Canadian Chocolate Bar Market Essay Example for Free

Canadian Chocolate Bar Market Essay •Increase in cost for manufacturing such as packaging or ingredients. Chocolate bars are thought of as impulse buys, which means they require no thought. This is due to how inexpensive they are. However, if an ingredient such as sugar was to rise drastically, so will the cost of the chocolate bar therefore changing the buyers perspective on the product class. Social, Demographic Trends: •Although chocolate bars are thought to have been more enjoyed by a younger consumer, crispy crunch has always focused towards older demographics. This is shown through their mature packaging commercials. Healthier Living: •Consumers are now watching what they eat, and want to avoid products that contain ingredients that have become deemed as fattening. Technology: •Internet advertising is at an all time high, and consumers are attracted to products that they can get more information on over the Internet. Also, buzz promotion can be created efficiently via Internet. Political: •French/English Packaging •In Canada it is illegal not to have both English and French writing on the packaging. Ingredients: •All ingredients must be labeled on the packaging. Market Analysis Total Canadian Size and growth: •From 1996 to 2000, the chocolate market enjoyed a total growth rate of 19.1% with retail sales in 2000 producing a whopping $13.7 billion. Competitive Analysis Market Trends: •Hershey Canada is one the largest competitors in the chocolate bar market. Hershey brands have a strong market value and a long history dating back to 1903. Hershey Canada owned three of the top five chocolate bars sold in 2000 to 2001. Hersheys three principle brands held fifteen percent of the Canadian market share. Hersheys brands, Reese Brand, and Hershey Milk Chocolate gained 0.9 percent market share in 2000-2001. Hershey brand Oh Henry lost 0.3 percent market share but still holds the number four spot in market share value. Hershey Canada has strong brand recognition, and loyalty. •Nestle Canadas three principle brands, Kit Kat, Coffee Crisp, and Smarties represented 13.4 percent of the Canadian market in 2000-2001. Nestle has a considerable market share and strong brand insistence however only one brand gained market value. Kit Kat, Nestle principal brand gained four points surpassing Cadburys Caramilk. Kit Kat now represents the second largest piece of the market at 5.4 percent. Coffee Crisp was stalemate at 4.2 percent of market share. Nestle Smarties lost 0.3 percent of market value now ranked ninth out of the top ten chocolate bars in the Canadian market, leaving only Effems Mars behind it. •Effem Foods has two brands ranked in the top ten chocolate bars in the Canadian market, Mars and MMs. Effems two principle brands represents 8.2 percent market share. Effems Mars and MMs both lost an accumulated 0.9 percent of market share in 2000-2001. Market Analysis: •Hershey Canada, Reese Brand, represented 6.3 percent of the Canadian chocolate bar market share in 2001. Reese brand targeted young children the ads have a youthful orientation and show kids having fun eating the bar(Crunch, Crispy Case). Reese Brand was creating strong brand insistence by penetrating younger consumers. Reese used point-of-purchase materials to attract the impulse consumer. Reese also employed the leadership positioning strategy; Reese showed their product as a preferred choice among children. Hershey Milk Chocolate and Oh Henry both have a strong brand loyalty due to their insistent customer base that had been developed over years. •Nestle Canada, was a leader in the Canadian Chocolate bar market due to strong market penetration and position on the market. Nestle Smarties used the image positioning strategy. Nestle used image positioning to differentiate Smarties from Effems MMs. Nestle claimed to have a larger assortment of colours. Smarties used humour appeal to attract customers to save the red Smarties until last. Kit Kat was Nestles leader in market share representing 5.4 percent. Kit Kats target market was early twenties to late thirties. Kit Kat applied the lifestyle position strategy on the market. Give me a break of that Kit Kat Bar this slogan was used by Nestle to imply that a Kit Kat bar would be the best chocolate bar to enjoy while on a break. •Effen Foods brands Mars, and MMs both had a large market share and strong Brand loyalty in 2000-2001. MMs used Head-on positioning to penetrate and differentiate themselves from the market. They melt in your mouth, not in your hand that slogan was a direct blow to Smarties. Effen is implying that the quality of their product is better than the competitors. Target Market Analysis Demographic profile: •Age: 15-24 Gender: males, females Education: High school, College, University Occupation: Part-time, or new career opportunity Household: either living with parents, or living with a spouse Geographic profile: •Urban location of customers, allowing the customers to more easily access the product. •Packaged in English and French writing. Psychographic profile: •Activities: Going out with friends, girlfriends. Playing sports, videogames, watching movies. •Interests: Doing well in school, finding job/career opportunities for future, having fun enjoying time with friends/family. •Opinions: Would like a clean, safe environment. Consumer behavior profile: •Personality: Ideal Self Consumers as they see how they would like to be. It is what they aspire to. •Attitudes: More liberal minded consumers, show more of a selective exposure. Product Analysis Sales Volume Trends: •Between 1989 and 1990, it jumped seven places to become the number one brand in the nation. •More recently however, the Crispy Crunch Brand has fallen off the top ten chocolate bar brands to 12th place. Market Share Trends: •Old established brands continue to lead the pack in popularity; brands like Kit Kat, Oh Henry, Coffee Crisp and Smarties all date back to the 1950s and 1960s. •Reese Brand holds 6.3% of the market share, up from a year ago Current Channels of Distribution: •All the leading brands are available in the same locations: •Convenience stores •Drug stores •Grocery outlets •Vending machines •Discount stores •Marketing Communications (Historic) •The success from the early 90s was attributed to an advertising campaign •Targeted a slightly older audience of older teenagers and young adults in their early twenties rather then youth under the age of 16. •The strategy worked very well and there were several ads in the campaign. S.W.O.T Analysis Brand Strengths: (Internal) •Crispy Crunch contains a combination of chocolate and peanut brittle that offers a unique taste to consumers that other chocolate bars do not offer. Also with the image of being to good to share Crispy Crunch still has the potential to make its mark into top 10 Canadian brands by pushing the product into more advertising to make consumers more aware of its presence in the market. Weaknesses: (Internal) •Although Crispy Crunch has had a successful campaign for a period of time, other brands that Cadbury have released like Caramilk have been a little more dominant in the market. It is possible that maybe Cadbury did not pay enough attention toward the Crispy Crunch campaign, which may result in the reason for its fall behind in the overall market. Opportunities: (External). •Cadbury can use many forms of advertising their product these days as long as the presentation is executed properly. For instance, the Crispy Crunch brand has been known to add sexual situations in order to promote their product towards 15-25 year old people. If the campaign goes about with the same image or chooses to take a diverse approach to the market to recreate the image of the brand, window is still open for opportunity which either choice. Threats: (External). •Cadbury must be able to create or revise a marketing mix that would keep a strong stand in the market against the big competition from Nestle and Hershey who both have very successful campaigns for their chocolate products. Positioning Statement. • A Crispy Crunch Bar contains the grouping of chocolate and peanut brittle that offers distinctive and delectable flavor. Eat your Crisply crunch bar before somebody eats it for you! the only thing that tastes better than my Crispy Crunch, is someone elses Crispy Crunch. Target Market Definition. •Males and females 15-24 years old, who are currently working and make time for going out with friends and family. They are infrequent users because they are health conscious and may be into another brand.