Discuss about the Sustainable Marketing Strategies and Industry.
First and foremost, the report will provide Hershey Food Corporation overview before analyzing its marketing mix. The Hershey Company is an American based company and among the world’s largest chocolate manufacturers. Hershey’s portfolio has more than 80 global brands cutting across the candy brands and its well-known chocolate. The company provides chocolate and non-chocolate products to the target market (Berger, 2016, p. 50). Also, Hershey manufactures grocery goods that comprise of cocoa mix, snack nuts, chocolate syrup, bubble gum, cookies, and breath mints. The products manufactured by Hershey are distributed to domestic wholesalers and retailers throughout America and surplus exported overseas. Other main brands of Hershey are Kisses, Almond Joy, Reese’s, Brookside, Cadbury, Jolly Rancher, Good & Plenty of many other products (D’antonio, 2006, p. 4). This report is focused on four companies namely: Barry Callebaut, Cargill, Mondelez, and Hershey that operate in the retail industry. The report will narrow down to of these companies, Hershey marketing mix and compare its SWOT against the three other competitors as highlighted above.
The analysis of Hershey marketing mix will involve a proper investigation of its primary operations aimed at enhancing competitiveness, growth, and market sustainability. The management of Hersey adopt the 4Ps (Product, Price, Place, and Promotion) of marketing in its endeavor to enhance sustainable marketing strategies (David, 2011, p. 22). The report provides a clear elaboration of Hershey pricing, promotional, advertising and distribution strategies that help in broadening the market base as well as its competitiveness in the industry. The below is a clear analysis of Hershey marketing mix:
Hershey is a brand by itself that provides its target customers with chocolates and other sweet syrups and sauces. Hershey offers the market a variety of brands and products that are made available in different sizes and shapes that suit different customers tastes and preferences. The conical shape of Hershey’s kisses together with its hand-rolled packaging of some key products adds to customers appeal (Goi, 2009, p. 2). The management invests a lot in innovation by providing the right technologies that enhance the creativity of new brands with respect to the market demands. This increased and continuous innovation added to Hershey marketing mix has assisted the company in maintaining growth and sustainability over the years. Today, Hershey is strongly positioned in the market as a delicious and healthy product for all growing children. The main products offered by Hershey include:
Being a premium brand, Hershey charges customers higher prices for its products as compared to other standard chocolate brands available in the market. The company targets the upper and middle-class urban market population as well as tourists from foreign countries. The premium prices charged on Hershey brand range from $10 to $5o depending on the size and shape of the product. The management ensures that the prices do not keep on changing even at the times when there are economic downturns and currency fluctuation rates in the market, the prices remain balanced in order to maintain customers’ loyalty (Belz and Schmidt?Riediger, 2010, p. 410). There have not been any price increases or hiking by the company on its products reported recently. However, due to adverse economic conditions, Hershey has lowered product quantity but with the same and even improved quality.
Hershey has a global presence. The company is available in international markets and has opened its grocery stores, wholesale clubs, drug stores, departmental stores, malls, vending machines, gas stations, and hospitals in the global markets. The company has employed over 13,000 employees worldwide where its markets its Hershey products in over 50 different countries around the globe (Kizil et al., 2013, p. 97). Hershey products are manufactures in 17 nations whereby it has 16 manufacturing facilities in which 12 are wholly owned by the company. Hershey has invested in new technologies whereby e-commerce is practiced. The customers of the company are able to buy its products online from eBay, Amazon, Alibaba, and Big basket among many other e-commerce businesses (Gordon, 2012, p. 124). Hersey enjoys quality product distribution from their premises to their target market. Hershey is among the companies that own an excellent distribution network that enable the company to transport its products across the borders and in the global marketplace. All major towns and cities in the countries that Hershey operates are covered by its strong distribution channels.
Hershey promotes its different product brands using various marketing tools. Mainly, product promotion is undertaken through TV Ads, Billboards, social media, and Magazine Ads (Martin and Schouten, 2011, p. 264). The objective of Hershey is creating a delicious and enjoyable chocolate that meets the target market’s tastes and preferences. Hershey milk booster advertisement attempts to position the brand as a healthy good that empowers kids’ growth and acts as a substitute for traditional milk powders (Ottman, 2017. p. 44). The same approach is adopted in Hershey spreads advertisements that show a cute kid playing dumb charades with her mom whose emphasis is showing the benefits of Almond to kids’ growth especially when administered as a daily breakfast (Mintu-Wimsatt and Winston, 2013, p. 10). Traditionally, Hershey has tried to design Ads that showcase spreading happiness that is aligned with its vision of creating Milton Hershey. Further, the company uses “The My Dad Ad” marketing campaign tool to show customers how Hershey chocolate strengthens father-son bond and enhancement of family happiness( Handford et al., 2014, p. 240). Also, the company has established a tourist site in Pennsylvania, known as Hershey chocolate world where families visit and enhance the process of Hershey promotion. There are also various promotional operations like 4D chocolate mystery and trolley tours that inform the target market in the history of chocolate. Further, Hershey uses Facebook, Instagram, and Twitter for social network promotions.
This element will analyze the strengths, weaknesses, opportunities, and threats of Hershey against Barry Callebaut, Cargill, and Mondelez who are its main competitors in the world food market (Moradi, Aghaie, and Hosseini, 2015, p. 500). The SWOT analysis is presented in the table below:
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Strengths i. Strong brand name and image whose awareness both locally and internationally is stronger than that of its competing firms ii. Focus on numerous industry segments such as entertainment, restaurant, resorts, and commercial enables its spread to larger markets when compared to its competitors iii. Hershey offer unique and distinct products to the target market using excellent supply chain and distribution networks that are better than those of the competitors iv. The best product promotional tools that address various market segments as compared to the competitors v. High customer loyalty and retention through TVCs, online marketing and Ads |
Weaknesses i. Reduced market share for its food and chocolate products due to intense competition posed by the three competitors ii. Dilution and lesser authority due to its increased geographic coverage in the world markets iii. The company has more long-term debt than its main competitors and this limits its credit rating iv. High costs associated with advertising through different platforms v. Purchase of Cocoa by Hershey is disorganized and highly criticized than that of competitors |
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Opportunities i. New innovations and more advanced product brands offer the company an opportunity to increase profitability ii. The international/ global expansion offers Hershey an excellent opportunity to raise business sales hence productivity and competitiveness in the industry iii. Improvements in the product distribution network provide the company with a strong opportunity to enhance product diversification iv. Strong customer loyalty give the company faith that new developments will be received and accepted in the market easily v. Excellent communication strategies between the company and its customers and suppliers that result in reliability. |
Threats i. Barry Callebaut, Cargill, and Mondelez offer stiff competition to the company ii. The demand for Hershey’s product has decreased due to increasing health problems such as diabetes and obesity iii. High prices charged on Hersey’s products expose the company to a risk of losing key customers who prefer buying from its competitors who charge lower prices on the same products iv. Constant changes in consumer tastes and preferences as well as increasing economic downturns such as currency exchange rates fluctuations v. Increasing cost of raw materials and lack of government support in the developing countries where technology and education is poor |
Sustainable Marketing Principles used by Hershey
Hershey uses five (5) principles to enhance marketing sustainability of its manufactured products to the target markets. These principles include:
Hershey’s marketing department organizes its promotional and marketing activities from the customer’s point of view (Kasemsap, 2017, p. 440). The company has the passion for delivering superior value products to the target consumers in order to compete out its key competitors in the market.
Hershey has succeeded in its sustainable marketing by directing most of its firm resources towards building customer-value investments. Before making a sale, the company seeks to enlighten the consumer on the value of the product to their life. Enlightened marketing helps the company gain long-term consumer loyalty (Gwaltney-Brant, 2001, p. 44).
Companies continuously aspire to improve their brand quality (Villeneuve, and Pasquier, 2017, p. 6). Today, Hershey has invested a lot in social media and website marketing to increase the number of customers both locally and globally. The company has innovative marketing apps installed on its web to market its products (Askegaard and Bengtsson, 2005, p. 325). Further, Hershey has adopted the use of Facebook, Instagram, and Twitter as social networking tools to increase its sales.
Hershey has defined its ultimate mission in broad social light and terms rather than narrowing the terms and conditions of its products. The marketing mission of Hershey properly serves its brand, employees, and consumers (Khan, 2017, p. 60). Hershey has been socially responsible and as well profitable through its marketing missions.
Hershey’s marketing strategy considers the society, company, and customers interests. The company markets desirable products that offer high immediate satisfaction and high long-run benefits to the society (Klick and Sitkoff, 2008, p. 749). The company creates value for the consumers by using socially, environmentally, and ethically responsible societal marketing that is concerned about the present and future generations of the society.
Hershey has benefited a lot from the use of sustainable marketing strategies as elaborated above. The strategy is useful for food manufacturing companies such as Hershey for it guides the company in maintaining innovative marketing, customer value, sense of mission, and customer focus when designing and promoting the made products in the market (Armstrong et al., 2015, p. 30). Sustainable marketing strategy is useful in helping companies become socially responsible and profitable in its main activities (Abedian and Sharahi, 2009, p. 299). The manner in which employees and consumers are valued by a company is depicted in sustainable marketing strategy. With effective use of this strategy, Hershey does not need to integrate it with other marketing principles since desirable, salutary, pleasing, and non-defective products are marketed to the market using the right promotional tools hence improving corporate responsiveness and productivity of the company (Santos, 2016, p. 12).
Conclusion
Today’s business environment has become very competitive with the number of companies in the same industry increasing. All companies are developing sustainable marketing strategies in order to enhance their competitiveness, growth, and sustainability in the market. Sustainable marketing entails a company focusing on social and environmental investments as its marketing strategy. Most companies are criticized for price markups, waste, and misleading advertising. Sustainable marketing, also green marketing helps these companies counter this negative publicity. Sustainable marketing helps companies build strong consumer relationships. The field of sustainable marketing is rapidly evolving, and this forms an important tool of marketing for businesses. Societal marketing, innovative marketing, consumer-oriented marketing, sense of mission marketing, and customer-value marketing are the common sustainability marketing strategies.
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