Strategic Analysis of Hershey's: Marketing Mix and SWOT Analysis

This report assesses Hershey's marketing strategies, focusing on the marketing mix (product, price, place, promotion) and a SWOT analysis to identify strengths, weaknesses, opportunities, and threats. It explores Hershey's sustainable marketing practices, including micro-marketing, seasonal marketing, and co-creation strategies, highlighting their effectiveness in maintaining a competitive edge. The report concludes with recommended sustainable strategies for Hershey's to enhance its market position and ensure long-term growth. Desklib offers a wide array of solved assignments and past papers for students seeking comprehensive study resources.

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Executive summary
The report is aimed at identifying the changes that are required to be taken by Hershey’s to
determine the sustenance in the functions taken by the same as per the needs of the customers.
The report examines the potentials of the organization through a SWOT analysis and the
marketing mix of the business. The main purpose of the report is to delineate recommended steps
for the organization to bring in sustenance in its actions while expanding its business in the
markets.

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Table of Contents
1. Introduction..................................................................................................................................3
2. Marketing mix of Hershey’s........................................................................................................4
Product.........................................................................................................................................4
Price.............................................................................................................................................4
Place.............................................................................................................................................5
Promotion....................................................................................................................................5
3. SWOT of Hershey’s....................................................................................................................6
4. Sustainable marketing practices by Hershey’s............................................................................8
Micro marketing..........................................................................................................................8
Seasonal marketing......................................................................................................................8
Co-creation strategy.....................................................................................................................9
5. Sustainable strategies as recommendations.................................................................................9
6. Conclusion.................................................................................................................................10
References......................................................................................................................................11

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1. Introduction
The current business scenario demands sustainable business and marketing practices from
the contemporary business organizations. This is due to the reason that competition is much
higher in the current market scenario and it is important for the business organizations to have
innovative and sustainable marketing practices (Shamma and Hassan 2013). The more
innovative and sustainable marketing activities will be initiated by the business organizations,
the more will be the probability of gaining competitive advantages in the market. However, it
should also be considered that all the factors in the business operation should be determined
effectively prior to the initiation of the marketing activities.
Hershey’s is one of the major confectionary brands in the world based in the United
States. They are having their market presence in more than 60 countries and are considered as
one of the largest chocolate manufactures in the world. However, they operate in highly
competitive market comprising of some other global brands along with number of local brand in
different countries. Thus, they are also having the need of sustainable marketing practices in
order to enhance their business potentiality in the global market along with maintaining the
market position against the competition.
This report will discuss about the marketing mix strategy of Hershey’s in order to identify
their major elements of marketing. In addition, the SWOT analysis will be performed to identify
the positive and negative factors of Hershey’s. The sustainable business practices of Hershey’s
will also be discussed and analyzed and recommendations will also be provided.

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2. Marketing mix of Hershey’s
Product
One of the major advantages for Hershey’s in terms of their product strategy is having
diverse product portfolio. Currently they are having large variety of candy and chocolate ranging
across different price ranges and in different shapes and sizes. According to the reports, the
product portfolio of Hershey’s includes chocolate, candy, mint, gum and caramel. Moreover,
there are different variants available for each of the products along with having different sizes.
Thus, the product assortment for Hershey’s is huge and it is helping them in targeting large and
diverse customer segments (Stark 2015). Another advantage of the product strategy of Hershey’s
is that they are being able to cater to different need in different market with their diverse product
portfolio. For instance, the demand for chocolates is different in the United States and Australia.
With having diverse portfolio, they can effectively cater to the different market requirements.
Price
In comparison to the rival brands, Hershey’s is having more premiums pricing in the
market. One of the major reasons behind the initiation of the premium pricing by them is that
majority of the products of Hershey’s is legacy and premium pricing justifies the legacy of their
products (Keller 2017). Moreover, initiation of the premium pricing also helps them to cut off
the intensity of the competition. This is due to the reason that majority of the rivals of Hershey’s
is operating the mass market and thus charging higher price helps Hershey’s to have a
completely separate market space (Davcik and Sharma 2015). Another advantage that is being
gained by Hershey’s from the initiation of the premium pricing is increase in profitability. Thus,
the average profitability of Hershey’s as compared to the rivals firms is more.

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However, it is also to be noted that initiation of the premium pricing will also limiting the
market reach and share of Hershey’s. This is due to the reason that major section of the mass
market is not getting catered with having higher price point. In the global market also, premium
pricing is the reason for having market share in the developing countries for Hershey’s.
Place
Distribution and retailing of the products of Hershey’s are the major area of gaining
competitiveness in the market. This is due to the reason that products of Hershey’s are available
in each and every grocery store in their operating markets (Belu and Marinoiu 2014). Apart from
the grocery stores, the products of Hershey’s are also available in shopping malls and different
departmental stores as well as through vending machines. They are also available in the online
forums also such as Amazon and eBay. Thus, the market presence of the products of Hershey’s
is extensive and is targeted in reaching out to maximum number of potential customers.
Promotion
Extensive promotional policies and activities are being followed by Hershey’s in
reaching to maximum number of customers. Offline promotional mediums for Hershey’s include
television commercials, billboards and magazine advertisements (Arapi 2014). However, one of
the major points that is being followed across all promotional activities and advertisements of
Hershey’s is relating happiness with their products. The major objective of their promotional
activities is to communicate that happiness can be generated from using their products.
Moreover, concept of happiness is more relatable with the chocolates and candies. Social media
marketing is also being promoted by Hershey’s including facebook and instagram. These help
them to promote relationship marketing with the customers (Ashley and Tuten 2015).

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3. SWOT of Hershey’s
Strengths
 Wide distribution
 Innovative chocolate brand
 Huge product portfolio
 Brand equity
 Philanthropic efforts
Weaknesses
 Purchase of cocoa
 Limited scope of expansion
 New entrants in the market
 Duplicity of its products
Opportunities
 Expansion in the snacks segmentation
 Powerful distributive networks
Threats
 High competition in the market
 Decreasing margins
 Health awareness
 Poor supply of raw materials
The SWOT analysis of the organization, Hershey’s has helped in identifying the different
aspects of the possible opportunities and threats that are faced by the business while undertaking
the activities as per the needs of the market (Besharov and Smith 2014). On the other hand, the
identification of the strengths and the weaknesses of the business help in the proper management
of the business functions (Alexander 2013). The wide distribution channels of the business
have helped in determining the changes in the structure of its functioning as per the identification
of the tastes of the segmented customers. It has helped the business in maintaining the loyalty of
the customers, which resulted to a sustainable brand equity in the industry. The initiative of
innovation that is undertaken by the business is dependent on the variable choice of the small

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segments of the customers, which has helped the business in maintaining a good brand equity
(Goetsch and Davis 2014).
On the other hand, the company faces a challenge while making a purchase of the chief
raw material, cocoa, which has affected the productivity of the business as per the needs of its
expansion in the international markets (Bolman and Deal 2017). The low availability of cocoa
affects the functioning of the business to suffice to the demand of the customers in the market,
which affects the proper functioning of the business. The limited scope of expansion of the
business is characterized by the micro marketing undertaken by the same (Hislop 2013). It has
helped the organization in enhancing the loyalty of the customers while compromising the scope
for the business expansion in the market. Barry Callebut, Cargill and Mondelez the chief
competitors of the organization, belonging to the same industry, have acquired a greater position
in the market through the expansion undertaken by them in their businesses. The limited scope of
expansion has given rise to the acquisition of the market by the new entrants, which has affected
the functioning, and the scopes of the business to maximize the market share.
SWOT of the business has also helped in delineating the opportunities of the organization
in bringing forth changes in the systems and the functioning of the business as per the
organizational objectives. The expansion in the snacks segment of the business will be helping
the organization to make an expansion in the market as per the needs of the customers in the
market. The identification of the opportunities of the organization will be helping the business to
design procedures and steps to expand their product portfolio based on the needs of the
customers and the preferences of the same in the respective markets. The identification of the
competitors of the organization will be helping the business to undertake an analysis of the
advantages that are being faced by the businesses (Brooks, Heffner and Henderson 2014). The

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company faces a high competition from Barry Callebut, Cargill and Mondelez and the
functioning of which has affected the brand equity of Hershey’s considerably. The identification
of the factors supporting the competitive advantage of the companies will be helping Hershey’s
to formulate new strategies to cope up with the challenges in the market. on the other hand, the
identification of the costs that are incurred by the company, which has affected the profit
margins will be helping the same in minimizing the different costs. It will be helping the
organization to bring in changes in the systems and the performance of the business in the market
(Kajanus et al. 2012).
4. Sustainable marketing practices by Hershey’s
Micro marketing
They follow the concept of micro marketing, which denotes that Hershey’s is having
smaller target market or segment for their business operation (Layton 2015). According to the
strategy of Hershey’s, they are having smaller target customers and they design their product
portfolio in accordance to the tastes and preference pattern of these smaller segments (Chhabra
2013). Thus, it helps Hershey’s in having higher level of customer loyalty and satisfaction of
their target segment. Though, they are having smaller target segment but their rate of customer
loyalty is more compared to their competitors.
Seasonal marketing
It is another innovative marketing activity practiced by Hershey’s. According to this
strategy, Hershey’s launches special items during different holiday and festive seasons. These
items are being designed in accordance to the mood of the particular festival. It helps Hershey’s
to cater to the market effectively by offering distinctive and customized products to the

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customers (Manthiou 2014). Moreover, the average trend of expenditure of the customers in the
festive season is more compared to other time of the year. Thus, this strategy helps Hershey’s to
meet the increased demand of the customers during the festive season.
Co-creation strategy
Co-creation strategy is one of the most effective and popular marketing strategies
practiced by the business organizations. Hershey’s also have initiated this strategy in order to
enhance the engagement of the customers. Different activities are being initiated in order to
engage the customers in designing the products especially the kids are involved in the co-
creation process. This helps them to have more engaged customers in place along with
effectively determining the trend and requirement of the market (Yi and Gong 2013). This
strategy also helps Hershey’s to launch and promote products in the market in accordance to the
change in taste and preference pattern of the customers (Kuipers et al. 2014).
Thus, it can be concluded that the marketing practices of Hershey’s are sustainable as
well as effective in nature. These practices help them in maintaining their distinctive position in
the market and effectively competing in the intensely competitive market scenario.
5. Sustainable strategies as recommendations
The recommended actions that might be undertaken by the business is based on the
evaluation of the internal and external environments of the same. This section of the report aims
at identifying the recommended actions that might be undertaken by Hershey’s to bring in
sustenance to its functions in a competitive market.

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 Development of the macro marketing- Macro marketing will be helping the
organization to expand its business in the international markets. The expansion of the
business in the international markets will be helping the organization in maximizing the
productivity of the same as per the preferences of the customers. On the other hand, the
macro marketing will also help the organization in acquiring a greater percentile of the
market share, which will act as the competitive advantage for the company.
 Cutting off extra costs that are incurred by the organization- The extra costs like the
operational costs, labor costs and other distribution costs that are incurred by the
organization affects the profit margins. It affects the smooth functioning of the
organization as per the objectives of the same. However, the business can take steps to
implement technological innovations in the systems to curb off the operational costs that
are incurred by the organization. It will be helping the business to bring in sustenance in
its functions. The proper understanding of the costs that are incurred by the organization
can be identified through a detailed study of the balance sheet of the organization. the
company thereby should take steps to bring in changes in the performance of the business
through the implementation of the technological innovations as per the needs of the
customers in the market.
6. Conclusion
Therefore, from the above analysis it can be stated that the proper functioning of the
organization is based on the identification of the different strengths and weaknesses of the
business. The identification of the different factors that creates the urgency in an organization to
bring in changes also helps in the decision making process. The different factors that have
affected the growth of Hershey’s in the market are evident from the report. Sustenance of the

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organization is based on the identification of the different activities that are undertaken by the
organization and the manner in which it helps in bringing in developments of the business in the
market. The continuous innovation that is undertaken by the organization helps in the
maintenance of the sustenance of the same in the market.