DealZone

Poor? Some chocolate?

September 10, 2009

IndiaIf they don’t have bread, will they eat chocolates?

Cadbury’s hold on emerging markets such as India is part of the reason why Kraft wants the company so much, the Wall Street Journal said

The paper points out that Cadbury estimates more than half of India’s more than 1 billion people have never tasted chocolate, providing an opportunity for growth.

That’s a big number, but not necessarily a huge market. 

India measures poverty line in terms of daily calorie intake — 2,400 calories for folks living in rural areas and 2,100 for those living in cities. On that basis, the government estimates 27.5 percent of Indians lived below the poverty line in 2004-05. The measure might be conservative. As this New York Times report points out some say the number is at least 50 percent, and the actual caloric intake of the poorest 25 percent just 1,624 calories. 

The World Bank has set a poverty line at $1.25 per day. Under that measure, 42 percent of India’s population, or 456 million people, lived below the poverty line in 2005.

A 200 gram Dairy Milk bar has more than 1,000 calories, and it costs about 250 rupees, which is roughly $5. 

That could partly explain why even after 60 years of Cadbury in India, more than 500 million have never tasted chocolate.

Comments
One comment so far | RSS Comments RSS

The fact that chocolate hasn’t proven to be popular in India undoubtedly has something to do with the economics (most rational people wouldn’t pay $5 for 200g of chocolate) but climate is also a factor- it simply isn’t convenient.

Posted by Salvador | Report as abusive
 

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/