Cadburry case study
While we’re talking about a few bars of the 30 million we sell every month – we believe that to be a responsible company, consumers need to have complete faith In products. So even If It calls for substantial Investment and change, one must not let the consumers’ confidence erode. ” Brats Purl, Managing Director Catbird India Time Context: October 2003 (Maharajah’s, India) Short Historical Background: In 1824, John Catbird began selling tea, coffee, and drinking chocolate, which he produced himself, at Bull Street in Birmingham, England.
He later moved into the reduction of a variety of cocoa and drinking chocolates, made in a factory in Bridge Street. John Catbird became a partner with his brother Benjamin and the company they formed was called ‘Catbird Brothers of Birmingham’. Catbird started the process in the back room of his shop with cocoa which he hand ground with a mortar and pestle, which has progressed in the company It Is today with the belief that “doing good Is good for business”. Caduceus has three kinds of confectionery, gum, candy and more famously chocolate.
The company now operates In over 60 countries with a workforce of over 50,000 people.
Everyday millions of people enjoy the Caduceus brand. Caduceus has established Itself In all sectors of Its primary market ? chocolate. Statement of the Problem: How will the Catbird gain back its customers after getting involved into reports that live worms were found in its Dairy Milk chocolate bars in Maharajah’s, India? Area of Consideration: (SOOT Analysis) Strengths: Catbird is the largest global confectionery supplier, with 9. 9% of global market share.
High financial strength (Sales turnover 1997, EYE.
4 million and 9. 4%) Strong manufacturing competence, established brand name and leader in innovation. Advantage that It Is totally focused on chocolate, candy, chewing gum, unique understanding of consumer In these segments. Successfully grown through Its calculations strategy. Recent acquisitions, Including Adams, 2003, enabled It to expand into important markets like the US market.
. Weaknesses: The company is dependent on the confectionery and beverage market, whereas other competitors e. G.
Nestle have a more diverse product portfolio, where profits can be used to invest in other areas of the business and R&D.
Other competitors have greater international experience – Catbird has traditionally been strong in Europe. New to the US, possible lack of understanding of the new emerging markets compared to competitors. Opportunities: New markets. Significant opportunities exist to expand Into the emerging markets of China, Russia, India, where populations are growing, consumer wealth is Increasing and demand for confectionery products Is Increasing.
The confectionery market Is characterized by a high degree of merger and calculations activity in recent years. Opportunities exist to Increase share through targeted acquisitions.
Key to survival within the FMC market is increasing efficiency and reducing costs. Catbird Fuel for Growth Ana cost inclemency programs seek to Daring cost savings Day: 1. Moving production to low cost countries, where raw materials and labor is cheaper. 2. Reduce internal costs – supply chain efficiency, global sourcing and procurement, and wise investment in R&D. Innovation is key driver.
To respond to changes in consumer tastes and preferences – healthier snacks with lower calories need to be developed. R&D and product launches have led to sugar-free & center filled chewing gum varieties and Catbird premium indulgence treat. Low-fat, organic and natural confectionery demand appears strong. Threats: Worldwide – there is an increasingly demanding cost environment, particularly for energy, transport, packaging and sugar. Global supply chain in low cost locations.
Competitive pressures from other branded suppliers (national and global).
Aggressive price and promotion activity by competitors – possible price wars in developed markets. Social changes – Rising obesity and consumers obsession with calories counting. Nutrition and healthier lifestyles affecting demand for core Catbird products. Alternative Courses of Action: A focused and intense communications program should be implemented to rebuild reducibility and restore confidence among the key stakeholders.
Conduct a plantation visit for the customer to see how the chocolates were made. Revamped the packaging of the products to minimize the incidence of infestation.
Recommendation: Conducting a plantation visit will let the consumer know how the chocolates were made and how strict the processes are. The downside of it is that it is very costly and time consuming. And also, it will not give the company the assurance that the consumers will patronize the product again. Intense communications program includes telling the consumers that the infestation is not possible at the manufacturing stage.
Doing this may inform the consumers but advertising alone is not enough because it is not for the long-run.
People may forget what the advertisement is all about. Revamping the packaging of the products or simply innovating it by means of making it more airtight and thick will lessen the incidence of infestation. Also, it will give assurance to the consumers that the same thing will happen again. Therefore, I recommend that the company should apply the first and third alternative courses of action which are being focused on intense communications aerogram and revamping the packaging of the products.
These two should be done hand-on-hand because advertising alone without making any step to avoid the occurrence of such thing is not enough because people nowadays are conscious of what’s happening. And making changes without informing the consumer won’t help much because they are not aware of the benefits of the changes. Conclusion: I therefore conclude that to avoid some infestation of worms of chocolate products, a company must pay attention to its packaging. Check if it provides enough security to the product not Just its appearance and style.