How often do you see a successful launch of a sub-brand or a variant priced at 10 times the price of its core offering?
2010 saw Cadbury India faced with a unique problem. The immensely successful ‘meetha’ campaign for Cadbury Dairy Milk (CDM) made the brand and the category grow so fast that all installed manufacturing capacity was exhausted. And now, CDM stood to lose share in a growing market it had built!
The way out - increase value contribution of CDM’s business dramatically. Till supply constraints get resolved.
The solution was to bring in a premium offering, and extract more value per transaction, and make the best use of constrained capacities.
CDM’s impending premium offering – CDM Silk, till then planned only as a sheen provider to India’s best loved chocolate, and to fight the image threat from international chocolate brands, now had to solve a real business issue.
But consumers were unwilling to pay the hefty premium for Silk. CDM after all, was an affordable treat for all.
This case proves that our work people to see enough value in CDM Silk to pay 10 times the popular price-point of CDM. It made Silk the 3rd largest brand in the Cadbury portfolio, and also the 3rd largest brand in the country. And helped CDM stay at the top of the market. All within just 3 years of its launch. All at lower media investments compared to key benchmarks.
For the theorist in each one of us, this case illustrates a remarkable victory of marketing over one of its toughest adversaries – the ‘price glass ceiling’ – beyond which popular brands cannot normally charge a premium.