The Market Positioning of the Chocolate Brands - Essay Example

? Brand Positioning Contents Brand selection 3 Selection of characteristics 4 Group selection justification 4 Data collection procedure 5 Positioningmap 5 Detailed discussion on Positioning Map 6 Comparison of the brands 8 Copy of the rating scales and raw data table 9 Reference 9 10 Brand selection The objective of this project is to examine how marketers determine consumer perceptions of their product relative to competitors’ products. The product category chosen for the project are chocolates. The chocolate industry is at a growth stage and is expected to increase in the future. The global chocolate market is expected to grow by CAGR 2.7% from $83.2billion in 2010 to $98.3billion in the year 2016. The Asian chocolate market is the driving sale and likely to hold about 20% of the market share of the global chocolate market in 2016 and sales of chocolate in the Asian market is likely to boost up share from $15billion to $19.7billion in 2016. US leads the chocolate market with a market share of 86.3% in North America, Japan has a market share of 39.7%, Europe with a market share of 16.4% and Germany accounts for 15.9% (Markets and Markets,” Markets and Markets: Global Chocolate Market worth $ 98.3 billion by 2016”). Five major brands chosen for the project in the chocolate industry includes Cadbury/Kraft, Mars, Nestle, Ferrero and Hershey. Cadbury/Kraft food generated total sales of $19,965 in 2011 and accounts for 15% of the market share in global chocolate industry; Mars generates sales of $16,200 and has a market share of 15% in 2011; Nestle sales stood at $12,808 with a marker share of 13%; Ferrero Group accounted for $9612 and market share of 7% and finally Hershey foods generated sales of $6112 with market share of 7% (ICCO, “The Chocolate Industry”). Selection of characteristics Brand positioning is based on certain characteristic depending on the product or the brands. The product chosen is chocolate and therefore four major characteristics of the product chosen are quality, taste, price and image of the brand. Quality forms an integral part and chocolate and quality goes hand in hand. In the chocolate industry ingredients like cocoa, cocoa butter, sugar, fats, flavorings and emulsifier plays an essential role in the quality of the product. Quality of chocolate is dependent on the quality of raw materials (Chocolate Source, “What Makes a Good Quality Chocolate?”). Taste is another important factor in the positioning of the brand. Consumers tend to consume chocolate for taste. Dark chocolates are consumed only for its taste and all the brands take effective measure in order to produce and manufacture chocolates with good taste. Price although is not that important when it comes to brand and brand name but cannot be ruled out completely. The top chocolate brands prices their products almost at par which implies stiff competition in the chocolate industry. Therefore the four characteristic will help to determine the positioning of each of the brands in the chocolate industry. Group selection justification In order to analyze the positioning of the chocolate brands two set of groups are taken into considerations, the female consumers and the male consumers. The sample size of male and female consumers taken into consideration is above the age group of 18 years. The female consumers group usually loves chocolates and loves to consumer variety of chocolates. The other set which are the male group will help to determine the reason behind the consumption of chocolate and the most preferred brand by the consumers. The female group of consumers will help to provide feedback regarding innovation, packaging, taste and other added feature required by a brand. Both the groups play an essential role in developing the brand name and image of the product and are core of any product. The males are taken into consideration to overrule the existing believe that chocolates are consumed and loved by females to a very high extend. The male segment of the society also prefers chocolate and to determine this males are considered as a set of two groups. The two set of group will together help to gather preview of different brands, the most preferred brand, the important characteristic which is important according to the consumers and overall the chocolate industry, indicating the future of the industry. Data collection procedure Data for the analysis is collected by means of questionnaire prepared for the two groups, male consumers and female consumers. Two set of questionnaire will be prepared for each group to determine the desire and preferred brand of the each group, the reason behind purchasing the particular brand. The data will be analyzed from the questionnaire prepared through www.surveymonkey.com and are further analyzed the brands with respect to females and males. The questions mostly are based on likert scale ranging from 1 to 5 where 5 means strongly agree and 1 being strongly disagree. Likert sale is one of the most important tools used in the collection of data. The questionnaire designed takes into consideration a sample size of 20 consumers and are mainly quantitative in nature. Positioning map The positioning map drawn has taken two important features, price and quality. The X axis constitutes of price and the Y axis constitute of Quality. Price and quality are seen as the most important factor in the chocolate industry. Quality and price determines the brand and creates value for the product. The positioning map shows the five brands on two basis, price and quality. It will help the marketers to reposition its marketing strategy when required and create a bigger brand name with better quality and price. Today consumers are not concerned about the price any more they categories it as a luxury or premium product and sees it as a status symbol. High Quality Low Price High Price Low Quality Detailed discussion on Positioning Map The above perpetual map shows the positioning of each of the five brands based on price and quality, two important and essential factors. Ferrero is regarded as the top most quality chocolate product and also the highest priced brand. Ferrero is the favorite chocolate for millions of people and is the world leader in its category. Ferrero most famous product is the Ferrero Rocher. The quality of the chocolate is high and is manufactured with great attention along with refined packaging. The most important factor is its innovative shape making it attractive to the target group. The prices charged are also high for the brand making it the highest price maker in the chocolate industry. As per ebay Ferrero Rocher of 3 kilos would cost $135, a set of 48 would cost $18.14. The second brand in line is Mars with high quality and high price. The brand is competing with Ferrero to reach the top slot. Although the market share of Ferrero is comparatively less than Mars. All the brands are said to be high in quality, the only difference is its price. Cadbury which has a market share of 15% similar to that of Mars (15%), applies a different pricing strategy. Cadbury is positioned as high quality but with moderate pricing the products of Cadbury are not priced high and are easily affordable by the target group. Cadbury do not charge the lowest price but a decent one targeting all level of consumers. Hersey and Nestle also manufactures high quality of product but their prices are less than Mars and Ferrero. Thus they are placed on the left side of the positioning map depicting high quality of products but low price. It is seen that either of the brands Mars, Ferrero, Nestle, Cadbury and Hersey does not manufacture low quality of product. Although some of the chocolate brands prices are comparatively low but the quality remains to be high and thus chocolate are preferred by all age group irrespective of any time, occasion and festive seasons. Comparison of the brands The top five brands in the chocolate industry taken into consideration for analyzing the positioning of each of the brands are Cadbury which comprises of 15% of the market share in the global chocolate market followed by Mars which also has 15% market share in the global market. Both the brand manufactures chocolate of high quality but differs in pricing strategy. Mars is shown as high quality chocolate with high price whereas Cadbury manufactures chocolate of high quality but the price charged are not high. Also in the recent past Cadbury had to face charges against quality issues in its products. Cadbury, Mars are among the famous and top brands globally in the chocolate industry and with its innovative and different packaging style has been attracting the two groups of consumers. Nestle ranks third in terms of market share with about 13% of the total global share. Nestle also manufactures high quality of chocolate and follows the pricing strategy of Cadbury. The products of Nestle are charged comparatively less than any other brands. Nestle is an MNC headquarters in Switzerland and has targeted all the sections of consumers. Next in row is the brand Ferrero and it has been able to capture a market share of 7% globally. Ferrero Rocher is one of the most famous brands of the company and manufactures the highest quality of product and it tops the list with its high quality product and also is priced high. In the positioning map, Ferrero is shown at the left side of the map stating high quality along with high price. The brand manufactures various other products apart from chocolates. Ferrero and Hershey has an equal share in the market with 7% each but to compare both the brands it can be said that Ferrero has been able to generate brand awareness and has offered famous products like Ferrero Rocher. Hershey is a new company established in 2005 and is among the largest chocolate manufacturer in North America. Hershey is at par with Ferrero and is equally famous and are desired by all the target customers both male and females. Hershey also manufactures high quality chocolates and the price charged are also high similar to Ferrero and Mars. Copy of the rating scales and raw data table Rating scale that would be used in the questionnaire is as follows, Rating scale in between 1to 5, where 5 means strongly agree and 1 refers to strongly disagree. 1: Strongly disagree 2: Disagree 3: Neither agrees nor disagrees 4: Agree 5: Strongly Agree Likert scale is one of the popular scaling methods and is undertaken to make the respondent specifies certain level of agreement as well as disagreement with the given statements to express a favorable or unfavorable attitude towards the survey. Reference Chocolate Source. “What Makes a Good Quality Chocolate?” Chocolate Source, 2008. Web, 8 November 2012 < http://www.chocolate-source.co.uk/quality_of_chocolate.htm> ICCO. “The Chocolate Industry.” International Cocoa Organization, 2012. Web. 8 November 2012 Markets and Markets. “MarketsandMarkets: Global Chocolate Market worth $ 98.3 billion by 2016”. Markets and Markets, 2011. Web. 8 November 2012 < http://www.marketsandmarkets.com/PressReleases/global-chocolate-market.asp > Read More