Constructing An Essay On Schweppes In Australian Confectionery Markets.

This assessment addresses the following subject learningoutcomes:
a) Identify and evaluate key theories and principles of practical marketing strategies
b) Critically evaluate client needs with regard to the creation of value for the organisation
c) Critically evaluate the impact of the application of the marketing mix to the target market

Overview of Cadbury Schweppes and the Australian Confectionery Market

The main aim of this report is to construct the model for a company Schweppes in the chocolate confectionery story in emerging countries like Australia. The company will be examined in the food sector. According to market industry analysts, company core business is comprised of production as well as trade and extensive range of delicious chocolate products. The company will be offering the diversified portfolio of products and which will comprise of different chocolate bars with different taste: hazelnut, milk, dried fruits, rice crisps and many more. Initially, the company will be working for the establishment of a strong distribution network in Australia. Valuation process will play key role in determining of the investments and meeting with the financial goals. It is essential to determine whether investment must be made in this particular company, for planning the merger and acquisitions.

Australia is an emerging market country. Emerging markets show the large volatility when compared with similar companies in mature and stable and developed environment. Volatility implies risk and risk implies less business and product value in unpredictable areas. Emerging markets have economies where regulations and conditions must be stable for the operations of capital and market will differ from familiar conditions of the developed countries. Emerging countries like Australia will be offering plethora of opportunities. These markets will characterize the opportunities and risks and sound analysis will be indispensable providing the frontier where scholars can add value. The emerging markets have become substantially essential and giving the shape of the global economy. This involves attracting the investors from developed countries. The prime attraction of capital markets is heavily reliant over higher return opportunities and there is regular privatization.

Cadbury Schweppes is one of the largest sweet companies of the world. The merger of Cadbury with Schweppes in 1969 has become the major force in domestic and international markets. Cadbury has been operating the factories in Australia. Cadbury brand is leading the confectionery market in the consumer segment. Buyer behavior refers to the study of customers through which organization can upgrade the marketing strategies as to find about the psychology of consumers (Bozabal? & Kocaba?, 2015). Consumer buying behavior must be studied in a depth manner. Buying Behavior refers to essential tools that can help the marketers in understanding the perspective of customers keeping in mind the different theories and concepts. The buyer behavior will help the marketers for studying the consumer’s psychology i.e. how the customers feel about the products offered and select the different alternatives. The buying behavior will also take in consideration, how this target audience will be influenced through the environment. This environment will include social signs, social class, media, family background etc. Alternate marketers shall keep the different aspects while marketing of a given product or service (Kreiner, 2014).

Buyer Behavior will help the marketers on how the marketing experts will upgrade the marketing campaigns and how they will prove effective and influence the customer behavior. In the real world, consumer behavior will draw evidence through behavioral economics and purchasing the desired product.

Marketing Strategies for Establishing a Strong Distribution Network

Marketing Mix-

The marketing stimuli is required into consideration for exploring the consumer behavior. The 4Ps will be price, promotion, product and place (George, Owoyemi & Onakala, 2012).

1. Product- The product is the commodity which the customer will buy for satisfying the needs. The commodity can be tangible or intangible.
2. Price-Price is the marketing stimuli which will have an impact on the purchasing behavior of customers. Pricing refers to as best elements that shall be in mind for purchasing the particular service or commodity. Pricing refers to as best elements of the organization. This implies this is a distinguishing factors which and thereby the profit or loss for a given organization. Price of the given product will help in the identification of elasticity of demand, which will show impetus on demand and sales. When a specific enterprise will set the price for a particular product, the company needs to pay importance to the customer as well. Based on the particulars of customers, the pricing strategy can be decided- penetration, neutral or skimming pricing strategy must be followed. The concepts like differential value and reference value must be taken into account while setting the price(Jordan, 2012).
3. Promotion- Promotional aspects are the third marketing mix. This implies the communication used like advertisements, magazines, television and radio and public relations, trade shows, road shows and many more. This will help in the maintenance of personal relation. Advertising can be known as a form of communication which will make and the product makers will generate awareness regarding the product that is available in the market. Word of mouth, public relations, and publicity will help in improvising the footfall of a given commodity(Verma, 2015).
4. Place- Place refers to marketing stimuli and this will impact the buying behavior of customers. Place refers to location and products will be readily available for selling. Place has been playing a crucial element, whether decides the purchase of a specific product? The enterprise needs to keep the strategies such as intensive distribution, franchisee, or exclusive distribution.

Schweppes Cadbury products have been regarded as the prominent players in the confectionery market. Cadbury has been known for providing the world class products. Cadbury is one of the strongest brands and has associated with chocolate different variants. Schweppes majorly deals with different confectionery items like gums, chocolates and candy. This organization has been well known across the evolving markets. The positioning of the brand is strong and maximum numbers of people are enjoying this brand on daily basis. The success mantra behind Schweppes Cadbury is having a linkage with emotion of consumers. This success mantra will help Schweppes to stand apart when compared with other brands. The brand has been helping the organization to sustain the brand position and provide a competitive edge over others. In chocolate market, Schweppes enjoys more than 40 percent of the market share and Cadbury products will grow in upcoming years (Cadbury, 2015).    

The brand Schweppes operates in a competitive market. Irrespective of competitiveness, Cadbury has been developing the links in customers.

Value Chain Analysis- There are methodologies and strategies which are being taken through the Schweppes Cadbury to position itself as the leader in the confectionery market. Different marketing stimuli are likely to be implemented through which organization can achieve its target market and sustain the market position in the long run. The enterprise has broadened its product line. Different promotional marketing stimuli had been used by the Cadbury to grow in Australia. Diversification strategy refers to utilizing the best marketing stimuli which will help the enterprise to expand the risk of being not reliable on 1 brand. Improvising and working on the  product image can help Cadbury to attract more people towards it (Lacy, 2016).

Attractive and innovative packaging or launching the new product or utilization of the new logo will help the organization to incite the customers to try the new product. This will help the company enhance the level of sales and sustain the position in the chocolate market. Schweppes Cadbury had been using different mediums for the communication purposes like televisions, radio, newspapers, websites and radio. These are a few marketing strategies which are sued by Schweppes Cadbury to do promotions of the product. These marketing stimuli have the positive implications of same (Bowen & Sleuwaegen, 2017). Initially, this brand has been  linked as the brand for kids. Now, the Cadbury has widened its target segment and focus then shifts from kids and adult market. The Company has adopted the diversified product portfolio, which comprises of chocolate bars. The company should market the products to middle class customers (Kenny, 2011). Schweppes Cadbury had been striving hard to deliver value and therefore placing greater emphasis over the product quality. The customer needs must be satisfied at the affordable price range. The manufacturing process must be in accordance with the confectionery international standards. A special care must be taken regarding the quality standards and food safety processes. Monitoring of raw materials that are utilized in the production process, distribution channels and channel products sold in the market. The company must be working towards implementation of food safety, which comprise of quality management analysis (Ahmed, 2009).    

Studying Buyer Behavior to Understand Consumer Psychology

One of the key points that must be considered is human mind is capable of memorizing few things. To attract customers, the promotional stimuli must be utilized in the mannerism which can remain in the minds for a long period of time. The slogans, advertisement, tag lines will be able to help the customers with recognizing the brand that offers toffees, chocolates, milk powder etc (Mishra, 2017). The significant aspect is the difference with the present competitors in Australian markets is utilization of cocoa (in high percentages) and particular ingredients in the production of chocolates. The main companies operating in the chocolate confectionery market are Nestle and Kraft Foods. The companies are holding the strong position in the market and due to its long term trends of producing the confectionery chocolate products.  The prices are established through making comparisons with prevailing products. According to the value based concept, companies can face barriers of entry in the Australian confectionery market in terms of long term competition experience and investment costs. In order to be successful, the company must consider the opportunity for expansion of business operation in Australia regions.

Another competitor of Cadbury products is Mars. Mars is a privately owned enterprise. In the United States, it occupies 30 percent of the chocolate showcase. Mars has been the seventh biggest private business in the USA in 2014. Cadbury has incorporated into the gum markets like Dentyne, Trident and Stride and both of these organizations have the solid piece of this industry. Nestle is another nourishment brand on the planet that covers various subsectors of the market. This organization market occupies six percent in the USA (Zhang, 2014).

The exceptional surface and taste of Cadbury chocolate is dependent on the chocolate formula and preparation techniques which are remarkable with Cadbury. Methods must be enhanced constantly and innovation can empower the process to be tuned with advancing taste. The chocolate generation is advanced. In year 2014, Hershey had the market share of 45 percent in the USA. The company is a well-known brand in USA and earns more than 80 percent of annual revenue through the North America Market. The case of Cadbury and Hershey being rivals is mainly because of the licensing agreement. Hershey has made the payment of three hundred million dollars for occupying the rights of US operations. Hershey has been in the unique position (Stadler, Mayer, Hautz & Matzler, 2018). It is both the distributor and competitor of Cadbury products. Many believe that Hershey and Cadbury will merge. Kraft foods have been the top competitor of Cadbury (Dasgupta, 2011). This is an USA based company which is into manufacturing of the grocery products. This company- Kraft food has been trusted producer of the foods that will be acknowledged worldwide. The company will be producing the best food products and have high focus on high quality, taste and nutrition to eaters. It has been considered as the top 5 enterprises of the world. Kraft food production has been spanning across more than 20 countries. It is mainly due to high quality products and Kraft foods have been considered top Cadbury competitors (Ducassy & Prevot, 2010).

Product Diversification and Value Chain Analysis

Porter’s five forces model is a system recognition, which is utilized for the assessment of engaging quality of industry structure. The competitive forces assessment is through the recognizable proof of five key strengths (Tsakiridou, Mattas & Mpletsa, 2009)-

Industries rivalry- There are many organizations that are working against the Schweppes Cadbury. There are few contenders that are persistently creating the building up of items and advancing thoughts for making the contending harder. Competition will be dependably solid among the different organizations as the items can be made comparable in few cases.

Entry of competitors- This section will be bothersome on the basis as there have been entrenched organizations inside the market and organizations need to overwhelm with confectionery advertise with a specific sort of chocolates. This makes the section hard for new organizations and begins the ability to pull and have an impact over the clients by alluring the substitute and advertising strategies cost (Samoggia, 2016).

Threat of substitutes- The primary danger of Cadbury substitutes with other confectionery brands possess brands like they have been watching out for the well-recognized chocolates. Besides, this main deterrent which can influence the Cadbury creation is to locate the decent area and accumulation of pre-requisites and remote arrangement that can influence the operations (Gu, 2016).

Bargaining power of buyers- Cadbury has the substantial purchasing force and this is one of the biggest confectionery makers. Cadbury purchasers have been scattered all around the world. The subjectivity of items is not the questions and the general population rather than contenders’ number which will offer the similar products at low cost. Cadbury has been exceptionally precautious in selecting about costs and make clients fulfilled (Rajagopal, 2012).

Bargaining power of suppliers- Cadbury is pride in making and keeping the positive associations with its providers throughout the globe. This has buying power and haggling power and business intensely depends over the store network. Irrespective of the premise, the market is facing current rivalry, crude materials have been into like a drain, cocoa and exceptional fittings are adequate for fulfilling the Cadbury generation. Cadbury has its primary control over the providers and so are the vast organizations and Cadbury can utilize the economies of scale.

Technology impact- Technology has a strong influence over the brand and items can advance through web promotion. The assembling will help in the speedy creation. Economic components will influence the expansion rates and current subsidence and financial development will have a lot of impetus over it. There must be natural components that would influence, vitality and reusing of plastic and different items can be stuffed in plastic reusing and different items will be stuffed in recyclable bundle. Legal variables will have a likewise impact on what the customers consider (Radman, Kovacic & Markovina, 2006).

Cadbury Schweppes had larger market control in candy parlor segment everywhere throughout the world. Cadbury industry very well understands the prosperity depends fundamentally on estimation of Cadbury mark and also depends on the phenomenal notoriety for reasonable cost and item quality. In the present monetary state, it is essential to deal with the issue of limitations of cocoa and cocoa cost increments.

Attracting Middle Class Customers through Quality and Affordability

Conclusion

To conclude, the customer behavior study can help the organizations to upgradation the marketing stimuli and reading the students psychology to the customers. Australian people love chocolates and annual consumption are approximately 6 percent per person. Therefore, confectionery is the most popular snack in Australia. Chocolate accounts for 70 percent of the confectionery sales in this country. Cadbury is one of the biggest players in chocolate confectionery and enjoys market leadership in different major segments. More than fifty percent of confectionary is purchased impulse and chocolate buyers are within 25 to 50 years of age group. Consumer behavior is a process wherein customer buying behavior will be studied in depth manner. The marketing mix stimuli can help the customer brand and attract enough number of consumers by following the different aspects like product, place, promotion and price. As soon as, stimuli will be identified, different responses will be kept in notice will be affective, behavioral and cognitive response. The responses will help the company to find out which marketing mix needs to get highlighted and which will help enterprises in long duration.

References

Ahmed, T. (2009). Wyeth Deals Signal Diversification Strategy. Pharmadeals Review, 2009(1).

Bowen, H., & Sleuwaegen, L. (2017). Are International and Product Diversification Substitutes or Complements? Theoretical and Empirical Perspectives. Global Strategy Journal, 7(3), 241-256.

Bozabal?, S., & Kocaba?, C. (2015). Children Like Chocolates; Does Chocolates Like Children or Their Hearts?. The Indian Journal Of Pediatrics, 83(4), 363-364.

Cadbury, T. (2015). Collecting Magic. Material Religion, 11(3), 413-414.

Dasgupta, U. (2011). Are Entry Threats Always Credible?. The B.E. Journal Of Economic Analysis & Policy, 11(1).

Ducassy, I., & Prevot, F. (2010). The effects of family dynamics on diversification strategy: Empirical evidence from French companies. Journal Of Family Business Strategy, 1(4), 224-235.

George, O., Owoyemi, O., & Onakala, U. (2012). Hofstede’s ‘Software of the Mind’ Revisited and Tested: The Case of Cadbury Worldwide and Cadbury (Nigeria) Plc - A Qualitative Study. International Business Research, 5(9).

Gu, J. (2016). Causes Analysis and Countermeasures of Overlapping Food Products Processing Regulation-based on Overlapping Products Rights of Food Products Processing in China. Advance Journal Of Food Science And Technology, 10(3), 218-221.

Jordan, C. (2012). Cadbury Twenty Years On. SSRN Electronic Journal.

Kenny, G. (2011). Diversification: best practices of the leading companies. Journal Of Business Strategy, 33(1), 12-20.

Kreiner, D. (2014). Language Is Like a Box of Chocolates: A Cognitive Approach to Understanding MeaningLanguage Is Like a Box of Chocolates: A Cognitive Approach to Understanding Meaning. Psyccritiques, 5959(4141).

Lacy, N. (2016). Cadbury and The Camelot Caper. Arthuriana, 26(2), 110-117. Mishra, V. (2017). Creating Brand Success through a Niche Marketing Strategy: A Case Study of ‘LuvIt’ Brand of Chocolates. Siddhant- A Journal Of Decision Making, 17(2), 123.

Radman, M., Kova?i?, D., & Markovina, J. (2006). Croatian Consumers' Attitudes Towards Family Farm Food Products. Journal Of Food Products Marketing, 12(2), 79-88.

Rajagopal. (2012). Food Products Vending in Street Markets Held in Urban Habitat. Journal Of Food Products Marketing, 18(4), 325-352.

Samoggia, A. (2016). Healthy Food: Determinants of Price Knowledge of Functional Dairy Products. Journal Of Food Products Marketing, 22(8), 905-929.

Stadler, C., Mayer, M., Hautz, J., & Matzler, K. (2018). International and product diversification: Which strategy suits family managers?. Global Strategy Journal, 8(1), 184-207.

Tsakiridou, E., Mattas, K., & Mpletsa, Z. (2009). Consumers' Food Choices for Specific Quality Food Products. Journal Of Food Products Marketing, 15(3), 200-212.

Verma, D. (2015). Healthcare Consciousness with Chocolates. Journal Of Extension Systems, 31(1).

Zhang, P. (2014). Understanding Diversification Strategy in Venture Capital Market. Entrepreneurship Research Journal, 4(3). doi: 10.1515/erj-2013-0058