Why Cadbury is keeping healthy snack brand at arm’s length

Cadbury%20logoA new confectionery brand that claims to be healthier than its rivals launches in the UK this month. The Natural Confectionery Company (TNCC) is a range of jelly sweets, already popular in Australia, which have no artificial colours or flavours, and will be positioned firmly in the better-for-you snacks category.

TNCC has appointed Sledge, an experience agency, to create a “live environment” that will bring the launch to life with sampling and events.

But the one thing that the parents and children it aims to engage will not be told is that TNCC is owned by Cadbury Schweppes (MW last week) and that it will be run from within its Cadbury Trebor Bassett confectionery division.

The confectionery giant acquired Australian-owned TNCC in 2003 and is thought to have been plotting a UK launch as the tide of public opinion has turned towards healthier products and away from the high sugar and fat products that make up Cadbury’s chocolate portfolio.

Break from the past
But Cadbury has been going through tough times starting with last year’s Salmonella scare, for which it is facing a criminal prosecution later this year, and a second major product recall due to mislabeling products containing nuts earlier this year.

The £10m launch of its Trident chewing gum brand also hit problems when the Advertising Standards Authority banned its launch advertising for being racist (MW March 29).

Cadbury appears keen to keep its battered parent brand away from a product that is positioned as natural and healthier. Richard Oldham, senior consultant at The Value Engineers, says: “Cadbury is a well-loved brand, but it does have baggage. Would using the main brand help or hinder?” 

Access all areas
The launch or acquisition of a new brand as part of a strategy to stretch a company into new areas has been implemented by a variety of companies. Organic food brand Seeds of Change has no visible Masterfoods branding and Walkers Snacks launched new crisp-and-nut brand Nobby’s in 2005, again as a standalone brand, in a bid to target a younger, male audience.

In the car market, Toyota launched Lexus back in 1989 as its luxury car offering, but with no visible Toyota branding, and Nissan has followed suit with its Infiniti brand, which it is currently launching in Europe.

The thinking behind this strategy is clear, according to Interbrand chief executive Rune Gustafson. “Strong brands know what they are good at and what they are not good at. They have to be confident enough to realise when a brand can’t be stretched into a different market, segment or positioning.”

He adds that Cadbury has realised it does not have reach in some areas and that creating new brands, despite the high launch costs, is a less risky strategy.

This explains why, despite having a master brand strategy, Unilever keeps Ben & Jerry’s outside it. The ice cream brand does not carry the Unilever logo like all other products across its portfolio and it maintains separate offices. It has been insulated from the corporate mentality, something Unilever allows so as not to alienate Ben & Jerry’s loyal fans.

So far, this has been the approach that Cadbury has taken with upmarket organic chocolate brand Green & Black’s since it took it over in 2005.

Oldham says that many large companies believe they can have “these little gems” in their portfolio, but over the years they become swamped by the corporate identity, despite being launched with every intention of keeping them at arm’s length.

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