Cadbury Worm Controversy

Introduction

In October 2003, just a month before Diwali, customers in Mumbai complained about finding worms in Cadbury Dairy Milk chocolates. Quick to respond, the Maharashtra Food and Drug Administration seized the chocolate stocks manufactured at Cadbury’s Pune plant.

In defence, Cadbury issued a statement that the infestation was not possible at the manufacturing stage and poor storage at the retailers was the most likely cause of the reported case of worms.

But the FDA didn’t buy that. FDA commissioner, Uttam Khobragade told CNBC-TV18, “It was presumed that worms got into it at the storage level, but then what about the packing – packaging was not proper or airtight, either ways it’s a manufacturing defect with unhygienic conditions or improper packaging.”

That was followed by allegations and counter-allegations between Cadbury and FDA. The heat of negative publicity melted Cadbury’s sales by 30 per cent, at a time when it sees a festive spike of 15 per cent. For the first time, Cadbury’s advertising went off air for a month and a half after Diwali, following the controversy. Consumers seemed to ignore their chocolate cravings.

As a brand under fire, in October itself, Cadbury’s launched project ‘Vishwa’s’ – a education initiative covering 190,000 retailers in key states. But what the company did in January 2004 is what really helped de-worm the brand.

By investing up to Rs 15 crore (Rs 150 million) on imported machinery, Cadbury’s revamped the packaging of Dairy Milk. The metallic poly-flow, was costlier by 10-15 per cent, but Cadbury didn’t hike the pack price.

Bharat Puri, managing director, Cadbury’s India says, “While we’re talking about a few bars of the 30 million we sell every month – we believe that to be a responsible company, consumers need to have complete faith in products. So even if it calls for substantial investment and change, one must not let the consumers’ confidence erode.”

Simultaneously, Cadbury’s roped in brand ambassador Amitabh Bachchan to do some heavy-duty endorsement putting his personal equity on the line for the brand.