Mondelez India, which controls more than two-thirds of the chocolate market, has stated that there has been a strong volume growth in chocolate sales, kicking off the overall market slowdown trend and indicating that consumers may be turning to comfort food in a time of stress and inflation.
Deepak Iyer, president at Mondelez India, said, “We see a lot of growth being fired by double-digit volume, which is quite an exception given the kind of muted volume growth in the industry.”
“In the event of a severe lockdown, the one who will be eliminated first is discretionary.” But if you are talking about sad times, it’s great comfort food. So, I don’t think it is more recession- or non-recession-led.
“A lot of it is about how the business has been impacted, the reasons behind it, and how chocolate or biscuits solve it.” The makers of Oreo and Bournvita attribute their sales surge to newer innovations across categories and distribution expansion, especially in the hinterland, where historically they had a smaller presence.
As a result, rural now accounts for over a fifth of its overall sales, nearly double compared to 10–12% five years ago. With per capita consumption of chocolate around 140 grams per year in India and over 10 kilos per year in the UK, the headroom is huge.
“It is super important for us to stay focused on consumption, and consumption means volume.” In addition, we always consider three levers to pull and two levers to press. One is the relevance of the brand. “Second is the availability of the brand, and third is the affordability of the brand,” said Iyer.