The country’s largest chocolate maker, Mondelez, will increasingly cut sugar content in its products as Indian consumers get health-conscious, Chairman and Chief Executive Officer (CEO) Dirk Van de Put has said.
The maker of brands such as Cadbury and Oreo has already made a start by reducing sugar content by 30 per cent in a new variant of Cadbury Dairy Milk, launched last week in New Delhi, and will roll out more such products as it gradually makes the shift, he said.
Van de Put is on a two-day visit to India, his second since taking over as Mondelez International CEO from Irene Rosenfeld in November 2017. The 57-year-old Belgian national, who has worked for companies such as Coca-Cola, Mars, Novartis, Danone, and McCain Foods earlier, met the local team led by MD Deepak Iyer and made field trips to neighbourhood stores and supermarkets in Mumbai, headquarters of the Indian unit of the US major.
“India is a market where per-capita consumption of chocolate is around 130 grams. In the UK, it is over 10 kg. While we do not expect the per-capita consumption of chocolate in India to touch the level that exists in markets such as the UK, there remains enormous scope for growth,” Van de Put said.
“At the moment, we are growing in double digits in India and I would expect this to accelerate as we focus on this market. 80 per cent of the growth in the snacking category worldwide will come from developing markets and India will play a significant role within these markets. India snacking growth is already three times of what it is in the rest of the world for us and we see growth coming from all ends of the market, whether mid, premium or mass,” he said.
Market research agency Euromonitor estimates that the Rs 12,000-crore domestic chocolate market will grow at the rate of around 9-10 per cent over the next five years, driven by increased urbanisation, higher disposable incomes, and the preference for packaged foods.
Mondelez, whose India top line is Rs 6,100 crore, is tapping this market by launching products across the price pyramid. A low unit pack of Cadbury Dairy Milk, for instance, costs Rs 5 going up to Rs 165-170 for a bar of Cadbury Dairy Milk Silk, which is a premium product.
“The strategy for us would be to drive relevance, affordability and availability in India. We are also looking to devote attention to some of our other categories such as gums, candies, biscuits, and powdered beverages. There will be more launches in these segments as we go forward,” Van de Put said.
The global CEO also said the company was investing in areas such as manufacturing, distribution, and brand-building in India as it fought growing competition from peers such as Mars, Ferrero, Nestle, and Hershey’s within chocolates.
In the last three years, the company has invested close to $250 million (or Rs 1,750 crore) in setting up its largest manufacturing plant in India and the Asia-Pacific region at Sri City, Andhra Pradesh as well as a new research & development centre in Thane, Maharashtra, a first for the country.