Cadbury Limited Business Plan

Cadbury Limited Business Plan
Cadbury Limited is a wholly owned subsidiary of Schweppes plc. It produces the finest quality confectionery; chocolate, sweets, cakes, drinks, yoghurts, ice creams and promotional material for all its products. Cadbury Limited was first located in the middle of England, Birmingham. Then merged with Schweppes and formed new sites. - Bournville, Birmingham - Somerdale (near Bristol) - Chirk, (North Wales) - Marlbrook (Herefordshire) - Minworth (Birmingham) - London - Belfast - Paisley It currently employs 4,000 employees, each working in many different departments within the company. Its mission statement is "Cadbury Schweppes governing objectives is to maximise returns to shareholders. In support of this, Cadbury Ltd. Aims to be Clearly The Best and be seen to be Clearly The Best by consumers, competitors and share owners. 80% of employees own shares through various share ownership/share save schemes". Cadbury?s confectionery is available in a wide variety of retail outlets, form traditional ctn (confectionery, tobacconist and newsagent) and grocery trade to leisure centres, garages, diy outlets and off licences, with well over 150,000 places able to cater for the British passion for chocolate.
History of Cadbury?s Limited In 1824 a young Quaker, John Cadbury, opened a shop at 93 Bull shop in a fashionable part of Birmingham. This one-man business, trading mainly tea and coffee, was to be the foundation of Cadbury limited- ? the first name IN CHOCOLATE?, today one of the world?s largest producers of chocolate. For over 100 years Cadbury was essentially a family business and although non-family directors were appointed for the first time in1943, the company retained many features of a family business until 1962 to form Cadbury Schweppes plc. Cadbury Limited is the confectionary division of this international company. In 1847 the enterprise had prospered to a large factory in Bridge Street, Birmingham. John Cadbury took his brother Benjamin into partnership and the family business became Cadbury Brothers Birmingham. In 1850, John Cadbury?s sons had joined the business as well, George and Richard. In 1889 John Cadbury sadly died leaving the business to his sons. The business prospered after many daunting years when the two sons took on the business. The business moved to Bournville after out growing the Bridge Street factory, the work force had risen to 200 after 32years at Bridge Street. From then the business grew and grew. Following the two brothers death in 1899, the business became a private limited, by 1899 the business ad almost trebled in size, employing over 2,600 employees. Due to the formation of the private limited company, Bournville entered an era of scientific management, introducing new ideas ? analytical laboratories, advertising and cost offices, a sales department, works committee, medical department, pension funds, education and training for employees. After WW1, there was a rapid change in industrial technology, the Bournville factory was rebuilt and equipped for mass production and the luxury of chocolate became well within the financial reach of the majority of the population. Several factors led to reduction of process for chocolate- raw materials cost, processing efficiency and lower transport costs. In 1919 Cadburys Brothers merged with J S Fry & sons of Bristol whose product range complemented that of Cadbury. Due to this, Cadburys expanded more, a factory in Bournville and now in Somerdale near Bristol. Cadburys today ====== Always in the forefront of production developments, Cadbury has introduced the most advanced processing technology and management information and control techniques to it chocolate business. Three chocolate factories operate in the UK- the moulded factory producing chocolate bars, the assortment factory producing chocolate plus Easter eggs and crème eggs, both situated in the original Bournville site. The Somerdale factory near Bristol produces count line bars such as double decker, crunchie, and fry?s turkish delight, while Flake, Time out, and Twirl are made on specialised plant at the Cadbury plant at the Cadbury Eire Factory. All factories are open 24 hours a day producing Cadbury products to the highest standards of quality control. In the assortments factory, there has been a major revolution of the packaging system, where chocolates were previously individually packed in boxes by hand, machines now handle them automatically. Cadbury Limited ? The Business. A short definition about the different types of businesses. ? Sole Trader. Owned by one person who also controls it, i.e. manages it, may employ others. Access to finance is fairly limited; they use own personal savings or a bank loan. Has unlimited liability, as owner is personally liable. As a sole trader, the business is unincorporated, so no legal requirements in setting up a business. The owner retains profits; they don?t have to share them, although they are also fully responsible for losses. ? Partnership. More than one to 20 owners, joint ownership, so they share responsibility and control. Due to the amount of partners, each can make a contribution to finance; this gives them a bigger base for raising finance. The company is unlimited liability, this means all partners are liable for debts. No legal requirements so unincorporated. Profits are shared by equally through all partners; all partners are liable to losses. ? Private Limited Liability. Shareholders are owners and have degree of control; the business can?t be lost to outsiders. More finance can be raised as no limit on number of shareholders. The company has limited liability so shareholders are prepared to risk investing more. Private limited liability companies have many legal requirements; memoranda of association, article of association. Profits are shared out amongst shareholders, according to their share holdings. ? Public Limited Liability. Shareholders are owners; they appoint directors to control- managers. However often get a divorce of ownership and control so shareholders and management differ on matters. Huge amount of money can be raised through the issue of the stock market. It can also retain some of the profits. The company has limited liability, only on the extent of their investment, as limited liability the company has its own separate legal identity. Legal requirements are the same as private limited liability; memoranda of association, article of association. So what type of business would Cadburys Limited come under? =============== Looking back at the history of the business, we can identify that the company has been through many different types and characteristics of businesses. When Cadburys was first established, it would come under the characteristics of a sole trader, as one man (John Cadbury) opened a small shop in 1824 on the streets in Birmingham. As a family business also called ?The one man business? then changed hand to partnership, when he took on his brother- Benjamin Cadbury and the family business name changed to ?Cadbury Brothers Birmingham?. Later on down the line in 1850, the business then changed hands from the original owner- John, down to his two sons, Richard and George. This did not change the type of business, but we must remember that the business has already had many people in control of this ?family? business. In 1899 the two brothers died unexpectedly, so the business then quickly changed to private limited. From that day onwards Cadburys Limited has been a public limited business after changing in 1962, letting employees own shares within the business. Currently Cadburys employees own 80% of shares. Cadbury?s Dairy Milk. Cadburys ltd. has many famous brands and Cadbury?s Dairy Milk milk chocolate, today is the most popular moulded chocolate in the U.K, but lately sales have been decreasing. Milk chocolate for eating was first made by Cadbury in 1897 by adding milk powder paste to the dark chocolate recipe of cocoa mass, cocoa butter and sugar. This was not the usual taste we get now; this was a dry coarse chocolate, not milky or sweet. There was a great deal of competition from foreign countries, French and Swiss chocolates being the main competitors. A considerable amount of time and money were spent on research and new plant designed to produces the new chocolate in much larger quantities. A new recipe was formulated incorporating fresh milk and new production processes were developed to produce milk chocolate. By 1905, they had finally cracked the recipe for milk chocolate. A huge launch for the new product went out. By 1913 this was the company?s best selling line; by the mid-twenties, Cadbury?s dairy milk gained its status as the brand leader, a position it has enjoyed ever since. Today more than 250million bars of dairy milk are made every year and sales reach over £100million in value. During 1928 and 1933, Cadbury Dairy Milk milk chocolate, grew, the company had decided to make the chocolate even better by adding new ingredients; nuts and fruit. Cadbury?s Fruit and Nut, and Cadbury?s Whole Nut chocolate were launched to increase popularity and sales. Cadbury Dairy Milk is a confectionery product, coming under the necessity category, along side; cigarettes, alcohol and fuel. [image] Task 2 Cadbury. Cadbury develop its products around many segmentation in the market e.g. age, gender, family characteristics and social class. For instance, Cadburys have developed a whole range of chocolate products for the younger generation. Developing some of the most famous children?s sweets like; chocolate buttons, chomp, curly whirly, freddo and taz, all being relatively cheap for young children to be able to buy with their pocket money. Also Cadburys have developed a product which ?brings the family together? with its family sharing bags; Giant button, Crunchie Nugget and Just Chocolate Variety Mini?s being just some of the wide range they produce. Marketing Strategy. ======= An understanding of customer needs helps a business determine how to price, promote, and place a product into a market. Information gained from marketing research by a company may indicate that the most likely buyer to a new product will be a female. Finding out about the needs of each consumer segmented into the market should allow the company to decide how to target the market and the best marketing mix for the consumers being targeted. This will then help the business to decide how to promote and sell the product. Primary Data There are a number of different filed research methods a business can use; Questionnaires, personal interviews, telephone interviews, postal survey, observation, focus groups, and consumer panels. Each of these can find out what consumers want and need from the business. Field research is also called primary data. This research can either be carried out by the firm or by a market research agency. There are many advantages to using primary data, but the main one would be that this information they collate, could only be accessed by the organisation that researched it. Therefore primary information can therefore be used to gain marketing advantages over rival firms. The main disadvantage of primary information is that it can be very expensive to collect. Most primary research is gathered by asking consumers questions or by observing their behaviour. This involves, surveys, questionnaires, observation and focus groups. Questionnaires Questionnaires are the most popular of the field research methods as they can be used in many different ways, for example- personal interviews, telephone interviews and postal surveys. When conducting questionnaires, there are many things I must keep in mind. If it is poorly designed, it might not obtain the result I am looking for. Things I must keep in mind when conducting it. ? When framing questions. -I must consider the language used in the questionnaire, (simple and specific). No jargon, slang or local terms, as some people may not understand them. -I must ask only one thing in a single question. -Make sure questions aren?t ambiguous. -Don?t ask people to recall events that happened long ago. -Don?t ask people to make complicated calculations. -Include questions that are only totally relevant. -Don?t ask people to speculate or imagine something they have no experience at. -Avoid very personal questions. E.g. ?What age are you?? You could then reframe that question to say ?Which age barrier do you come under?? ? The length or my questions. - There are no set guidelines but questions should be thought about depending on which environment your questionnaires if going to be filled out. E.g. street interviews should be kept short, whereas a survey filled out in a health farm could take a lot longer. ? The layout of my questionnaire. - This is extremely important, the layout needs extreme care and attention, to make sure that it is set out in a logical order, and people from all ages can read to wording and paragraphing. ? Recording answers. - Qualitative answers and opinions are needed; to do this you can use open-ended questions. These questions allow for more detailed answers. - Qualitative responses result from closed questions which may take a variety of forms - Yes/No - Multiple choice questions - Numerically scale e.g. 1-5 Questionnaire- Marketing. ===== For my A.V.C.E. Business coursework, I have to prepare a marketing strategy for a new product or an existing product. For a well-known company, I have decided to do this project on Cadbury?s limited and specialising on the well-known chocolate ?Cadbury?s Dairy Milk milk chocolate?. Please can take a few minutes to fill in this questionnaire, as this is a vital part of my research into what consumers want from the chocolate market sector. =============== In this questionnaire, I am going ask you a few questions about your preferences for chocolate. There will be multiple choice questions, where you may have to tick an answer more than once, and open ended questions which you can give your own opinion about your answer. Q1 Which age would you come under? The framing of this question stops the question being as personal as it could have been if had said ?what is your age?? 0-5 6-12 13-19 20-30 31-45 46-55 56+ Q2 Please could you tick which are Cadbury?s chocolates below This question shows me how many people do know Cadburys products. Dairy Milk Fuse Yorkie Kitkat Snickers Lion Bar Double Decker Crunchie Milky Way Bournville Milky bar Terry?s Wafer This question show me how many people on average have tried this chocolate in the questionnaire. Q3 Have you ever-tried ?Cadbury?s Dairy Milk?? Yes No Q4 What would you say was your favourite Cadburys Chocolate Bar? (Please tick up to 3 choices) This will show me what consumers favourite Cadburys chocolate bar would be. Dairy Milk Twirl Fruit and Nut Wispa Dream Crunchie Boost Bournville Flake Spira Caramel Snowflake Q5 Who do you believe are Cadbury?s main competitors? These shows who consumers believe are Cadburys main competitors. Nestle Mars Galaxy Terry?s This shows which chocolate consumers would rather be in pressure. Q6 Which chocolate bar would you rather buy if the choice were only chocolate bars? Galaxy Dairy Milk Mars bar Q7 How much money would you say you spend on chocolate each week? This will show me how much money consumers buy on chocolate. £0 ? £1 £1 ? £3 £3 ? £5 £5 ? £7 £7 ? £10 £10 + This will show me if Cadbury?s pricing is too high Q8 Do you believe that Cadbury?s pricing is higher than other companies? Yes No Q9 In your opinion how much would you pay for the normal 49g bar of dairy milk This will show how much consumers would spend on their chocolate bars if they had the choice. 5p ? 10p 10p ? 20p 20p ? 30p 30p ? 40p 40p ? 50p 50p + Q10 Do you believe that now people have become more health conscious that the need for a chocolate snack had declined? This will show me if there needs to be a healthier option Yes No Q11 Which would you rather buy for a quick snack? This will show which consumers would rather buy Fruit Chocolate Crisps Thank-you very much for participating in this questionnaire. Results of the questionnaire. 1. Which age would you come under? [image] 0-5 3 6 13-19 17 20-30 10 31-45 4 46-55 5 56+ 5 2. Please could you tick which are Cadbury?s chocolate chocolates below [image] 3. Have your ever-tried ?Cadbury?s Dairy Milk?? [image] Yes 50 No 0 4. What would you say was your favourite Cadburys Chocolate Bar? [image] Dairy Milk 50 Fruit and Nut 12 Dream 6 Boost 5 Flake 16 Caramel 13 Twirl 18 Wispa 3 Crunchie 7 Bournville 12 Spira 5 Snowflake 3 5. Who do you believe are Cadburys main competitors? [image] Nestle 50 Mars 32 Galaxy 12 Terry?s 0 6. Which chocolate bar would you rather buy if the choice were only chocolate bars? [image] Galaxy 6 Dairy Milk 23 Mars 21 7. How much money would you say you spend on chocolate each week? [image]£0-£1 9 £1 ? £3 19 £3 ? £5 10 £5 ? £7 7 £7 ? £10 3 £10+ 2 8. Do you believe that Cadbury?s pricing is higher than other? [image] Yes 24 No 26 9. n your opinion how much would you pay for the normal 49g bar of dairy milk? [image] 5p-10p 2 10p ? 20p 6 20p ? 30p 10 30p ? 40p 23 40p ? 50p 5 50p + 4 10. Do you believe that now people have become more health conscious that the need for a chocolate snack has declined? [image] Yes 6 No 44 11. Which would you rather buy for a quick snack? [image] Fruit 12 Crisps 26 Chocolate 10 Analysis of results Which age category do you come under? For this questionnaire I asked a whole range of ages to answer it, this is because I am trying to find out where the niece of the market is in the confectionery industry. If I focused on just one age group, then the results wouldn?t show the whole range of consumers. The question was asked in a non-personal way, by putting groups of ages down which they had to tick. This wouldn?t discriminate the age of the consumers. The results of this question came out that I asked a lot more teenagers than any other age category. This therefore means that the results could be biased to one age category. Although the results could be siding to one age group, I still asked enough people from the different groups to get a clear analysis of the niece in the chocolate industry. How many people know which were Cadbury?s products? This question was asking whether people actual could distinguish between Cadbury?s and other competitor?s products. Cadbury produce all Dairy Milk, Double Decker, Fuse, Crunchie and Bournville. The results were very clear, 100% knew that Cadburys produced Dairy Milk, while one chocolate bar people couldn?t distinguish between Cadburys producing the ?Milky Bar? or ?Nestle?. 58% decided to put Cadburys due to the name being relatively the same to Cadbury?s Dairy Milk, while in fact the answer is ?Nestle?. The main Chocolate bar, which only 18% knew were Cadbury?s, was the ?Double Decker?. This was a disappointing result as the Double Decker which got a much lower result has been the most recent of them all to come out, in 1976. This had a huge publicity stunt. 92% knew that Cadbury?s produced the ?Crunchie? bar, this is one of Cadbury?s most popular chocolate bar, along side the ?Flake? and the ?Twirl?. This shows that most consumers know the well advertised and published chocolate bars. The Bournville chocolate bar was very shocking result, 58%, just above half that Cadbury?s produced Bournville, this was in fact there second chocolate bar ever to come into the market, in 1908. This result was the same as the Milky Bar answer, when Cadbury?s don?t even produce this Chocolate bar. The Fuse chocolate bar got 72%, when I asked the interviewees why they knew the Fuse was Cadbury?s rather than the Double Decker, they answered ?it?s in the miniature hero?s box?. The ?yorkie?, ?snickers?, ?Milky Way?, ?kitkat?, ?lion bar?, and ?terry?s wafer? had quite low results. This shows that these brands are quite popular and well known, from their producers. Have you ever tried ?Cadbury?s Dairy Milk?? These results were a very pleasing result, this was because 100%knew that Dairy Milk was produced by Cadbury?s. What would you say was your favourite Cadbury?s Chocolate Bar? In this question, I asked the interviewees which was their favourite Cadbury?s Chocolate Bar. I gave them 12 Cadbury?s Bars to choose from and then I let them tick up to 3 boxes. 100% said that their first favourite chocolate bar was Dairy Milk. Although they say this, from looking at the recent tables showing where Dairy Milk is situated in the market, Dairy Milk has declined and loosing popularity. The next favourite chocolate bar was the ?Twirl? with 36%, although this is a dramatic drop from Dairy Milk it still shows that the twirl is a increasing popular chocolate bar, that consumers seem to notice more. A close follow up of the twirl is the flake, with 32%, when asking the consumers why they chose the flake, they answered that "its the original dairy milk, but nicer and more fluffy (12 year old girl)". The Caramel bar was next with 26%, then together ?Fruit and Nut? and ?Bournville? with 24%. A sudden drop then happened, with the next 6 chocolate bars. Crunchie, Dream, Boost, Spira, Snowflake and the Wispa all less than 10%, with the lowest having only 3%. These 6 products haven?t had as much promotional advertising as the other 6. This then means that advertising is a key feature of bringing out a new product into an existing market. Who do you believe are Cadbury?s Main competitors? This question is to ask the consumers who they believe Cadbury?s main competitors are. This means that we can now looking the marketing strategies of these companies and try and make our strategy better and more efficient. I gave the interviewees a number of possible companies that, to date that are Cadbury?s main competitors and ask whether they think the same. They could choose as many as they wanted, this will mean the results will be more unusual than the other questions. 100% of the people I asked, thought that Nestle were one of their main competitors, 64% thought that Mars were, 24% thought that Galaxy and 0% thought Terry?s were. This can now tell me that I need to research into Nestle?s marketing strategies, and advertising skills (as this is one of the main aspects for consumers to see a new or existing product). Which chocolate bar would you prefer if the choice were only out of these three? This question is to find out which one they would prefer if they were on the spot (impulse buying). 46% of the people I asked said they would but Cadbury?s Dairy Milk if they were on the spot, while a close 42% said they would buy a Mars Bar, and a low 12% said they would purchase a Galaxy chocolate bar. From looking at this data I now can see that Mars are in very close competition with Cadburys and Cadburys need to stop and move away from being as close as they are with Mars. How much money would you say you spend on chocolate each week? This question will help me work out on average what the weekly intake of chocolate is and how much they spend on chocolate. On average the most people spend on chocolate a week is £1-£3 as this had the highest percentage with 38%. Then with a 20% came £3-£5. Although this question doesn?t help me with my strategy, this will give me an idea of how much people would want to spend on chocolate a week. Do you believe that Cadbury?s pricing is higher than other companies? This question is to show me whether the consumers believe that the prices of Cadbury?s products are higher than other competitors and whether they would pay for quality or quantity. The results were very close, prices being too high was 48% while prices being right was 52%. This now show me that in my strategy I should look at the prices of the product and whether quality and quantity is both there. In your opinion how much would you pay for the normal 49g bar of Dairy Milk? This question is to show me what consumers believe that the 49g bar of Milk Chocolate should be, this is essential to the business as if consumers think that prices are too high, then they wont be purchasing it. At the precise recommended retail price for a 49g bar is 35p. The results were 46% believed that the price should be between 30p-40p, while 20% thought it should be 20p-30p. This now shows me that the prices should be thought and looked at for my new product. Do you believe that now people have become more health conscience that the need for a chocolate snack has declined? This question is asking the consumer whether there is a need for a new product to the market and if so, whether is should be more healthy. 88% said that there hasn?t been a decline in the need for a chocolate snack. While 12% said there was. From this information, I can see there even though is a great difference between the yes and no answers, I should still look at a healthier option. Which would you rather buy for a quick snack? This question focuses more around impulse buying, seeing a product and buying it without thought. Impulse buying contains quick snacks. When asking the interviewees which they would rather buy, 52% said that they would rather buy crisp compared to the 24% saying fruit and the very low and disappointing result of 20% saying chocolate. This now shows me that we need to advertise and promote more on the impulse buying sector of the market and try to promote in the ctn (confectionery, tobacconist and newsagents). Secondary Data Secondary research can also be called ?desk research?. This is information, which already exists in some form. It may be, existing business documents or other publications. These could be - Existing market research reports. - Sales figures - Reports from members of sales force resulting from direct contact with customers - Internet data - Stock movements - Information from competitors - Government publications - Data from customer services - The European commission - International publications - Commercial publications - Retail audits - General publications The confectionery market 70% of the total confectionary market is chocolate and all but 7 of the 50 brands are manufactures by Cadbury, Rowntree or Mars with many of the top favourites being long established brands. Cadbury continues to be the No.1 UK confectionary manufacturer with its position being further strengthened by both organic growth and acquisition. This diagram shows the weekly consumption of confectionery per person. [image]Over 90% of the population eat confectionery and 75% eat chocolate at least once a week, giving the U.K the highest consumption of chocolate per head in the European Economic Community. Cadbury?s Dairy Milk. Below is the table showing where Dairy Milk stands in the national table of Chocolate Brands. From looking at this, I can see that the KitKat and Mars Bar are way above Dairy Milk earning more than £25M than Dairy Milk. From researching and looking at the top 30 Chocolate Brands in earlier years, Dairy Milk have always been the top most favourite brand, earning well over £100M. Cadbury Rowntree/Nestle Mars Others £100M+ Kit-Kat Mars Bar £75M+ Dairy Milk Twix £50M+ Roses Quality Street £30M+ Cream Eggs Flake Wispa Crunchie Milk Tray Whole Nut Twirl Fruit and Nut Aero Snickers Milky Way Maltesers Bounty £20M+ Boost Double Decker Caramel Smarties Yorkie Milk Black Magic After Eight Dairy Box Terry?s All Gold Thorntons Continental Looking at this in detail, I now know that my marketing strategy has to be to increase the sales of Dairy Milk and get there well known and famous reputation of being the best chocolate of the country. Multiple Impulse The Multiple Impulse channel is made up of the various sub channels - convenience, Forecourts, Multiple CTN?s, Off Licences and Motorway Services. Convenience:7 The UK convenience sub Channel is worth £19.2billion and accounts for one fifth of total UK grocery sales. Convenience stores are typically uses to top up/distress/impulse purchases and saving effort and time in store critical. The biggest opportunity for growth within the confectionery category is to convert existing footfall into increased sales: 28% of consumers look at the confectionery fixture within convenience stores and of these 80% go on to make a purchase. Bringing confectionery to the consumer?s top of mind can be achieved by giving the product category more visibility and by giving merchandising changes. The convenience sub channel has been buoyant growth in confectionery in 2000, particularly within the seasonal and kids product sectors. [image] [image] What you see is what you sell? What you see is what you sell, or ?wysiwys? has become a major strategy within the Multiple Impulse trade channel, driven by an enhanced knowledge of shopper behaviour and focusing on three central themes: ? range- Segment the range according to consumer needs and focus on the top sellers. ? location- Identify the destination channels within the store, leveraging the impulse nature of confectionery within theses areas. ? communication- Highlight confectionery category segments and secondary sites through the use of high impact, themed and relevant Point-of-sale. [image]Confectionery sub-categories such as ?Gift? and ?Kids? have benefited from high impact range and display in accordance with the principles of ?wysiwys?. With use of secondary display sites, retailers can drive confectionery sales even further due to the impulse nature of the confectionery category when consumers see confectionery they buy it. [image] The Cadbury?s Dairy Milk unit is ideally placed within the retailer?s off-licence or magazine stands. The magazine unit for indulgent countlines allows female consumers to easily but themselves a treat to enjoy whilst reading their favourite magazine. Task 3 Marketing Strategy. Factors effecting a marketing strategy. The objectives of the business: The marketing strategy that a business uses must reflect the objectives of the business as a whole. These strategies must therefore be consistent with the wider corporate objectives of the organisation. However marketing strategies are not always secondary to corporate objectives. The Strategies of competitor businesses: Other businesses take into account their competitors strategies when setting down their marketing strategies. The attitudes of key decision makers within businesses: Strategies are likely to be influenced by the attitudes of decision-makers towards matters such as the desirability of risk and change. Such attitudes are influenced by the environment within which a business operates, but also the views of managers and directors and the culture of the business itself. External influences. External influences can range from the consumers, to the press right up to the health and safety laws. These external factors can effect everything Cadburys do with advertisement, design products, and the selling of the finished products. The kind of advertisement Cadburys does can benefit Cadburys but may not be suitable for the consumers. For example, in April this year, Cadbury?s developed a new market strategy to boost their sales as well as helping the public get fit. The developed a new advertisement, in which if you ate how ever many Cadbury chocolate bars, you would collect tokens off the back of them, these tokens would then be used to get free sports equipment for schools and at home. This campaign was used to get the younger population to be fit and not lounge about at home watching the television. The press looked into this campaign and then realised that to get just a football from these vouchers, you would have to have collected about ten vouchers, which meant that you would have to of eaten about ten chocolate bars to do so. They wrote an article about this in the ?Daily Mail? where many more people realised the extent of the campaign. Shortly there was uproar about the campaign and Cadburys had to stop it, as the sales for Cadburys had declined from just a short article in a newspaper and the consumers had complained saying that it was false advertisement. From looking at this campaign, I can see that the most generous campaign of giving the consumers sports equipment for them buying there products can turn into a nasty display of the press getting involved and stirring trouble. While developing a new marketing strategy for Cadbury?s I must take into account the effects of external influences, when developing new products and bringing them out onto the fast pass market of confectionery. External influences affecting the development Of the marketing strategy. swot The purpose of swot analysis is to conduct a general and quick examination of a businesses current position so that it can identify preferred and likely directions in future. swot analysis involves looking at the internal strengths and weaknesses of a business and the external opportunities and threats. Strengths Cadburys have many strengths, these are:
They are one of the leading brands of confectionary worldwide.
From looking at my primary research everyone have heard of
Cadbury?s ltd in some way.
They produce high income annually.
They generate a high business standard and have a good reputation.
They have a good competitive nature and cause other leading brands
to learn from their strategies.
Weaknesses Although Cadbury?s are a well reputed business, every business has flaws in some part of the company. Whether it is factors that cause losses, hardships, disputes, grievances and complaints for a business these all can causes a businesses reputation to fail. If you look at the history of Cadburys, the actual company has changed managerial hands many times, from the original owner to the large public limited company it is now. Through all these changes there have been new ideas and new ways of running the business which has also proved to be a weakness as productivity has been down during the hard times. Now that the company has calmed down with ownership, new ideas have been lost and they have kept with the same old products for many years. This has been a weakness as profits have been down due to no new up and coming ideas have been thought of buy the marketing section of the company. Last month there have been many complaints from the public and the press about there advertisement about sports equipments for children, this was so because they had a good idea of giving away sports equipment to the less fortunate children, when they brought Cadburys chocolate bars. The problem with this was that you would have to eat about 20 chocolate bars to get one football. Opportunities There are many directions Cadburys could take in the future, for example they could go into the main meal or dessert type of confectionary like Heinz Bake Beans have with their product lines. This would be quite easy to a company of this size as they have got the reputation, the money and the fact that they are a large company. Threats The main threat to Cadburys is competition. Due to the fast pass of the confectionary section there are many competitors. Each competitor has new ideas and has a different marketing strategy to the rest, one companies may be better than the others so there has to be an increase in risk taking. If risks are to be taken place, by entering a new product into the market then there may be some profit loss as marketing the new product may cost a lot of money and also the product has to be suitable for customer needs. Rising costs of raw materials may also cause a threat to Cadburys due to inflation, this will affect the business as prices will have to be increased for the production and therefore if they don?t increase the price of the final product then they will make a loss. By increasing he price of the product then they may loss customers to other competitive brands as their prices may be lower. This will affect my final marketing strategy as I will have to look at the effects of the rising inflation of the raw materials to the prices customers would be happy to pay for the product. pest The pest analysis will examine the external environment and the global factors that may affect a business. It can provide a quick and visual representation of the external pressures facing a business, and their possible constraints on strategy. Political There are many political developments Cadburys will have to look at when producing the final marketing strategy, both regionally, and nationally and also internationally. For instance Cadburys will have to look at the Weights and Measures Act which states that you have to have on the labeling of the package a round about weight of the final product. This is an international Law which all businesses have to keep to. Regional factors can come from just environmental acts, where their factories are built and whether it is built on an environmentally stable area. Also will the government increase financial support to such a large company if rising costs do occur? Economic The marketing strategy will have to involve economic factors and their effect on the business. Consumer activity can change throughout seasons in the year, their spending patterns and willingness to spend can all depend on interest rates, and this will affect the strategy by having prices rising and falling and income monthly being vary. Does a new product have the need to come on the market? Economic variables which I have already briefly talked about can change the way customer needs apply. Inflation is the main, prices will go up for raw materials and production but customers wont want prices to increase in the final product. I will need to make a balanced price incase inflation does increase by a lot to stop there being a loss. Unemployment levels can also affect a company, if the company is situation in a low unemployment level area then it would be harder to find people willing to work the areas of Cadburys Company and will have to look away from the local public, but if unemployment levels are high then there may not be a need for more staff. Social If there is a social change taking place outside Cadburys then it might affect the way a strategy may be run or even designed, for example if there was a fall in birth rate and the life expectancy increased, then people will be living longer this will then cause a larger demand on confectionary for the elderly and middle aged consumers rather than the younger population. But if there was an increase in birth rates and a decrease in life expectancy then there would be a greater demand for confectionary within the younger population. People dieting will also cause a big problem. Statistics in the last few years have announced that obesity has increased; this therefore means that the demand for chocolate will have fallen as more people will want a healthier option rather than a chocolate bar. Due to fashion and taste people change their minds every month to want the rich and the famous eat and wear. Although chocolate is not directly involved, it will still affect the choice people make on which brand consumers will buy. Adverts and promotions can also affect the way people spend their money, if there is a famous actress on a Cadburys advert then people are more likely to want to buy that product if they think someone the admire is consuming it. Technological From the early days of Cadburys, technology has changed dramatically. It has become quicker and more efficient to this day. Production lines have been swopped for machines which can produce the whole product in one quick easy procedure. From this if extra demand is wanted from consumers then it will be easier to produce the product quicker than the original hand made chocolates. Communication has improved as well as marketing the product through word of mouth has now changed to advertising in magazines, newspapers, bill boards, television and even the internet. This will help with the strategy as it will be easier to promote the product to the consumers. Task 4 Marketing Strategy. The marketing strategy I wish to purpose it to develop a new product where the famous Cadburys Dairy Milk is the main ingredient but add other ingredients to differentiate from other Cadbury?s products as for example, Cadburys have brought out a Cadbury?s Dairy Milk bar with biscuit. The sales for this product was high to start off with but after a few months the sales declined as the promotion had slowed down and not so popular. So with my new product I am going to increase promotion and keep it at a steady rate so that it doesn?t just come into the market with a bang and then is forgotten about. I am going to promote the new product in a cycle: where at the launch date I am going to promote the product so that the consumers can see what is offered and then after that keep the advertisement going so that it is not forgotten and put behind other existing products. The product. My initial design idea was to produce a healthier chocolate bar where I would include fruit and fibre, but also include the all-important Dairy Milk chocolate. After asking different age groups about this idea, the all said that Cadbury?s had already designed a product like this, it was called the ?Brunch Bar?. So I decided to focus my ideas on another design. For my next design I looked at the results of my questionnaire, 76% of the people said that they would rather buy crisps and fruit as a quick snack instead of chocolate, so I focused my next design around a quick snack option. For this I would have to look at the 4 P?s, Price Promotion Product and Place, as these would be the main influences on my product if it were to sell. I looked at the design of the packet of crisps and realised that it was lots of little products incorporated into a bigger product. From looking at this I realised that I could design a product, which had Cadbury?s Chocolate cut up into segments and put into a bag. Where the consumers could eat them in there own time and leisure and also pick a bag of them up for a quick snack during work or at school. I have managed to design a new product and thought how I am going to do the promotion of the product, I now have to think about the pricing strategy, and where to sell the product. From looking at one of the questions in my questionnaire, it showed that people would pay around 30-40p for the average 49g bar of Dairy Milk. For this product, I would have to keep the prices relatively the same as the average bar of chocolate but also think about the pricing for a packet of crisps as now we would be in competition with other quick snack companies as ?Walkers? and ?Golden Wonder?. Their usual prices for a 35g packet of crisps is 27p, while on the other hand, the ?McCoy? crisps are around 49p for a bag of 55g. With this information I can therefore develop a pricing strategy for this new product. For a 50g bag of this new product, the rrp would be 38p. But as a promotion, I would decrease the price, so that it was there was less competition for the beginning product, and gradually bring the price up to the rrp when the promotion gets to a steady pass. Where is the product going to be sold? ========== The product will be sold in all CTNs (confectionery, tobacconist and Newsagents), garages, leisure centres, supermarkets, diy outlets and motorway stops. I have chosen these places, as these are the most likely places people will stop and buy a quick snack from.

Cadbury Limited Business Plan 8.6 of 10 on the basis of 3093 Review.