Marketing Management: Investment Decision and BCG Matrix Analysis

This report analyzes the investment decision of Cadbury using the BCG matrix and explores the market share and growth potential of its product portfolio. It provides insights for effective investment decisions and strategic planning.

Marketing Management

Executive Summary
Every decision of a business unit may have deeper impact upon the business, investment
decision is one of crucial long term business decision which can make or wreak a business. Thus,
for a business, investment decision depends upon the knowledge of market share and growth
potential of the product, in order to access these information this report is using BCG matrix that
helps a company for analysing companies product portfolio. The main purpose of this report
paper is interpret or analyse companies market share with product market growth. This will
allow a company to take effective investment decision whether to invest or dis-invest or totally
stop the product. A BCG is framework consist of elements such as dog, star, question mark/
problem children and cash cow.

Table of Contents
Executive Summary ........................................................................................................................2
INTRODUCTION...........................................................................................................................1
MAINBODY....................................................................................................................................1
BCG matrix of Cadbury .............................................................................................................1
Marketing Plan of Cadbury.........................................................................................................3
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
Marketing management in an organisation is a discipline of practical function of
management focus on market planning, research, decision about where to invest and promotions
activity to market the product in the contemporary business market. However, product
investment decision is crucial marketing decision made; therefore, this report throw light on long
term investment decision of Cadbury in its product portfolios in accordance to product market
growth and market share (Rana and et.al, 2020). BCG matrix supports Cadbury to make
judgement whether it should continue investing in product or service or step out. Moreover,
BCG matrix helps Cadbury to form long term strategical planning by adhering product portfolio
market growth & market penetration.
MAINBODY
Cadbury, a UK based multinational company with very elaborate product range, dealing
in confectionery industry globally. They were manufacturing different types confectionery
products with most known series Dairy Milk since a long and acquire renowned market place
through out the world. Having diversify product under its brand, Cadbury need to made certain
investment decision regarding its product portfolio investment to put its competitor like Nestle
under its neck. Boston Consulting group , a reputed consulting firm had developed the BCG
matrix model in 1970 that helps a company for analysing companies product portfolio
(Mothersbaugh, Hawkin and Kleiser, 2019). Thus, this BCG matrix will interpret or analyse
companies market share with market growth. This will allow them to fascinate investment
decision whether to invest or dis-invest or totally stop the product. A BCG is framework consist
of elements such as dog, star, question mark/ problem children and cash cow that are compile in
4 different quadrant, where horizontal axis presents market shares and vertical axis shows market
growth.
BCG matrix of Cadbury
Star ( High market shares and hight market growth)
Products which are lying under the star categories enjoys large market share with assured
continuous market growth, these product are market leading product of the Cadbury. From this
point of view, Cadbury should focus on these product as they will require more investment for
their continuous market growth in order to retain their position in competitive market and
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maintain their business lead. Financial audit of Cadbury illustrates that major portion of their
revenue is from chocolate unit, Dairy Milk series is one of the renowned name in this, thus it can
be consider star product for Cadbury, other than this, Bournvita is also star performer for
Cadbury. In recent time, Cadbury have invested a lot on the promotion of these product in order
to make them more attractive to the customer, due to this they will be involve in high capital
investment in order to increase brand awareness (Calzada, 2020). However, they can cause cash
flow problem for the Cadbury as expenditure are exceed over the income but these product also
generate fund for other products also.
Cash Cow: (High market share and low market growth)
Those products which have reached maturity stage in product life cycle falls under the
category of the cash cow. These products offer great financial strength to the organisation. These
are market penetrated products, which had cover large market share in years, but there are
limited scope of the development of these products as they have crease the maturity stage line.
But, these are important product for company as they creates continuous sales revenue.
Cadbury's Bournville and five star in recent years creates better sales outlook for Cadbury,
therefore, Bournville and five star is cow product in context of Cadbury.
Dog (low share and low growth):
There are some products which consumes the organisational resources but fails to
perform as expected and are also falling ROI of the company. The basic reason for their slow
growth mainly due to lack of product development and innovation. Cadbury manufacture a
chewing gum known as Bubble gum, this product introduces into the market with aim of
entering different segment of market rather than chocolate. In a recent market survey review, it is
found that sales of bubble gum is dropped by 2% which means low consumption among the
people (Chernev, 2020). Thus, this shows that bubble gum is fail to be significant in the market.
Besides this, Cadbury's cold beverage are also performing low in terms of sales. These products
would not simply written off from its product portfolio as money is tied upon these products, so
there is need for improvement in strategies for these products.
Question mark /Problem Child ( low share and high growth)
These are products with great potential growth but have low market share, these products
were not a source of financial stability for Cadbury as they consume more money and fails to
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capture share as per expectation. These are introductory product or new product in
market,although many new products are question with high potential growth in the future.
Cadbury's Oreo cookies and Cadbury's Carmel were not performing favourable as they were not
succeed in creating a strong demand in the target market. Because of lower market demand, their
sales are being gradually fallen down (Roy, 2020. Cadbury need to formulate better product
stratgy for question mark product, because if this product perform reinforced finacial
performance, these product are can be star product for Cadbury.
(Source: BCG Matrix for Cadbury, 2019)
Marketing Plan of Cadbury
Marketing plan is a blueprint for the marketing activities of Cadbury for a specified
future period of time. Basically a marketing plan includes following terms-
 Executive Summary
Cadbuary is manufacturing different types confectionery products, but modern customer
are more health conscious. Therefore marketing summary of Cadbury aim to introduce calories
free chocolate in the UAE market. With an immense market share of 70 % chocolate market , the
aim of this marketing plan is to successfully commercialise its brand in UAE marketplace. The
target market segment of calorie free chocolate are gym addict woman who are avoiding
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Illustration 1: BCG Matrix for Cadbury,2019

chocolate due to presence of lots of calories. It has been expected that within 4 years, the product
will cover approximate 25% UAE gym addict woman chocolate market share.
 Mission and Corporate Objectives
Mission statement- Cadbury means quality, the foremost mission of Cadbury to gain
high quality reputation in confectionery industry. Other than this the ultimate mission of
Cadbury to provide seductive and enrich taste to its customers.
Objectives- To provide quality confectionery product that satisfy customer taste and need
by earning market reputation of best confectionery industry in the world.
Corporate objectives- Corporate objective of Cadbury are formed by using SMART
crtieria which are following-
Specific goals- Specific goals are well define and ambiguous,specific goals have more
probability to easily attain. The specific goal of Cadbury is to provide quality product. There
ultimate aim is to introduce calorie free chocolate to gym addict women
Measurable- There must be a criteria to measure the goals. By sales revenue, Cadbury
measures the effectiveness of calorie free chocolate. Cadbury wants to acquire 25% of chocolate
market in UAE.
Achievable- The set goals should be achievable, Cadbury aims to capture chocolate
market of UAE with its calorie free chocolate that gym addict women can consumer without
worring about calories and fat.
Realistic- Goals must be realistic and relevant and inclined with its routine operations. In
promotional activity, Cadbury aim to introduce its calorie free chocolate at gyms and fitness
centre to check its adaptability (Schawel and Billing. 2018).
Timely- Goal must be time bound, the aim of Cadbury to capture 25% chocolate market
of UAE within 4 years.
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 Situation Analysis
SWOT analysis of Cadbury
Strength Weakness
 Cadbury have great production and
distribution channel in compare to its
marketer competitor like Nestle and
Mars.
 Cadbury is powerhouse of brand name
this is because Cadbury has many
strong and market penetrated product in
its product portfolios such as Cadbury
Dairy Milk, Bournvita and five star. Cadbury have good market reputation
and brand equity in confectionery
industry due to its high quality product
segment (Torquati and et.al, 2018).
 Lack in capturing rural regions areas
due to weak distribution process in
rural areas.
 The target population is uncertain as
there are only few ladies going out on
gym.
 Major weakness of Cadbury is product
recall due to many health and custom
issues, these recall product can damage
brand reputation of Cadbury.
Opportunity Threats
 Emerging confectionery market of
UAE.
 Cadbury is introducing its calorie free
product in UAE market which is less
competitive. To develop better infrastructure to built
strong distribution channel in rural
areas.
 Threat of acceptance of new product by
the target segment audience.
 UAE government had imposed sugar
tax, this would increase the price of
other existing product of Cadbury
which would lower down capitalism on
calorie free chocolates
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PESTEL analysis of Cadbury
External
environmental
factors
Political UAE government have healthy trade relationship with UK, this would help
Cadbury to easily commercialise its calorie free product in the UAE market.
However, UAE some times have political cases with its neighbouring gulf
counties, this may imposed extra tariff charges sometimes.
Economy UAE have highest FDI, therefore it is beneficial for Cadbury to enter in UAE
market, moreover unemployment rate in UAE is very low compare to other
countries therefore Cadbury can appoint skills employees easily.
Social Lifestyle of UAE people is very luxurious due to high paid job. This would
create opportunity for Cadbury to introduce high quality product without
comprising with its price
Technology UAE population are tech knowing, therefore in manufacturing Cadbury can
use high tech machineries because they can acquire technical skills
employees easily (Chiu and Lin 2019).
Environmental The environment of UAE is very dry and hot, therefore Cadbury should
capitalise on cooling technology for freezing chocolates. However, Cadbury
also troubling with green house gas emission, therefore Cadbury should
focus on waste management.
Legal Legal regulations about transaction in UAE could hamper organisational
working of Cadbury , other than this Cadbury also need to clear certain steps
in order to get product license from food corporation department of UAE.
Competitors analysis help Cadbury to analyse market competition by using Porter's 5
model
Porter's five factor Status Analysis
Threat of new Weak In context of UAE confectionery market view, there is low risk
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entrant associated of entery of new confectionery product for Cadbury
because Cadbury have scattered its long tail in UAE
confectionery market with acquiring almost 70% market share.
Threat of substitute Very-
weak
Cadbury's calorie free chocolate is just a new and unique
product concept in chocolate market of UAE, none other
competitor try this idea before. So, there are no similar product
are underlying.
Bargaining power
of buyer
Strong Cadbury have immense buying power because it is global large
chocolate produces and distributor in the world. Morover, in
order to avoid chances of customer switching to cheap brands,
Cadbury need to lower its product portfolio price.
Bargaining power
of supplier
Moderate There are more number of supplier of chocolate raw material in
UAE therefore, cadbury have high power than its supplier
because Cadbury buys raw material in bulk and on regular
basis(Visconti, Peñaloza and Toulouse, 2020).
Industry rivalry Weak Cadbury have huge market capital and market share in UAE
that support it to put its various competitors like Nestle and
Mars under its neck.
 Marketing Objectives and Strategy
Marketing objectives-
 To enhance customer satisfaction by providing healthy chocolates that are calories free.
 To capture 25% of chocolates market share of gym addict women.
 To successfully achieve strategical and tactical goals of marketing plan within 4 years.
 To improve customer loyalty in UAE marketplace.
Branding objectives
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Brand image will support to introduces its calorie product in the UAE market because
people would accept new product of trusted brand. So, to build brand equity, Cadbury would
chose personality approach by targeting female users. For achieving branding objective Cadbury
need to formulate positioning strategies for its product by using STP
Market segmentation
Types of segmentation Segmentation criteria Target market
Geographic Country UAE
Density Urban/ Rural
Demographic Age Above 14+
Gender Male/ female, but more
priority to female users.
Behavioural Status First time user
Target market
From above illustration, the target market for Cadbury is UAE country which is in recent
time growing confectionery industry in the world. In confectionery industry, companies are
facing health regarded issues, in order to counter this threat, Cadbury introducing calorie free
chocolates to all form of gender but specially targeting gym addict women who are avoiding
chocolates due to calories
Positioning of Cadbury-
positioning is a marketing strategy to introduce new product in target marketplace.
Cadbury positioning its product in UAE market by targeting health and diet conscious gym
addict ladies. Positioning of Cadbury is based on product based positioning by introducing a
unique product concept in confectionery industry through innovating calorie free chocolates
(Chernev, 2018).
Marketing strategy of Cadbury regards to its 4Ps of marketing mix
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 Product description-
Product marketing mix strategy of Cadbury is offering particular product in limited
market segment of UAE. Currently Cadbury is planning for offering calorie free chocolates to
women. The product to be offered in 40 gm , 110 gm and 250 gm package. Calorie free should
be printed in a form highlight in product design (Park, 2020). Since, company also have large
product portfolio, company further looking for introducing energy drink to same consumer of
calorie free chocolates.
 Pricing strategies
Since, behavioural assessment of Cadbury are first time user and product is introduction
first time in UAE marketplace, Cadbury should focus on market penetration pricing strategy of
the product i.e. offering product in lower price. Moreover, Cadbury can achieve this goal easily
as UAE had employed sugar tax which higher the cost of production but in producing calorie
free chocolates, no sugar is used, therefore Cadbury can focus on market penetration strategy by
offering chocolates in lower price to women.
 Distribution strategies
To market the calorie free chocolates, Cadbury would go for traditional distribution
system by wholesaler retailer and final customer. Cadbury can also sell its chocolates in fitness
centres and gym through a collaborative partnership with local centres. Moreover, Cadbury
would establish different stores in many provision of UAE so that retailer have adequate supply
of chocolates (Deepak and Jeyakumar, 2019). Furthermore, Cadbury can sell its chocolates
directly in departmental and supermarket also.
 Promotional strategies
In introducing new product to new market, Cadbury need to capitalise more money on
promotional activity. Better way to advertise calorie free chocolate by endorsing star athletic
Serena Williams which is idol for many gym addict women due to its strong fitness.
 Financial Budget and Projections
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Activities 2020 2021
Operation activity £ 7500 £ 8000
Financial activity £ 5000 £7000
Investment activity £2000 £4000
Total £14500 £19000
Marketing expense budget – The budget for the implemented plan is approx £ 1200, the
available funds for operating activity by the marketing department is approx £ 7500, the funding
of the project plan is coming from investment activities by Cadbury investors and internal
marketing department.
 First Year Detailed Implementation Plan
In the implementation of the marketing plan there are number of control that are set in
place which are controlled by the marketing head of Cadbury for routine monitoring of the
implemented plan. Marketing head or manager are also responsible to ensure marketing plan is
implemented on a time to grab market opportunity. The roles and responsibility of an individual
should be clear in implementation plan (Hollensen, 2019). There is also need of strategic and
tactical marketing strategies to counter rising issue in implementation of marketing plan.
CONCLUSION
From the dynamics of carried out study it has been found that marketing management is a
practical discipline of marketing department that include functions like marketing research,
competitor analysis and forming marketing plan. BCG tool is most effective tool for many
marketer in order to make product investment decision for wide range product portfolio. The
above study aim to provide significant role of marketing management in contrast to new product
development and commercialisation in target market by forming marketing plan.
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REFERENCES
Books and Journals
Calzada, J.A., 2020. Communication, Marketing Plan, and Strategy. In Comprehensive
Healthcare Simulation: Program & Center Development (pp. 133-140). Springer,
Cham.
Chernev, A., 2018. Strategic marketing management. Cerebellum Press.
Chernev, A., 2020. The marketing plan handbook. Cerebellum Press.
Chiu, C.C. and Lin, K.S., 2019, July. Rule-based BCG matrix for product portfolio analysis.
In International Conference on Software Engineering, Artificial Intelligence,
Networking and Parallel/Distributed Computing (pp. 17-32). Springer, Cham.
Deepak, R. K. A. and Jeyakumar, S., 2019. Marketing management. Educreation Publishing.
Hollensen, S., 2019. Marketing management: A relationship approach. Pearson Education.
Mothersbaugh, D.L., Hawkin, D.I. and Kleiser, S.B., 2019. Consumer behavior: Building
marketing strategy. McGraw-Hill Higher Education.
Park, S., 2020. Marketing management (Vol. 3). Seohee Academy.
Rana, S., and et.al., 2020. Determinants of international marketing strategy for emerging market
multinationals. International Journal of Emerging Markets.
Roy, D., 2020. Formulation of BCG Index (BCGI): An empirical study on Wal-Mart and
Amazon (1999–2018). Journal of Transnational Management. 25(1). pp.30-56.
Schawel, C. and Billing, F., 2018. BCG-Matrix. In Top 100 Management Tools (pp. 41-43).
Springer Gabler, Wiesbaden.
Torquati, B., and et.al., 2018. How can consumer science help firms transform their dog (BCG
Matrix) products into profitable products?. In Case Studies in the Traditional Food
Sector (pp. 255-279). Woodhead Publishing.
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Visconti, L. M., Peñaloza, L. and Toulouse, N. eds., 2020. Marketing management: A cultural
perspective. Routledge.
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