Marketing Management: Bega Cheese Case Study

Marketing Management
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Table of Contents
Introduction................................................................................................................................4
Identification of issue.................................................................................................................5
Summary of the market situation...............................................................................................5
STP analysis...............................................................................................................................7
Segmentation..........................................................................................................................7
Geographic:........................................................................................................................8
Demographic:.....................................................................................................................8
Psychographic:...................................................................................................................8
Behavioural:.......................................................................................................................9
Targeting..............................................................................................................................10
Targeting Strategy............................................................................................................10
Identification of target market:.........................................................................................11
Positioning............................................................................................................................12
Positioning Strategy:........................................................................................................12
Positioning matrix............................................................................................................13
Marketing Objectives...............................................................................................................13
Marketing Strategies: 7Ps of marketing...................................................................................14
Product:................................................................................................................................14
Price:....................................................................................................................................15
Place:....................................................................................................................................15
Promotion:............................................................................................................................16
People:..................................................................................................................................16
Process:................................................................................................................................17
Physical evidence:................................................................................................................17
Marketing tactics......................................................................................................................17
Marketing Schedule.................................................................................................................18
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Budget......................................................................................................................................20
Conclusion................................................................................................................................22
References................................................................................................................................23
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Introduction
This marketing report will give knowledge about the Australian company Bega Cheese,
which is mainly a company which produces cheese at an effective rate and also of premium
quality. This company offers retail cheese as well as the processed cheese also to the
customers. This company alone holds the 15.7% market of the retail cheese in Australia. The
company collects almost of its 40% revenue from the products like cream cheese, powdered
milk, cheese and many other nutritional products. Bega Cheese Limited recently announced
deal of A$460 million with the multinational food company Mondelez International, on 19th
January 2017 (Begacheese, 2019). This is one of the potent cheese companies or the business
groups in Australia which has a great impact on the economy of the country too. The
importance of the marketing tactics behind the success of the company is also described in
this report. This report also presents an overview of the various kind of segmentation and also
recommends to the company follow the demographic segmentation.
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Identification of issue
The issues that Bega Cheese Limited has been experiencing in recent years have been
described below:
 Decrease in revenue growth from 7.4% to 2.5% after the contract expiration with
Coles (Begacheese, 2019).
 The decline of cheese sales by supermarkets, although they form the majority of
cheese sales in Australia compared to online retailing, which is increasing but is
miniscule as compared to sales from supermarkets (Hutchinson, 2016).
 Low nutritional value in the Tasty Cheese product when compared to its competitors.
 As Australia is becoming more health conscious, the low nutritional value does not
attract customers, and they look for other natural alternatives from Woolworths whose
tasty cheese has almost double the nutritional value.
 The Product forecast for the Bega is weaker as it is never the first to produce a new
and innovating product and also lacks in marketing their products when compared to
other competitors.
 The packaging and branding are essential for distinguishing from competitors and
Bega requires a clean and distinct packaging of its cheese.
Summary of the market situation
The main portion of Australia's cheese sales is done through supermarkets, although there are
some contradictions in these statistics based on the source (Mhurchu et al. 2016). It is
estimated that if supermarkets are able to increase their demands, that would greatly benefit
the cheese manufacturers of the country, especially Bega Cheese Limited. However, in the
last few years, market research has indicated a steady decline of cheese sales by the
supermarkets. On the other hand, although online and internet retailing only comprises of a
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minor percentage of cheese sales, it has shown a significant increase in sales value from
2015-2019 (Austrade, 2019). Experts say that excessive use of social media and technology
in recent years is responsible for this increase in sales value of online retailing. Future
estimations from market research indicate that this increasing rate of sales trend would
continue as long as suppliers and retailers are focused on home delivery services which is
convenient for the customers (Lindberg et al., 2017).
Furthermore, market research also shows that the revenue of Bega industry should grow by
3.2% annually although when compared to other competitors and rivals in the cheese industry
the growth of Bega industries can be considered as underperformance. In the financial year of
2016-2017, the shares of Bega have seen a dramatic increase after its agreement with
Fonterra and Mondelez International (Begacheese, 2019). For the last five years, the contract
of Bega with Coles has also resulted in the expansion of Bega; however, since the expiration
of contract in 2016, the cheese range sales have again decreased. Even recent collaboration
with Woolworths in 2016 was unable to stop the dropping sales value which resulted in only
a 2.5% increase in revenue compared to the 7.4% increase the previous year during the
collaboration with Coles (Annualreports, 2019).
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