How Cadbury became a synonym for sweets in Indian Festivals.

I visited my home last week to celebrate Diwali with my family. After all the celebrations, I realized we had a variety of sweets given by my relatives and neighbours. While most of it was Soan Papdi (of course), one of the many boxes of sweets was a box of Cadbury Celebrations. I began wondering, how did a chocolate company find its place in this country with endless kinds of sweets already?

Cadbury has come a long way from just some chocolate manufacturing company to India’s largest chocolate brand, with many product lines catering to different population segments.

How did Cadbury become so huge? Well, to understand this, let us look at Cadbury’s journey.

John Cadbury, the founder of Cadbury, opened a grocery store in 1824 in Birmingham where he sold cocoa and a chocolate drink which he prepared by himself. Not many people know the reason why Cadbury started his chocolate business. John began to it to reduce alcoholism by replacing alcohol with better alternatives.

Cadbury introduced many products like chocolate bars, easter eggs, and Turkish Delights in the coming years. In 1905, the company introduced the famous Dairy Milk chocolate bar.

Now, this was all happening in the UK. Cadbury entered the Indian market right after our independence, that is, in 1948, and it was a success! Well, it was not just a stroke of luck that the company entered a new market and found success; Cadbury understood the Indian culture and needs very well and used strategies accordingly to become successful.

Coming back to my question, “How did a chocolate company find its place in this country where there are endless kinds of sweets already?” It exercised a thoroughly planned positioning strategy and relatable ad campaigns.

When the chocolate brand was initially launched, it targeted children. While the company saw growth, some people were concerned about their children’s oral health. Reports said excessive late or sugar-filled confectionaries were harmful to teeth as they cause tooth decay and other issues.

So, Cadbury positioned itself as a brand that catered not just to children but also the youth. How did it do it? It did so through a good quality and relatable ad campaigns.

It came up with its famous ad campaign – “Asli Swad Zindagi Ka”, for the youth, where a girl joyously dances in a cricket stadium to celebrate her friend’s batting. Cadbury also reprised this famous ad recently where the roles were switched, and a guy is joyously dancing with a Cadbury chocolate bar in his hand to celebrate his friend’s batting in the stadium. The campaign then became a huge hit. The youth of India started consuming more and more Dairy Milk. Not just this, Cadbury capitalized on giving sweets whenever we celebrated something. Like whenever we started something new, passed our exams, got good news, or anything where we would buy a sweet, Cadbury positioned itself in such a way that we would buy Cadbury chocolates as sweets.

It introduced many ad campaigns like “Shubh Aarambh” and” Kuch Meetha Ho Jaye”, among others, with famous personalities like Shah Rukh Khan and Amitabh Bachchan, which still resonate with Indian Households.

Cadbury launched various product lines to cater to different consumer segments. Cadbury Bournville was introduced for premium chocolate consumers, Cadbury Silk with its limited edition Valentine’s Special was introduced for the youth, Cadbury Celebrations was just for the Festive market, and so many more.

Today, Cadbury has a share of 65% of the chocolate market in India. It has a product offering to every consumer class in India, like chocolates, malt-based milk drinks, chocolate milk drinks, biscuits and many more.

Manan Duggar

A curious mind, interested in Technology, Cosmos and anything under the big blue sky.

What’s wrong with Credit Suisse?

                    

Credit Suisse is one of the biggest global banks in the world. It is so huge that it generated a revenue of $22 Billion, operates in 50 countries, and its assets under management (AUM) alone amount to $ 1.1 trillion. Still, in the past year, something crazy has happened. They lost more than $ 15 billion in 2 terrible investments, reported five quarters of loss in the last seven quarters when all global banks reported profits and laid off 5000 employees. Combined with the pandemic, the Russia and Ukraine war United kingdom’s economic turmoil, all of them have put this giant bank at significant risk.

In 2008, when almost all banks around the globe were facing some deep crisis, the Lehman brothers and Bear sterns collapsed, and Morgan Stanley and Goldman Sachs were on edge. AMRO, ABN, GE Countrywide, Dresdner Bank, and Merrill Lynch must undergo mergers for their survival. Despite this terrible situation Credit Suisse came out unscathed. That could be ascribed to Credit Suisse being more focused on wealth solutions, and their investment banking business was not as aggressive as others. One argument could be the 2008 event made Credit Suisse too optimistic.

Many big scams and losses can be observed in recent years, leading to two things. First, Aggressive investment banking and its incentive structure led to excessive risk-taking by the sales team. Second, Credit Suisse gave the sales and business development teams the liberty to overrule the risk and compliance team, which triggered some bad decisions. Out of which, some significant setbacks are:

The first would be in March 2021, when Greensill capital went bankrupt as Credit Suisse has exposure of $10 billion. Greensill capital was a financer of the supply chain, and these receivables were securitized, converted into bonds, and sold as an asset to clients. Only part of the fund is recoverable and ends up with losses rest is dependent on insurance claims and their realizable value. The second would be Archegos Capital Management, which Credit Suisse heavily funded and ended up losing $5.5 billion. This loss could have been lower if it exited from the position like Morgan Stanley and Goldman Sachs did. Third would be facing criminal money laundering charges for handling cash for cocaine traffickers. Credit Suisse was also fined £350 million for a Mozambique tuna bond scam, the loan arranged for the Republic of Mozambique. Credit Suisse has also funded some high-risk assets like superyachts and chartered plains for Russian oligarchs, which became trouble as Russia Ukraine war started.

The most significant source of worry for Credit Suisse is CDS (Credit Default Swap), Which shoots up to a record high, i.e., above 250. Currently, other banks have CDS below 150. The probability of Credit Suisse CDSs getting into bankruptcy is 23%. Which makes people think Credit Suisse is becoming Lehman Brothers of the EU.

Like Lehman Brothers, Credit Suisse may indicate the bigger problem, which might have several other parts. First, Inflation is rising and about to touch double-digit. That forced the European Central Bank (ECB) to adopt a hawkish policy and make the cost of funds very high to control Inflation. Second, the Energy crisis that the EU is currently facing. The prime concern of many European energy companies is their dependence on Russian gas and continuous supplies. They may have to file for bankruptcy. Third, trillions of dollars invested as European pension assets are now facing a unique problem. These bonds are billions of dollars in losses due to higher bond yields. All these factors will might compound the issue for Credit Suisse.

Most likely, Credit Suisse will not be the Lehman Brothers of Europe. The banking system is much more sound, and systematic risk management is more vigorous than in 2008. Credit Suisse also has huge capital to withstand losses, and they still have a better liquidity coverage ratio of 1.91. The survival of Credit Suisse through the crisis lot will depend on how the management will present the restructuring plan on the 27^th of October when they announce their September quarter results.

Ankit Yadav

Being boring is best.