Cadbury Nigeria Plc, owners of Bournvita beverage drink has announced a partnership with Indomie Noodles. The partnership will see Cadbury sell a promo pack Bournvita along with five sachets of Indomie
Leading beverage brand, Bournvita, a product of Cadbury Nigeria Plc, has partnered Indomie Noodles to launch Bournvita celebration promo pack. The specially designed Bournvita pack comes with three and five sachets of Indomie for 500 and 900 grams Bournvita respectively and still sell for the normal price in the market.
According to Managing Director of Cadbury West Africa, Mr. Roy Naaman,Cadbury
“We are joining the power of two iconic brands in the country. Bournvita and Indomie are leading brands who have decided to collaborate in order to provide more value to our consumers. We have two packs of 500 and 900 grams Bournvita which contain three and five packs of Indomie noodles respectively. The price for both 500 and 900 grams of Bournvita remain the same. The additional packs of Indomie noodles comes at no extra cost”
However, analysts interviewed by Nairametrics suggest this is much more than a partnership between two companies. They opine that Cadbury has been facing a significant drop in sales of its premium Bournvita beverage drink and badly needs a boost to help drive sales back up. A look at the company’s latest 9 months results also buttresses this view as revenue dropped 10% to N21 billion year on year.
According to analysts at ARM;
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on a quarterly basis, revenue growth remained negative for the eight consecutive quarter (-13.2% YoY to
N6.9billion vs. Q3 15E: N6.5billion). Amid no change in pricing, top-line weakness continues to reflect slack volume growth at Cadbury due to weaker consumer purchasing power.
What this all means is that Cadbury’s flagship product Bournvita is not selling and needs a major booster. Cadbury needs to get its top line revenue growth back on track and thus may need to do a lot more than partnering with Indomie Noodles. Surely, consumers will see this deal as an attractive proposition considering that it offers them a freebie. However, consumers who have long decided to adjust their pockets won’t go for jumbo pack drinks. Most would rather prefer to buy in sachets should they need to take chocolate drinks.
A 900g of Bournvita is about N1,850 should you want to buy it and get the freebie noodles. However, A 70g Indomie Noodle cost between N60 to N80 depending on the flavour whilst a 20g Bournvita sachet cost between N30 to N40. It will be interesting to see how this pans out and if the company might be introducing other moves aimed at boosting sales. Investors won’t care less if this Indomie move works or not provided top line revenue growth is back on track. To many, doing something is better than doing nothing.
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