Figure 40: Sales of chocolate confectionery, by outlet type, 2003-07
Source: Mintel
Cadburys, Nestle and Mars are the dominator of UK confectionary market. Cadburys have the biggest market shares in the UK chocolate market shown below:
Figure 18: Manufacturers’ value shares in the UK chocolate market (retail sales), 2003-07
Source: Mintel
In regards to Cadburys, the market research data helps to compare information and holds information that cannot be obtained through primary research. It identifies how Cadbury’s new product development Green and Blacks had enabled it to excel in the traditional core milk chocolate as well as in the growing luxury market. Cadburys analyses the responses to changing market trends and take advantage of the move towards dark chocolate and ethical issues.
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Question 2
Cadbury’s executives are concerned that the salmonella contamination has caused consumers to lose trust in its products.
Outline and evaluate a programme of research to identify consumer’s attitudes and opinions of the Cadbury brand.
Market research is a method that collects the data which will make the business more aware of consumer’s attitudes and behaviour towards the products.
‘’Market research is the systematic design, collection, analysis and reporting of data relevant to specific marketing situation facing an organisation.’’
Armstrong & Kotler, p102 (2007)
Market research process has five stages shown below:
Jobber D, p239 (2007)
Market research explains the number of programmes of research that could help Cadburys to identify consumer’s attitudes and opinions of their brand after salmonella contamination. Research plan consists of primary data and secondary data. Primary data is the most useful method for Cadbury. Primary data is based on the information collected for the specific purpose at hand.
Primary research can be categorised into two researches. Quantitative research is based on the use of structured questions where the response option have been options have been predetermined and a large number if a respondent is involved. However Qualitative research is involved with collecting, analysing and interpreting data by observing what people do and say.
In regards to Cadburys case, there is a need for marketing research to find out consumers attitudes and opinions about their brand. This involves with research planning. This stage would offer Cadburys to identify the marketing problem requires information to help its solution. The next process would be to define the problem. This process would help Cadbury’s to identify problem and that would be the contamination of salmonella product. The last process in research planning would be research proposal. The proposal objective for Cadburys would be to find out the consumer’s attitudes and opinions about the products. The research planning has shown how it can offer Cadbury’s to identify the response form consumers.
The exploratory stage consists of several methods but not all the method implies to Cadburys. The main process that helps the company would be Qualitative research. The main forms of qualitative research are focus groups and depth interviews. The qualitative research would help Cadburys to establish consumer’s attitudes and, values, behaviour and beliefs. Qualitative research is more involved with seeking the data about why and how of consumers behaviour. Focus groups are a small group of people brought together and guided by a moderator through an unstructured, spontaneous discussion about topic. This is very useful for Cadburys as it would arrange groups of people to discuss their beliefs, attitudes, motivation, behaviour and overall good knowledge about its salmonella contamination. This can also be useful for planning questionnaire to focus more on what is important to respondent.
Depth interviews would be useful for Cadburys to find out their opinions about its brands. It involves with interviewing of consumers individually for approximately one or two hours. This would gather detailed and wider information about their opinions and beliefs. The focus groups are more like to be used as it has 77% good response and 19% on depth interviews.
Essential differences between qualitative and quantitative research
Source: lecture notes
The next stage would be the main quantitative data collection. This involves with number of process in order to get Cadburys to obtain useful data about their attitudes and opinions. The research design would more likely to be offering Cadburys a range of methods to get good response. The useful process would be survey method. Survey method offers different options to choose its methods from. These are:
Face to face interviews- response would be higher than the telephone methods. This would help Cadbury to get higher response back from their consumers as they will be interviewing face to face. It is cheaper to use.
Questionnaire- most useful techniques for questionnaire would be open-ended questions. The open ended questions are most responsive as it would not take long time to fill the questions. It is also a quick and easy method of obtaining consumer’s opinions and behaviours.
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Question 3
Cadbury’s recognise that the key to success for the future lies in innovating new products, and have decided to produce new product for the gift giving market. You are required to participate in the marketing planning process at the level to develop the marketing mix.
Formulate and evaluate an integrated marketing mix?
The new product that Cadburys decided to produce for their gift giving market is Cadburys chocolate ice cream. The term marketing mix is devised for Cadburys new product to combine the tactics to achieve its aims and objectives by marketing its products.
‘’The marketing mix is the set of controllable, tactical marketing tools that the firm blends to produce the response it wants.’’
Armstrong & Kotler, p52 (2007)
The marketing mix consists of four objectives also known as four P’s. These are product, price, promotion and place. It is crucial for Cadburys to ensure that they are marketing the right product to, the right person at, the right price in and at and the right time. The target consumer for this product is likely to be gift giving market.
http://www.marketingteacher.com/Lessons/lesson_plc.htm
Product
The first marketing mix that needs to be covered would be product. Product identifies, anticipates and satisfies consumer’s needs and wants. The following research is carried out by the consumers:
- Who is the product aimed at?
- What benefit will they expect?
- How do they plan to position the product within the market?
- What differential advantage will the product offer over their competitors?
The Cadburys chocolate ice cream is aimed at consumer’s gift giving market. So the product would be targeted for occasionally uses, consumers buying gift for special occasion or it can also be purchased on regular basis. The benefit that consumers can expect from the product is quality rather than quantity. Cadburys chocolate ice cream would be made with pure perfection which would satisfy consumers like with any of its other product. The competitive advantage for the product would be its brand as it leads to higher and more consistent product quality. Branding would provide consumer information about products and where to find them.
There are three levels of products suggested by Kotler.
http://www.learnmarketing.net/product.htm
Core Product - The most basic level which addresses the question about what is the buyer actually buying? Customers who purchase chocolate ice cream would be buying more then just an ice cream but with more taste and quality.
Actual Product- This would involve with buying core product and turning them into actual product. The chocolate ice cream would come with service features to suit gift giving market, quality, brand name Cadbury for the competitive advantage.
Augmented product- What additional non-tangible benefits can you offer from chocolate ice cream? This new Cadburys chocolate ice cream would be fitted in this section. These are the extra benefits that the product would provide. For instance its brand identity would be a beneficial as it will give consumers the satisfaction of buying the product with out any queries.
The product life cycle strategy is one way of looking at how the marketing mix would link together. The product life cycle has five stages of evolution.
Product development- This is the beginning when Cadburys would find and develop a new product idea. At this stage Cadburys sales figure would be zero and investment costs would be higher as its production costs.
Introduction- This is the stage when Cadburys would actually be introduced into the market. There would be a slow sales growth.
Growth- In this stage, Cadburys new product would become more profitable and competitors with similar products attract the market.
Maturity- This is the stage when sales grow at a decreasing rate and then stabilise.
Decline- In this stage, the sales growth for Cadburys would decline and profits drop.
http://www.marketingteacher.com/Lessons/lesson_plc.htm
Price
This is a crucial element of marketing mix as it would generate profit from the product. This element identifies what the gift giving market consumers would be prepared to pay for Cadburys chocolate ice cream.
Quality
Low High
Low
Price
High
Pricing strategy matrix
This strategy will identify the price premium for Cadburys chocolate ice cream in the market. In order to set up the price, numbers of factors are taken into the account. These are
- fixed costs and variable costs
- target group
- Company’s objectives
- Average costs
There are number of pricing strategy that can help Cadburys to adapt its price for the product.
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Economy pricing- involves setting up low prices with low quality. The costs of marketing are kept low. This would not be advised for Cadburys to adapt this pricing strategy.
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Penetrating pricing- involves setting up the low price for the product to increase its sales growth. Cadburys could take this strategy to generate stability into the market.
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Price skimming- involves setting up higher prices to attract new competitors into the market and then gradually falls due to increased supply. Cadburys could adapt this strategy as they would have a substantial competitive advantage. This would give them a skimming approach to generate most profit and gradually slows it down.
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Premium pricing- involves setting up higher prices as the product would be unique. Cadbury’s could adapt this strategy to approach a substantial competitive advantage.
Cadburys would most likely to use price premium strategy. Cadburys is known for uniqueness and perfection. The target consumers would be gift giving, therefore the audience would be prepared to pay high price as they aware of the reputation of the brand.
Place
This is another useful element of marketing mix as it would identify how Cadburys distribute, channels and intermediary its products. This is process through which goods are moved from the manufacturer/supplier to the consumers. It is important for Cadburys to take an efficient and effective distribution channels to meet its overall marketing objectives. If the demand and supply for the product is not balanced, the profitability would be affected badly. There are two numbers of distribution channels that Cadburys would use. In direct intermediaries use intermediaries through manufacturers, wholesaler and retailer to consumer. However direct intermediaries uses direct distribution of manufacturers to consumers.
Source: http://www.learnmarketing.net
Promotion
The final stage of marketing mix is the promotion that involves with advertising and campaign. This strategy is involved with market communication that has its own promotion mix.
The elements of promotional mix consist of:
The most useful promotion for Cadburys would be advertising including logos, packaging inserts, posters, brochures and booklets, POP displays and TV adverts. TV adverts has been a great success for Cadburys in the recent years. So it would be a good idea to promote Cadbury’s chocolate ice cream on the TV advert that would attracts more consumers.
In evaluation, Cadbury’s new chocolate ice cream would target gift giving target audience. It is crucial to take a good and effective marketing mix tactics in order to get successful response for the product.
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Bibliography
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Armstrong & Kotler (2007) Marketing: an introduction, New Jersey, Pearson Prentice Hall. Ch2, Ch3.
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Jobber D (2007) Principles and Practice of Marketing, Glasgow, McGraw Hill. Ch 2, ch3.
- Mintel Oxygen (2008) Chocolate Confectionery-UK-April 2008, [online]. Available at: http://academic.mintel.com/sinatra/oxygen_academic/my_reports/display/id=227700&anchor=atom/display/id=334446 (Assessed 05.05.08)
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Mintel Oxygen 2008. Chocolate Confectionery-UK-April 2008, [online]. Available at: (Assessed 05.05.08)
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Mintel Oxygen 2008. Chocolate Confectionery – UK- April 2008. [online]. Available at: (Assessed 05.05.08)
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Wood, L. 2007. Business wire. The UK Confectionery Market Has Seen a Slowing Rate of Growth This Year, [online]. 42(374). Lexis-Nexis. Available at: (Assessed 05.05.08)
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Marketing Mix, 2008. [online] Available at: 06.05.08)
