Mondelez India plan to expand
Mondelez India plan to expand

Mondelez India Foods, former Cadbury India has chalked out a plan to expand its rural operations as chocolate penetration in the country doubles with rising consumption.

The maker of Cadbury Dairy Milk chocolate, Bournvita milk food drink, Tang powdered drink mix and Oreo biscuits has identified 20,000 high potential villages in nine states where it will deploy its distribution machinery to market its products.

Afterwards, the firm will continue to expand in about 5,000 odd villages every year, Chandramouli Venkatesan, MD, Mondelez India Foods said.

"Rural is increasingly integrating with the mainstream and that is one of the key drivers to growth. Earlier, rural was defined by not only a place where people lived but also the mindset. Today, it's only a place where you stay and the mindset has become mainstream. Better connectivity to technology has enabled this shift," said Venkatesan, who took over at the helm of the firm in January this year. Reaching 7,80,000 villages in India can be a challenging task for a marketer.

When Mondelez, three years back began evaluating the potential of the rural market, it had experimented with placing dispensers at select stores in three villages in Maharashtra where none of its products were available.

"We watched for a month and were surprised that the throughput at these stores was Rs 1,000 in one month. This is comparable to what one would get in a lower end store in urban India," said Venkatesan. Mondelez realised that the rural consumer was willing to purchase its products much like its urban counterpart. Over the last decade, the per capita consumption of chocolate in India has trebled from 30 gm per annum to over 100 gm.

The rising per capita consumption of chocolate in the country and the potential growth in rural India, has led Mondelez to invest close to $200 million in capacity expansion and visi-coolers.  According to a Nielsen report, Mondelez draws 12 percent of it’s roughly Rs 7,000 crore turnover from rural markets.

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