Cadbury s marketing objectives for the development of Fuse.
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Introduction Established markets generate intense competition during which new and innovative marketing strategies are required and new and existing products are developed. As a market develops, consumers become more experienced and discerning and look for more benefits from the products they choose. Although some organisations' products may appear unchanged at this developed stage of a market, the more successful businesses re-work existing brands and continue to develop new ones to meet changing consumer needs. The development of strong brands has always been a feature of the confectionery market. Cadbury set out two objectives for the development of Fuse: 1. To grow the market for chocolate confectionery 2. To increase Cadbury's share of the snacking sector The 'Fuse' concept was developed after market research identified the growth of snacking and a definite gap in the market for a more chocolatey snack. A number of ingredients were devised and tested following a survey which questioned consumers about their snacking habits and preferences. A research and development team was then asked to develop a number of product recipes which addressed the needs expressed by consumers. Not all products successfully emerge from the product development phase. Research and development involves combining various ingredients to develop potential new products. Considerable development time was spent on Fuse, carefully engineering the ingredients in order to deliver the right balance of chocolate, food elements and texture. More than 250 ingredients were tried and tested in various combinations before the recipe was finalised.
Market research is a process designed to link managers to consumers through information. It is used to identify opportunities and make better informed decisions about products which have future market potential. Market research has revealed that snacks play more of a functional role than one of pure indulgence. Research also shows that successful snack brands in the confectionery category tend to have more 'foody' values and often contain ingredients such as cereal, wafer, biscuits, peanuts and fruit to break up the chocolate delivery. Cadbury's philosophy is to continue as a driving force in the confectionery market, and thus constantly analyse its offerings for consumers. The core objective of Cadbury's innovation programme is to generate incremental volume for the company and achieve the vision of market leadership in every segment in which it operates. The role of innovation is critical as it allows Cadbury to develop ahead of its competitors in those areas of the market which are new or growing Brand name Like packaging, brand names play a critical role in the success of a product, by helping to create a product's 'personality'. The new product aimed to have broad appeal to 16-34 year olds, although it was primarily targeted at 16-24 year olds. The name Fuse was chosen to communicate the fusion of snacking ingredients. The logo was bright and fiery with a mock fuse - alight in several places - which aimed to give the new bar the quirky and humorous style which Cadbury sought to appeal to this younger target market.
One way of evaluating the effectiveness of advertising and promotional campaigns is to ask market research volunteers to identify advertisements using prompts in a recall test. The Fuse launch had created massive awareness of the new brand, achieving greater prompted awareness than the celebrated Wispa launch. Within just one week of the launch, a record 40 million Fuse bars were sold into the trade and within eight weeks of sale, Cadbury Fuse was the UK's favourite confectionery line, outselling both Mars Bar and Kit Kat by 20% and capturing an astonishing 6.5% of hand-held confectionery product sales. It had also contributed significantly to Cadbury's growth in 1996. The launch had exceeded expectations, with consumers buying 70 million Fuse bars within the first three months of its launch. Cadbury's competitors reacted to the success of Fuse by increasing their own new product activity. Conclusion This case study has examined Cadbury's ability to use innovation in a developed and crowded market-place. There were three clear elements in this process: 1. the use of consumer research to identify a significant market opportunity; 2. product research and development combined with extensive consumer testing; 3. Massive trade and consumer hype generated by a national launch. Snacking remains the big opportunity to expand the chocolate market even further. As Fuse moves through the growth phases of its product life-cycle, the next stage is to move it into the 'super brand' league. As it does so, the key requirement will be to maintain the product's momentum by continuing to develop innovative approaches to marketing it to consumers.
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