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CHOC WARS: Whittakers v Cadbury-Whose Side Are You On?

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Contributor:
Dave Griffith
Dave Griffith

War has broken out in our supermarkets. Once happy confectionary bars are now slugging it out in an all in brawl to the finish. It isn't a fight we can easily ignore because it concerns our most sacred food – CHOCOLATE. This is not the usual petrol price extortion or unsinkable floating mortgage rates drama. This is the smooth creamy taste that gets us through a dull work day and eases the pain of recession. A friend to watch sad movies with, and provide a tasty distraction from what ever it is we want to be distracted from.
 
If this were petrol we were talking about, the mere hint of conflict would have doubled the price in a week. Yet there is no danger to the chocolate supply here. If we want to we can pull up a couch, unwrap a block and munch away watching with idle curiosity from the sidelines. Before we do that though we need to remember that CHOC WARS is not just about Whittakers v Cadbury, Kiwi v Aussies, little v big, local v foreign. It’s about profit. Profit is paid by us. It is the difference between the price we pay for stuff and what it really cost to make it. The profit motive often drives supposed business rivals into bed with each other in what can become an unofficial united front in fleecing the punters. Profit first – competition second. A casual glance at petrol prices or mortgage rates reinforces this argument.
 
This spirit of profitable cooperation has been going on for years. Remember (if you are old enough) the introduction of the metric system in the early 1970’s. The food packets in the supermarkets were transformed into new 'Metric Packs'. The only consistent thing about these new packets apart from the word 'metric' was that the quantity was less than what we got in the old packs but the price was still the same. The fact that all the manufacturers did it meant with safety in numbers the consumer had no choice but to 'bite the bullet' and carry on.
 
Remember not that long ago when potato chips came in 190g packs and over a short space of time everyone shifted to 150g, but no one told the pricing department who obliviously carried on charging the same for 20% less product. To add salt to the wound so to speak, they came up with weirder flavours and put them into even lighter packs for a higher price. Pure profit genius. We won't even get into the beer cans and bottles that shrunk by 30ml.
 
The manufacturers behave like they are in a yacht race. One boat goes off in search of more wind (profit) the other yachts keep an eye on it. If they see its going faster than them (making more money) then they change course and join it so they can all take advantage of this new wind shift.
 
Outwardly they are all supposed to be competitors, yet they manage to move together like a school of fish. Or in the case of petrol suppliers – gold medal winning synchronised swimmers. Seldom does a manufacturer break ranks with the others for richer returns and the others don't follow.
 
So now the giant Cadbury has made its move. Reducing the size of their king size chocolate bars, altering the recipe and changed the packaging. All with little discernable change to the price. Whittakers - the other main local rival for that class of chocolate bar – would normally be expected to follow suit and tack off to join Cadbury in profit paradise. Not this time. Instead they have looked at the market and seen a wind shift of their own in another direction. Not only have they held their ground but they have gone on the attack with hard hitting advertising unsubtly pointing out the differences between their bars and Cadbury's. I hope there is no one in the upper echelons of Cadbury with the personality type of Mr. Weatherston. They might have an extremely violent response to having inferior size comparisons so mockingly made public.
 
A kiwi company taking on an international giant is not always the smart business thing to do. Remember what happened when Georgie Pie had a crack at McDonalds head on? McDonalds out-discounted and out marketed them. When Georgie were on their knees Maca's bought them and shut them down. On a cold winters day many of us still hanker after a tasty steak n' cheese. If only Georgie had kept their head down we could still be enjoying them today.
 
So are Whittakers brave or stupid? To go against a company with annual revenue of NZ$14 billion is a risky venture. Will they go the same way as Georgie Pie? Is the Peanut Slab in danger of extinction?
 
For once the answer is not in the hands of the clever marketers and multinationals it is in the hands of us. We have a choice - standing there in the supermarket aisle deciding which block of chocolate to buy will decide the outcome of this war. Cadbury or Whittakers - whose side are you on?    

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