Sustainable Management and Marketing Techniques of Hershey

The report discusses sustainable management and marketing techniques of Hershey, a known chocolate brand. The comparison has been laid with other competing brands and there has been SWOT analysis carried out for the same. The SWOT analysis helps to decide the best suitable strategy for the business and the recommendations have been made with respect to the marketing principles.

SUSTAINABLE MANAGEMENT & MARKETING
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Executive Summary
The report discusses sustainable management and marketing techniques of Hershey, a known
chocolate brand. The comparison has been laid with other competing brands and there has been
SWOT analysis carried out for the same. The SWOT analysis helps to decide the best suitable
strategy for the business and the recommendations have been made with respect to the marketing
principles.
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Table of Contents
Executive Summary.........................................................................................................................2
Introduction......................................................................................................................................4
Identify the marketing mix of this organization..............................................................................4
Consider the product, promotion, distribution and pricing strategy of this organisation................7
Using a SWOT analysis, position your chosen organisation against the three other competitors
listed above......................................................................................................................................8
Strengths..................................................................................................................................................8
Weaknesses.............................................................................................................................................9
Opportunities.........................................................................................................................................10
Threats...................................................................................................................................................10
Argue whether this strategy is successful or could be improved by following other principles.. .11
Conclusion.....................................................................................................................................13
Reference.......................................................................................................................................13
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Introduction
The Hershey Company which is listed on the New York stock exchange is also known as
Hershey’s. It is one of the biggest chocolate manufacturers in North America. It has its head
office in Hershey, Pennsylvania, and it is a place termed as home for Hershey's chocolate world
(Hersheypa.com, 2018). It was launched by Milton S. Hershey in 1894 as an affiliate of
Lancaster Caramel business (Hersheypa.com, 2018). It is one of the primitive chocolate
businesses of United States. It has a unique packing and people usually recognise the chocolate
from its outer cover.
Identify the marketing mix of this organization
 Product strategy: it is one of the oldest chocolate companies of United States however it has
many other businesses like Hershey trust company, Hershey Park which is operated by
Hershey entertainment, also has the resorts business, hockey team, chocolate themed
amusement park, a stadium and a GIANT Centre. It is a popular brand offering chocolates
and others sweet syrups and saucers. There are various products available with various sizes
and shapes (Oliver, 2002). There has been a constant product innovation into the marketing
mix which has assisted Hershey to expand in all these years.
 Price strategy: Hershey is a Supreme brand and therefore premium charges are taken in
comparison to different standard chocolates which are there in the market. The focus is on
the upper middle class urban popular and foreign Travellers. The variation of prices is
from $10 to $50 (Hersheysstore.com, 2018). Even though there has been no increase in
pricing in the recent past, yet the demand in different SKUs have been decreased
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 Place strategy: The initial plant of Hershey Pennsylvania started on 15 June 1963 in Ontario,
Canada and the subsequent ones started in 1965 in California. In the year 2007 there was an
announcement made by Hershey that the Canada and California manufacturing units would
shut down in 2008 and these two had to be substituted by a fresh outlet in Mexico. In the year
2002 also there was a manufacturing plant setup in Brazil. There are various factories in
Virginia, Pennsylvania, Robinson Illinois, Mexico Tennessee and various other places
(Hersheysstore.com, 2018).
Hershey is available all over the world in grocery stores, drug outlets, wholesale club,
supermarts, vending machines, malls, departmental stores, hospitals and various other places
where chocolates are available. It can also be bought from different websites like Big Basket,
eBay, Amazon etc (Cadbury, 2011). Hershey has a great distribution Network and therefore
it has the capability to reach different nations all over the globe. The distribution channels of
the business cover almost every major City.
 Promotion strategy: For promotion, the business does not get involved into direct marketing
where direct sales promotion is carried out. However there is interactive marketing carried
out for which the business has appointed Arnold for creation of completely integrated
Advertising and Marketing campaigns all over the world. Arnold is recognized for brand
building by various campaigns such as broadcasting, printing, designing, directs promotions
and Public Relations.
There is sales promotion carried out for commercializing various holidays by providing with
popular gifts. Increase in the significance of commercialized non conventional holidays and
conventional holidays help the business to optimize the significance of their unique gift items
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(Hersheys.com, 2018). By offering the gifts through retail chains, Hershey has an opportunity
to expand its sales volumes for unique gift items.
Hershey does its promotion by television advertisements, magazine advertisements,
billboards and even online platforms. The main objective is to make delicious chocolate that
each and every person can enjoy. Hershey's milk booster advertisement has an aim of
positioning itself as a healthy item for children who are in growing age and also as a
substitute to conventional milk powders. The Hershey spreads also follow the comparative
technique in the advertisement where a cute kid is displayed who plays dumb charades with
his mother and the Emphasis is on the consumption of Almonds for helping children grow as
well as its daily consumption in breakfast (Convenience Store News, 2018). This business
had earlier attempted to create advertisements which displayed spreading happiness in the
family. There is a tourist attraction location in Pennsylvania which is owned by this business
and is known as Hershey's chocolate world (Hersheysstore.com, 2018). Children and their
families go to this place for spending great time and during that time there is promotion of
the product carried out. At this place people can come to know how chocolate is made and
they are also provided with free samples along with experience of the state of the art
technology. There are different promotional acts such as trolley tours, 4D chocolate
mysteries etc (Klara and Klara, 2018). The main focus is on the children therefore children
can design their own Candy and can get involved in the chocolate making procedure. The
other ways of promoting the products is use of Twitter, Instagram and other social media
networks. There are recipes provided for cupcakes, cookies, breads and Muffin cakes from a
puddings, Mousse, candies and snacks, pies and tarts, frostings and fillings etc.
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 People strategy: Hershey tries to keep the workers satisfied and happy because it is believed
that the workers can create great chocolates only if they are happy. For this only, in 1906
Hershey's park was created so that its employees can have some free time for themselves
(Corporate, 2018).
 Process strategy: The process of making chocolate, sweet sauces, syrups includes making of
chocolate bars, calorie bars, peppermint Patty, buttercups and many other things which are
distributed in around 60 countries in the world. It has become so popular that almost 18
million units of this product are created daily to fulfil the demands all over the world.
 Physical evidence strategy: Hershey is an American food business and one of the biggest
chocolate manufacturing businesses all over the globe. This brand started in 1894 when
Hershey cocoa was introduced and it was the initial item from the business to be sold to the
general public. Even though the chocolate was something which upper class society
preferred, it was made available at lesser prices so the other parts of the community could
also enjoy it.
Consider the product, promotion, distribution and pricing strategy of this organisation
The business targets upper middle class people or foreigners and lately its prices have not the
risen however the weights have decreased. Since this brand fights for leadership, they also fetch
new excitement to a once stale Candy Market. By the appropriate marketing mix it has improved
its sales and created interest in its new items. The focus has been on the kids and now it is
shifting its focus to grownups and healthy items as well. The key to this business comeback was
the way it targeted on bigger regions of customers (confectionerynews.com, 2018). It introduced
successful new items and loaded people with great advertisements. The brilliant marketing
strategy of Hershey has made it captured the market again. The marketing strategy focuses
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majorly on kids, athletes and students... This product has faced hi competition and therefore it
has forced the business to boost the promotion and advertisement campaigns. Hershey also
partnered with coke and the focus was on items attributes like health benefits, energy providing
bar etc. There has been a unique packing for every design and every size of product. The
business also focuses more on sales promotion particularly in holidays when kids consume more
of chocolates and candies.
The other three are the key competitors of the business and these offer less diabetic goods than
Hershey. This is the drawback for the brand (Fox News, 2018). Therefore with a straw back it is
difficult to compete with all the three brands collectively. These three brands do not change their
prices for geographical causes however for Hershey the price of the goods altar and therefore the
demand of the brand fall. The shifting price of the goods is the key threat which has to be
resolved by the business so that it can complete with other three brands (The Hindu, 2018).
Using a SWOT analysis, position your chosen organization against the three other
competitors listed above.
The swot analysis has been carried out for comparing Hershey with Barry Callebaut, Cargill and
Mondelez. This section explains the strengths, weaknesses, Opportunities and threats of Hershey
with respect to its position in the market.
Strengths Weaknesses
Hershey Other 3 competitors Hershey Other 3 competitors
It was the first business to
start chocolate production
regeneration.
There has been a toll free
number given for the
Others are following its trend
No other business offers such a
unique strategy
More long run debts for Hershey
It has the least share that is around
10% only
Others don’t have long run debts
Share is higher than Hershey
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students and professors
who want to get extra
information regarding the
company and therefore this
kind of assistance makes
this business much
cooperative than the other
three businesses.
Opportunities Threats
Hershey Other 3 competitors Hershey Other 3 competitors
More countries recognize
brand name due to global
exposure.
Other 3 brands still need
recognition
Criticism for inappropriate strategy
to acquire coco
No such criticism
Strengths
The business has set up the Milton Hershey School for orphan boys so that the brand image is
enhanced and social and environment responsibility is given significance (Business Insider,
2018).
 It was the first business to start chocolate production regeneration.
 It has a great brand name and brand image as it has also turned out to be the biggest
manufacturer of Pasta.
 There is diversification of goods such as chocolate.
 There are various industrial segments on which the business focuses like Resorts, restaurants,
entertainment and commercial segment therefore this name is easily known indifferent
market areas.
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 there has been a toll free number given for the students and professors who want to get extra
information regarding the company and therefore this kind of assistance makes this business
much cooperative than the other three businesses.
 Its facilities are planned to involve schools, parks, housing for workers so that the workers
state contended while working with Hershey’s.
Weaknesses
 In comparison to other 3 businesses there are more long run debts for Hershey.
 Since the business is getting into various geographical areas therefore there has to be a lot of
work done towards company control.
 There has been a tremendous amount of increase in advertising cost that is by 46% (Lightner,
2018).
 Within the industry of chocolate confectionery all over the world, the business has the least
share that is around 10% only.
 Since there has been rise in the prices of cocoa beans there for the rise in price of items sold
by Hershey can decrease the consumer purchases to a great extent (HuffPost India, 2018).
Opportunities
 Since the clients have changing preferences and tastes so there are chances of creating more
and more varieties.
 Dark chocolate is served by the business for health benefits.
 There has been involvement into International Cocoa Initiative Foundation for eliminating
child labour laws for African Nations.
 Efficiency can be improved in terms of distribution.
 The business can exploit it communicating power with both the suppliers and the clients.
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 By making environmental friendly goods, Hershey can set up its repute in the society.
 There are new areas to be explored for Cocoa like India. By producing cocoa in different
areas or different nations at lower cost, the ultimate cost of the final product can be reduced
(Adageindia.in, 2018).
 Since there has been a rise in the world by trade therefore many diverse market areas can be
explored by the company (Sherwell, 2018).
 Strong customer loyalty can be exploited by Hershey.
 The key competitors are Mondelez, Barry Callebaut, Cargill, Nestle, Mars and cadburys.
Threats
 Since there has been more concern regarding rising diabetes in people therefore the demand
for the product has decreased.
 The community anticipates greater environmental concerns before the settlement of treatment
facility by Hershey is will lead to higher cost.
 The best price for chocolate raw materials has been rising as per various geographical
locations (Marketrealist.com, 2018).
 There has been inadequate Government support in developing Nations.
 The cost of Manufacturing Technology has increased making the profit margins lower.
 There has been constant increase in prices of sugar and milk.
 There has been constant rise in the minimum wages of workers for upcoming years.
 There are lesser agricultural regions as these regions are you place for setting up factory and
buildings.
 The chocolate ingredients cultivation gets interrupted because of natural disasters
(McGinnes, 2018).
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 Since the business is expanded all over the world therefore rise in fluctuation of exchange
rates also affects the business.
 Since there has been a rise in the living expenditures of workers therefore their demands have
also been rising.
 There has been a criticism from different segments of community with respect to inadequate
Strategies for purchasing coco.
Argue whether this strategy is successful or could be improved by following other
principles.
Even though the above strategy for the business has been useful still there can be a hobby Centre
set up by the business for each and every age of individuals where people can create various
designs of chocolates. This strategy can be very expensive however it will help the business to
enhance its public image. It is also suggested that the factories are set up in areas which are near
to cocoa producing region for reduction of transport cost. Other three businesses have been
producing beverages similarly Hershey can also set up some drink beverages. Again this strategy
can also be expensive however it can be useful and for this the business will have to purchase
various machineries and skilled workers as a part of the strategy Hershey has to maintain its
focus on the worldwide Markets and expand its presence in various parts of the world
(Apprentice, 2018). In the areas where there is limited presence integration into every country's
culture is important.
Suggested sustainable market principles
The business must look forward to offer latest chocolate flavoured coffee items in supermarts
and coffee outlets like Joe Mugs and Starbucks (Philly.com, 2018). Many clients appreciate
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unique tastes and coffee items and prefer to buy from exclusive coffee outlets. Since there is a
big name associated with the brand therefore new segments and new customers can be explored.
There is an opportunity for the business to get along with coffee manufacturing industry and
other food segments.
The business can also bring various kinds of gum items, chocolates so that is can expand its
market share for shop it is also advised that the production capacity of chocolates and candies
can be increased. There have to be new and latest channels of distribution added to the business
so that the sales get enhanced. In order to stay ahead of the competition, the business has to offer
better customer servicing.
Conclusion
The marketing strategy along with the positioning of the business has been discussed in the given
report. It has also critically evaluate it the strategy of the business, which has anyways been
successful, still there have been certain recommendations provided for improvement of the
market share of Hershey.
Since the business is one of the biggest brands of chocolate producers in United States, it has to
apply a robust marketing mix strategy for maintaining and expanding its market share. There are
many other competitors in the market which focus on capturing the major share and therefore
constant efforts have to be made by Hershey to survive and expand. With the global expansion,
the changes in the marketing mix have to be constantly made with respect to changing
environment in which the business operates. This report elaborates the pricing, advertising and
distributing strategies supplied by the business and also provides with the recommendations for
expanding the visibility of the brand.
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Reference
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