Strategic Direction and Change: A Report on Chobani Yoghurt's Strategy

This report offers a strategic analysis of Chobani Yoghurt, a leading Australian dairy company. It examines the company's current market position, future plans, and the strategies it employs to maintain its competitive edge. The report utilizes SWOT and Porter's Five Forces analyses to assess the company's internal and external environments, identifying strengths, weaknesses, opportunities, and threats. It delves into the competitive landscape, including key competitors like Yoplait, and evaluates the bargaining power of consumers and suppliers. The report also explores the company's marketing efforts, brand recognition, and potential for market expansion, including opportunities in the Chinese and Asian Pacific markets. Furthermore, it discusses the challenges and limitations Chobani faces, such as high production costs, government regulations, and competition from new entrants. Finally, the report provides justification for the adopted strategies, emphasizing brand modification, market strategy adjustments, and product diversification to cater to a broader consumer base.

Running head: STRATEGIC MANAGEMENT
Strategic Direction Report
Name
Institutional Affiliations

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STRATEGIC DIRECTION AND CHANGE
Executive summary
The following report aims at outlining the Chobani yoghurt company strategy. This
strategy aims at bringing relevant changes in the company performances and growth. The
research uses porter's analyses and SWOT analysis as the tools of analysis. This enhances proper
understanding of the company’s external and internal environment. It also analysis the future
plans and strategy of the company that is adapting to be able to maintain its position in the dairy
industry. Different limitations and constraints that may hinder the implementation of the strategy
are also outlined. Last but not list the report provides justification of the adopted strategy.
TABLE OF CONTENT

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Executive summary………………………………………………………………………….2
Table of content………………………………………………………………………………3
1, Introduction………………………………………………………………………………4
2, Future review of the company……………………………………………………………4
3, External and internal environment………………………………………………………..4
3.1, SWOT analysis……………………………………………………………………………4
3.2, Porter’s analysis……………………………………………………………………………6
4, Theories and literature……………………………………………………………………..7
5, Justification of adopted strategy……………………………………………………………7
6, Constraints and limits………………………………………………………………………8
7, Conclusion…………………………………………………………………………………8
8, References…………………………………………………………………………………9
9, Appendices……………………………………………………………………………………10
1. Introduction

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Chobani Company is an Australian company that deals with dairy products as their main
commodity. It is the best-selling dairy company in Australia. The company uses different
strategies to maintain their position as the leading dairy company in Australia. The research
below evaluates the changes that the company is making on their strategy to attain their goals in
the future. It also justifies the adopted strategy of the company and gives challenges that the
company may face in the implementation.
2. Future review of the company
Choboni has been the leading dairy company and is having a plan in an effort to maintain
their position. The company is looking forward to capturing the world in the near future. The
other plan is line extension. The business is intending to start producing other products other than
yoghurt. The company is also adopting a differentiation strategy to be able to make their product
very different from other dairy companies (Kachouie, Mavondo, & Sands, 2018). Finally, yet
importantly, it has an objective to extend their brand besides the extension of the line of
commodities. From the above, it is clear that the company is still standing and has a great future.
3. External and internal environment analyses
In an effort to assist Choboni company in coming up with their strategic vision and
direction there is a need to understand the company’s environment.
3.1, SWOT analysis
Strengths
The company has a major strength which the stand and status it has within the dairy
industry. Their yoghurt has more proteins compared to other companies. Therefore, the brand is
well known and has a great market share in the dairy market. This has been described as the
“marketing triumph” for Choboni Company. Secondly, the company has a strength based on the
marketing efforts (Fixson, & Rao, 2014). The company has pursued a very good marketing
approach. The company has a strong stand on social media, Press publicity and huge awareness.
This has enabled the company to reach both the specific targets niches and broad swathes of the
population.

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Weaknesses
The company has suffered many setbacks despite the fact that it has a lot of strengths.
The company is not faring well product promotion and advertisement of their product. In
addition, the price of their commodities is very high and discourages many people from
purchasing their products (Ahmed, 2015). The company does not have strong brand recognition
like other companies in the same industry. The target market is mostly female gender and this
limits the company. The company is also experiencing a decline in the market share recently.
Opportunities
The company is having an opportunity in the Chinese market. The Chinese market is
predicted to be the leading market in terms of volume growth and value. The Choboni dairy
company has taken this opportunity in schools and is extending to school lunches. The company
income is increasing constantly which is a great opportunity for the company to expand
(Abdulsamad, & Gereffi, 2016). Finally, yet importantly, the Asian Pacific market has now
increased in the terms of growth and is creating a good opportunity for the company. The
company is having an opportunity to access the global market.
Threats
The success of the company has come along with very many threats. From the time the
company started, it has been performing well in the dairy market and has acquired a large share
in the dairy markets. This success has attracted different allot of competition from other dairy
companies such as Yoplait (Zhuplev, Stefl, & Rohm, 2018). These companies are great
competitors and are a great threat to the company. Acquiring land is also very expensive for the
company. Lastly, the company is faced with a threat of new businesses entering the dairy
industry. These entrants are having more male consumers and therefore are a great threat to the
company.
3.2, Five force porter’s analysis

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Competitive rivalry
Companies such as Yoplait are great competitors for Choboni Company. The company
only offers Greek yoghurt and therefore makes Yoplait and Dannon great her great competitors.
However, the company has been able to secure a good market share in the drinks market than the
other local companies (Beard, 2018). Other then the already existing markets the company is
facing a lot of competition from new entrants who have a lot of male consumers.
The threat of new entrants
Very many businesses are trying to enter into the dairy industry in Australia. This has
posed a great threat to Choboni Company (Dreyfuss, 2018). The company's products are mostly
bought by the female gender while for the new entrants they have more male consumers. The
company is therefore faced with a lot of competition from the companies that are entering the
market
Bargaining power of the consumer
Choboni has left suppliers with a very low bargaining power. It has also reduced the cost
involved in switching suppliers (Kachouie, Mavondo, & Sands, 2018). The company requires
raw materials in large amounts thus giving an opportunity for any company to supply the raw
materials. The company, therefore, is able to shift from one supplier to another because of the
many suppliers available. This shows that the suppliers are having very low bargaining power.
Bargaining power of buyers
Choboni has held a certain bargaining power over their customers because it has a very
high market share in the market. Therefore, the company can increase the prices of their
commodity moderately without having to lose any buyer. On the other hand, those who are high
earners and therefore are not sensitive to increase in prices mostly consume expensive yoghurt.
Threats of substitutes

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Many controversies are associated with the consumption Choboni yoghurt. Some say that
the drink is not healthy and due to a lot of proteins contained in the yoghurt (Saunders, et al
2018). However, Choboni has been able to deal with these controversies by ensuring that the raw
materials that they use are of the best quality. Therefore, even after the controversies the primary
consumers of the yoghurt continues to consume the products. These are mostly the female
gender who get attracted to the sweet taste of the product
4, Theories and literature
Lieberman (2003) says that a successful company in a given industry will strive to
maintain their position by the use of different strategies. The company will do this by creating
barriers to new entrants and exploring new markets from all over the world. The company will
acquire competitive advantages over its rivals. Choboni is one of the successful organizations is
threatened by the new entrants in the dairy industry. The company has set a very high price for
their commodities, which requires that any new entrant will require a lot of money to sustain the
production (Shea, 2014). The company has also differentiated their commodities from other
competitors by use of high-quality raw materials. This is by making their yoghurt rich in protein
and is therefore preferred than other yoghurts. In addition, the company has introduced other
diverse commodities in the effort of extending their line of production. It is, therefore, able to
compete with other companies who deal with the same commodities such as Donnon. Extension
of the market to the other countries is a great investment for the company.
5, Justification of the adopted strategy
Other than price-cutting, the company is concentrating more on modifying their brand
and market strategy. Its strategy is extending in the different region in Australia by use of
appropriate marketing strategy (Wang, Gurnani, & Subramanian, 2018). The company is
extending to different other countries such as the United States of America. This increases the
market for the yoghurt and thus the development of the company. In their effort to make their
products different, the company is coming up with commodities that will suit men consumption
(Fitzgerald, & Priolo, 2018). This will enable the company to compete with the new entrants who
are having more male consumers than women. Making their products different by improving on
the quality is a great strategy for the company.

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6, Constraints and limits
Extending production to the rest of the word is very expensive and needs a lot of time.
The company, therefore, may not be able to extend their production to some countries because of
the cost. In addition, government regulation is a limitation that will affect the company in the
implementation of their strategy (Mohammed, 2018). Governments of the developing countries
discourage other companies from getting to their countries in an effort of securing their local
industries. Lastly producing other commodities is an added cost for the company. Buying land in
Australia is very expensive and therefore limits the company from expanding.
7, Conclusion
Extending production from the primary country to other countries is a good step for the
development of a business. The strategies give the company exposure to new markets and thus
increase in their sales. Diversifying the products of the company is also very essential. It allows
the company to compete effectively with other companies. The adopted strategy will enable the
company to acquire customers from all over the world.
References

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Abdulsamad, A., & Gereffi, G. (2016). Dairy value chains in East Africa. Duke Center on
Globalization, Governance, and Competitiveness.
Ahmed, N. (2015). Resource Review: Euromonitor International’s Passport. Media Industries
Journal, 2(2).
Beard, F. (2018). Comparative Advertising: History, Theory, and Practice. Rowman & Littlefield.
Dreyfuss, R. C. (2018). Harmonization: Top down, Bottom Up—And Now Sideways? The Impact
of the IP Provisions of Megaregional Agreements on the Third Party States.
Fitzgerald, D., & Priolo, A. (2018). How Do Firms Build Market Share? (No. w24794). National
Bureau of Economic Research.
Fixson, S. K., & Rao, J. (2014). Learning emergent strategies through design thinking. Design
Management Review, 25(1), 46-53.
Kachouie, R., Mavondo, F., & Sands, S. (2018). Dynamic marketing capabilities view on creating
market change. European Journal of Marketing, 52(5/6), 1007-1036.
Mohammed, R. M. (2018). Essays on Differentiated Yogurt Market in the United States (Doctoral
dissertation).
Saunders, M. J., Luden, N. D., DeWitt, C. R., Gross, M. C., & Dillon Rios, A. (2018). Protein
Supplementation During or Following a Marathon Run Influences Post-Exercise Recovery.
Nutrients, 10(3), 333.
Shea, M. (2014). Punishing animal rights activists for animal abuse: Rapid reporting and the new
wave of ag-gag laws. Colum. JL & Soc. Probs., 48, 337.
Wang, S., Gurnani, H. B., & Subramanian, U. (2018). The Informational Content of Buyback
Contracts.
Zhuplev, A., Stefl, M., & Rohm, A. (2018). Doing Business in the United States: A Guide for Small
Business Entrepreneurs with a Global Mindset. Business Expert Press.
9, Appendices

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Strengths S
 Recognized as the No. 01
Greek Yogurt brand in
Australia
 All the products are made
out of natural ingredients
Weaknesses
W Price is higher compared
to its competitors
 Consumers are
predominately females
Internal Factors
Opportunities
O  To gain more market share
 Expansion of more dairy
products
Threats
T  Increase of competitors
for dairy products
 Consumers are more
sensitive towards the
price
External Factors