Chocolate confectionary - 5 Flashcards
How were Cadbury impacted by rising raw material costs in the easter of 2008?
- Dairy Milk maker Cadbury Schweppes suffered a loss of market share over the Easter of 2008 after it refused to cut prices.
- Cadbury Schweppes, which owns brands such as Creme Egg and Green & Black’s, is under pressure from rising raw material costs.
How has penetration pricing negatively impacted Hershey?
- Penetration pricing has been proven to work best in a saturated market however for companies such as Hershey Chocolate it has been unsuccessful due to consumer perception.
- There is a consumer perception that all chocolate is not the same therefore a lower price would indicate a low quality product whereas Hershey is not a low quality product.
What pricing strategy do Cadbury use and why?
- Cadbury have high quality chocolate and spend a lot of money on marketing their beverages and new products (oreo dairy milk) therefore Cadbury use premium pricing for most of their products.
- Cadburys do also have lower priced products like perk, five star and eclairs which give the taste of Cadbury at a lower price.
- Cadbury has many different varieties of products in the chocolate segment which are priced differently based on the customer.
How has Cadbury been able to sell high volumes even with high prices.
- Cadbury dairy milk is considered a premium brand of chocolate as it has a position of gifting and therefore sells high volumes even at high prices.
- The cadbury celebrations pack sells in millions on any festival or on celebrations due to the fact it has a position of gifting and so can be purchased as a gift.
How is Cadbury promoted in India to maximise sales?
- In India the fact that chocolate is sweet is very popular and therefore the tag line for Cadburys in India is ‘Lets have something sweet’ in India, which means it is popular to have Cadbury’s at home or gift Cadbury dairy milk as a present during celebrations.
How do Cadbury promote each of its products differently?
- Cadburys promote each of its products different, for example Cadbury use the phrase you don’t buy a Bournville, you earn it.
- This again puts emphasis on being gifted Cadburys chocolate.
How do Cadbury cover many segments of the chocolate market with their boxes of heroes?
- When Cadburys were including Bournville in boxes of Heroes it had a major customer base as eclairs have a low-cost position, Bournville has a strong health positioning and dairy milk has a premium position.
What BTL marketing does Cadbury use?
- Its BTL marketing is very strong with its hoardings and banners resulting in very high brand recall as people will always remember the Cadbury colours and logo.
What ATL marketing does Cadbury use?
- Cadburys ATL marketing is also very strong, an example of Cadbury promoting using mass media is during the 2007 Rugby world cup where it cost £6.2million for Cadburys advert to be shown in an ad break for the final.
How do Nestle tend to promote and market their products?
- Nestle has always come up with unique marketing ideas, the overall promotion strategy focuses on extensive advertising and marketing for its individual brands and products.
How have Mars used a combination of promotional offers and ATL marketing to drive sales?
- In 2012 Mars introduced a promotional offer which offered a free bar giveaway where 1 in 6 bars were able to redeem a free bar, creating instant increased demand by consumers which then caused retailers to stock up on all of Mars chocolate bars.
- This promotional strategy was also supported by £1m media spend on TV advertising, PR and promotion in store to further raise awareness and drive sales.
How are servings in the chocolate industry changing?
- Servings are becoming smaller due to the rising costs of raw materials and the priorities of businesses to maintain profit margins through reducing cost per unit.
How are major producers starting to tap into the artisan segment of the chocolate market?
- Retailers are starting to improve the quality of their products, marketing them as artisan or hand-made to market their quality.
How have major chocolate producers adapted their products to the rising cocoa prices?
- Due to the rising price of cocoa, brands have advertised that their products have ‘more milk, less cocoa’.
- Those within the industry have utilised the scarcity of cocoa to advertise their products as healthy.
How are small chocolate brands adapting their products to improve sales?
- Health concerns have lead to products specifying their ingredients
- Some smaller brands are incorporating unconventional ingredients into their chocolate bars to create a niche e.g. Artisan chocolate.
