha (Haryana), in 1993. This was succeeded
by the commissioning of two more factories - at Ponda and Bicholim, Goa,
in 1995 and 1997 respectively. The seventh factory was set up at
Pantnagar, Uttarakhand, in 2006.
The 4 branch offices in the country help facilitate the sales and marketing
of its products. They are in Delhi, Mumbai, Chennai and Kolkata. The Nestlé
India head office is located in Gurgaon, Haryana.
Nestlé’s story
Nestlé was founded in 1867 on the shores of Lake Geneva in Vevey,
Switzerland and its first product was “Farine Lactée Nestlé”, an infant
cereal specially formulated by Henri Nestlé to provide and improve infant
nutrition. From its first historic merger with the Anglo-Swiss Condensed
Milk Company in 1905, Nestlé has grown to become the world’s largest and
most diversified food Company, and is about twice the size of its nearest
competitor in the food and beverage sector. Nestlé’s trademark of birds in
a nest, derived from Henri Nestlé’s personal coat of arms, evokes the
values upon which he founded his Company.
Namely, the values of security, maternity and affection, nature and
nourishment, family and tradition. Today, it is not only the central element
of Nestlé’s corporate identity but serves to define the Company’s products,
responsibilities, business practices, ethics and goals. In 2004, Nestlé had
around 247,000 employees worldwide, operated 500 factories in approx.
100 countries and offered over 8,000 products to millions of consumers
universally.
The Company’s transparent business practices, pioneering environment
policy and respect for the fundamental values of different cultures have
earned it an enviable place in the countries it operates in. Nestlé’s
activities contribute to and nurture the sustainable economic development
of people, communities and nations. Above all, Nestlé is dedicated to
bringing the joy of ‘Good Food, Good Life’ to people throughout their lives,