Page 147 - DMGT551_RETAIL_BUSINESS_ENVIRONMENT

Retail Business Environment

Notes Taldar said the company has put in place consumer promotions within stores in key
categories such as chocolates and biscuits to help drive sales at these outlets.
While the combined Cadbury-Kraft business remains smaller than other strategic markets
within Kraft Foods, which recently announced that it was splitting into two - a $32-billion
snacking powerhouse and a $16-billion grocery business - India is still key. Irene Rosenfeld,
chairperson and chief executive of Kraft Foods, who visited India in November 2011, said
that she is keen to see the Indian business emerge as one of the top five food companies in
the country.
Cadbury-Kraft’s main rivals include key food companies in India, such as Nestle, which
own Maggi and Kit Kat; Britannia; HUL, makers of Knorr, owners of Kissan and Bru; Parle
Products, ITC and GlaxoSmithKline with its Horlicks, Viva, and Maltova brands.
Like most of its rivals, the bulk of Cadbury-Kraft’s sales come from traditional retail
stores. Modern trade or organised retail constitutes only one per cent of its universe, but
the company is keen to push this number up, given that packaged foods as a category
show greater traction in such retail outlets.
Cadbury-Kraft is banking on technology, much like HUL, to help it replenish stock quickly
at stores, both traditional and modern. “We have upgraded the frontline sales force with
handhelds to capture store orders, which are linked to the distributor billing software,”
said Taldar. “Distributors are linked to company portals to manage auto replenishment of
inventory.”
The Mumbai-based company is looking to increase its retail footprint beyond the over
700,000 stores in 5,200 towns that it now reaches. This number will be ramped up this year,
especially in rural areas, said Taldar.

Question:
Why do you think Cadbury-Kraft want to study consumer behaviour inside stores?
Source: Business Standard

7.7 Summary

Customers exist within a society, and are subject to a whole host of influencing factors that
shape the way they shop.
Customers are complex human beings, they may act differently according to the type of
shopping trip they are on, seeking value during one shopping mission, and then indulging
themselves on another.
This gives rise to the notion of a hybrid customer, within a market of customers who seem
to be increasingly less predictable as groups.
At the same time, international retailing activity reflects an acceptance of global brands in
a worldwide market which needs and tastes converge.
Social, psychological, and personal factors influence consumer purchase decisions. Social
factors are forces exerted by other people and include culture and Sub-culture, roles and
family, social class, and reference groups.
Psychological forces are internal to individuals that affect purchase behaviour and include
motivation perception, learning, attitudes, and personality.

Personal factors are forces unique to an individual consumer and include demographic
factors, lifestyle, situational factors, and an individual’s involvement in purchase.

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