Brand Extension

This report explores the concept of brand extension for Cadbury, including the existing brand and brand values, target market analysis, and the launch of a new product in the savoury products market.

Brand Extension
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Executive Summary
Following report is prepared to understand the existing brand and brand value of the
Cadbury. And, on the basis of this information, a research is undertaken to conceive the idea of
launching a new product by Cadbury.
Cadbury produces a wide array of cocoa confectionery desserts and products in UK.
Kapferer Brand Identity Prism Analysis was undertaken for Cadbury to understand about its
strong core values which revealed its friendly personality which has admirers from all types of
people irrespective of their age group. This has helped Cadbury set their target market as
universal while taking segmentation, targetting and positioning approach to position itself as a
brand that caters to all age group. PESTLE Analysis of Cadbury was undertaken to throw light
over the influences of the external environment over the company.
Cadbury ideates to launch a new product and to decide which growth strategy they shall
undertake, Ansoff Growth Matrix analysis was taken. Out of all, diversification was chosen and
a new product was designed for an altogether new market. It was decided that Cadbury should
launch baked potato chips with the name of “Cadbury Fringes” in the savoury products market.
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Table of Contents
Executive Summary.........................................................................................................................2
Introduction......................................................................................................................................4
Methodology....................................................................................................................................4
Main Body.......................................................................................................................................4
Existing brand and brand values.............................................................................................4
Target Market.........................................................................................................................5
Analysis of the new market....................................................................................................6
Explanation of a new product.................................................................................................7
Conclusion.......................................................................................................................................7
References........................................................................................................................................8
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Introduction
Cadbury is a British multinational confectionery company. Since, 2010 it is wholly
owned subsidiary of Mondelez International (Anwar, 2019). This report is prepared to throw a
brief light on the business environment of the Cadbury. It aims to develop a new proto product
for the cadbury and analyse the key issues that effect its launch, growth and development.
Methodology
Research methodology is the path of systematic designing of research work. New brand
research was undertaken with a view that Cadbury is entering into a new market with a new
product. More of qualitative data was taken then quantitative data. Primarily observational data
was taken in reference to the market size, market share and chances of success in comparison to
potential competitors of the proposed product such as crsips from Walkers, Pringles, Doritos, etc.
This research is of preliminary phase for estimating if such a product from Cadbury will be able
to survive in market or not. In case, cadbury is actually launching the product, it has to go further
extensive qualitative and quantitative research on market and business environment before
launching.
Main Body
Existing brand and brand values
Cadbury is primarily a chocolates and cookies company. It produces chocolate bars,
biscuits, beverages, rolls, cakes and desserts, etc. Its most famous brand of product is dairy milk
and bournville. Branding is the result of the loyalty in the customers. It says that brand is what
people say about the product to unrelated parties. To identify brand identities, Jean-Noel,
Kapferer designed a brand identity prism. It helps businesses build strong business identities
that reflect the core values of the company. Analysis of brand identity prism in reference of
Cadbury is as follows:
Physique – Its reflect physical characteristics and iconography that is associated with the
brand. Cadbury dairy milk is pictured as purple and white in packaging and brown in inside
colour, slim and sleek in physical appearance. This is the picture that has been attached in the
minds of the people.
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Personality – It is the expression of the brand in the tone of its voice, design and
copywriting. Dairy milk is perceived as young and beautiful and therefore, its promotional
strategies are designed as such that it attracts young customers such as kids, teens and youth.
Relationship – It reflects the relationship between the brands and its customers i.e. the
expectations that a customers hopes from the brand. Dairy milk exudes the aura of being a
friendly product and customers seek it as their loyal and caring friend.
Culture – It is defined as the value system on which a brand behaviour is based (Ward
and et.al., 2020). Dairy Milk is a chocolate that appeals the taste of all age and all geographic
locations. It continues to innovate their flavours and taste to attract new customers and retain old
ones.
Reflection – It is that user that gives the brand its image a stereotypical appearance.
Dairy milk appeals to all. Therefore, they now design their ad campaigns so that they can target
people across all age group not just young people.
Self-image – Its the ideal self of the customer that has made product a brand. Since,
personality of dairy milk is young and beautiful, customer having it also feels like child at heart
irrespective of their age.
Target Market
It is that segment of the whole that company targets as the potential customer of its
products. For example, Cadbury mainly produces chocolate confectionery products which has its
target customers in all range irrespective of gender, education and hobbies. It produces both
premium products and economical products so that they can target all types of social class and
people of all ranges of disposable incomes become its customers. To determine their target
markets, companies undergo STP approach. STP stands for segmentation, targeting and
positioning. It is a strategic approach in marketing to prioritise propositions and then create and
deliver personalised marketing mix to engage with different target audience (Schlegelmilch,
2016). STP for Cadbury is as follows:
Segmentation – It is the process of identifying bases for segmentation. For it, important
characteristics of each market segment is determined such as demographic or behavioural
segmentation. For example, Cadbury segments their products on the basis of income group i.e.
bournville is now a premium product and dairy milk shots are economical products.
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Targeting – Once, all potential segments have been identified, marketers evaluate
potential and commercial attractiveness of each segment. One the basis of their results, one or
more segment is selected as priority. Cadbury has a mass targetting. Their products are such that
they do not want to leave anyone behind as potential customers.
Positioning – At this stage, marketers develop detailed product positioning for all the
selected segments i.e. how the product can be positioned in the selected segment (Gambetti and
Schultz, 2015). A marketing mix is then developed for each selected segment. For example,
Cadbury products have the feeling of association with all age groups. Therefore it promotes its
products to be consumed in both happy and sad moments. Iconic taglines of Cadbury are also
positioned in relation such as “Free the joy”, “Tastes like this feels”, etc.
Analysis of the new market
Cadbury has tried to be present in all the market segments a confectionery company can
be. Following is the PESTLE analysis of Cadbury to throw a light onto the factors affecting it
from its external business environment (Viney, Baines and Stegen, 2016):
Political – Governmental policies like taxes, strict hiring policies of labour from abroad ,
etc. affects Cadbury's operations.
Economical – Various economic factors such as inflation rate, unemployment, business
cycle, etc. have an impact over cadbury sales.
Social – Its promotion of being a sweet and social products has led to its growth and
development in manifolds.
Technological – It improves it packaging process and manufacturing process constantly
with the help of technological advancements.
Legal – Legal requirements such as declaring calorie content sometimes create a problem
in its sales promotion among fitness lovers.
Environmental – Carbon footprint produced by Cadbury as well as plastic packaging used
by it has raised environmental concerns. These are to be addressed by Cadbury.
Ansoff Growth Matrix is a tool that organisations use to decide their market growth
strategy (Hague, 2019). Matrix analysis of Cadbury is as follows:
Market penetration – It is the strategy of growing sales of existing products in existing
markets. Strategy related to dairy milk, shots, etc. come under it.
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Market development - It is the strategy of developing existing products into new markets.
For example, if cadbury introduces its dairy milk to far off place where it was not in direct reach
earlier.
Product development – It is the strategy of introducing new products in existing market.
For example, Cadbury brought out a new flavour of dairy milk in the London market.
Diversification – This is the strategy of developing new product into a new market. For
example, cadbury enters into savoury market with baked potato chips. Its a new product in new
market.
Explanation of a new product
Cadbury has been in sweets confectionery market for so long and has now decided to
enter into savoury market. It has decided to produce baked potato chips. As per the Brand
Extension Options by Edward M. Tauber, a company shall design its marketing strategy for
developing a new product using its already established brand image. The new product is called
spin-off. Cadbury has decided to name its new product as “Cadbury Fringes”. It will come into
three flavours initially – tomato salsa, cheesy cream and barbecue. Product packaging will be
attractive according to the flavours and will be declaring its health benefits along with
ingredients. Brand shall be targeting both kids and adults special mention to those who loves
potato chips and avoid fried ones for health reasons. Marketing strategies shall be designed
accordingly.
Conclusion
Cadbury is a confectionery company which has it mass appeal irrespective of age,
gender, lifestyles and income-group. It has so many products in market but its most famous is
dairy milk. Company knows its strengths very well and design its marketing policies for both
exiting products and new products accordingly.
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References
Books and Journal
Anwar, S.T., 2019. Kraft's acquisition of Cadbury: Was it an amicable transatlantic merger or a
hostile takeover?. Thunderbird International Business Review. 61(2). pp.439-451.
Gambetti, R.C. and Schultz, D.E., 2015. Reshaping the boundaries of marketing communication
to bond with consumers.
Hague, P., 2019. The Business Models Handbook: Templates, Theory and Case Studies. Kogan
Page Publishers.
Schlegelmilch, B.B., 2016. Segmenting targeting and positioning in global markets. In Global
marketing strategy (pp. 63-82). Springer, Cham.
Viney, H., Baines, P. and Stegen, L., 2016. Public Affairs and Marketing. The SAGE Handbook
of International Corporate and Public Affairs, p.115.
Ward, E. and et.al., 2020. Building a unique brand identity: measuring the relative ownership
potential of brand identity element types. Journal of Brand Management, pp.1-15.
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