The document is a case study analysis of Hershey's marketing strategy in Malaysia. It provides background on Hershey's as a global chocolate company and analyzes its market share and competitors in Malaysia. The analysis identifies areas for Hershey's to improve, such as expanding distribution channels, increasing promotional activities, and offering a wider variety of products. Ansoff's Matrix is used to evaluate growth strategies and make recommendations, such as market penetration, product development, market development, and diversification. The case study aims to determine how Hershey's can increase its revenues and market presence in Malaysia.
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1. London School of Commerce
Westminster International College
MBA FOR EXECUTIVES
Marketing Management Assignment 1
Model Analysis on Hershey’s Case Study
Lecturer: Dr. Lester Massingham
Tutor: Dr. Eugene Lim
Name: Student ID:
Sara Yeap Th’eng Th’eng 0008VMVM0112
Date of Submission: 14 April 2012
Total Word Count: 4,023
2. Model Analysis on Hershey’s Case Study April, 2012
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Table of Contents
1.0 INTRODUCTION ...............................................................................................4
1.1 Company Background ......................................................................................4
1.2 Company Mission Statement ............................................................................6
1.3 Hershey’s Product Lists ....................................................................................6
1.4 Market Segmentation ........................................................................................8
1.5 Purpose of study..............................................................................................10
2.0 INDUSTRY ANALYSIS IN MALAYSIA .......................................................11
2.1 Competitors’ Analysis ....................................................................................12
3.0 JUSTIFICATION ON MODEL USED .............................................................18
3.1 Overview of Ansoff Matrix ............................................................................18
3.2 Advantage of Ansoff Model ...........................................................................21
3.3 Limitations of Ansoff Model ..........................................................................21
4.0 EVALUATION, DISCCUSSION & RECOMMENDATIONS .......................22
4.1 Evaluation .......................................................................................................22
4.2 Discussions .....................................................................................................25
4.3 Recommendations ...........................................................................................26
4.3.1 Market Penetration....................................................................................27
4.3.2 Product Development ...............................................................................29
4.3.3 Market Development ................................................................................30
4.3.4 Diversification ..........................................................................................30
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3. Model Analysis on Hershey’s Case Study April, 2012
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5.0 CONCLUSION ..................................................................................................31
6.0 REFERENCES...................................................................................................33
7.0 APPENDIX ........................................................................................................37
Appendix A – Price, Location & Variety Observation Results............................37
Appendix B – Quantitative Survey Results ..........................................................40
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4. Model Analysis on Hershey’s Case Study April, 2012
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1.0 INTRODUCTION
____________________________________________________________________________________
1.1 Company Background
Hershey’s - the American’s favorite chocolate, which was previously known as Hershey Foods
Corporation had been established more than a century in the United States. The name “Hershey”
was bear from the founder, Milton S. Hershey ever since 1894 (Wikipedia, 2012). This brand
was known as one of the largest chocolates manufacturer in the North America with having more
than 12,000 employees across the globe (thehersheycompany.com, 2009). It owned several
renowned brands and few of the popular ones are Hershey’s Bar, Hershey’s kisses, Reese’s or
even Kit Kat, just to mention a few. More notable brands can be seen at below figure.
Figure 1, Major Brands and Product Line (Source: Case Study of the Hershey’s Company, 2008)
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5. Model Analysis on Hershey’s Case Study April, 2012
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With all these brands, they managed to gain profits and popularity by plotting at least $5 billion
dollars worth of company’s net revenues with net income of $510 million dollars in 2010 just
from the North America. Not to be surprised, Hershey’s actually dominated the Chocolate and
Sugar Confectionery market share in US, topping the chart at 52.8% while Kraft placed the
second, dominating at 48.6% (Warc, 2011). Albeit Hershey’s has global reach, but more than
90% of its revenues came directly from the United States (Zack Investment Research, 2011)
These awesome Hershey’s chocolates
brands could be found in over 50
countries with 60 different brands. Not
only gaining earnings by its infamous
chocolates brands, they too diverted into
different market segments such as food &
beverages, baking ingredients, toppings
and etcetera. (Hershey’s Food
Corporation, 2009).
Figure 2, Hershey’s Products (Source:http://www.CandyBasket.com)
Before Cadbury was acquired by Kraft Foods Inc on January, 2010, Hershey’s had established a
license agreement with Nestle and Cadbury to market several of its own products. Unfortunately,
Hershey’s plans were disrupted when Kraft Foods Inc came into picture with a much higher offer
over acquisition of Cadbury than Hershey’s (Source). The merger of Cadbury and Kraft Foods
had hurt Hershey’s International Growth prospect as Hershey’s was hoping to expand its brands
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6. Model Analysis on Hershey’s Case Study April, 2012
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through Cadbury’s well marketed solutions worldwide beyond their current marketplace (Zach
Investment Research, 2011).
1.2 Company Mission Statement
Hershey’s has been always striving hard to be number one leader in the American Confectionery
Market by living closely to its mission statement which resonance “Undisputed Marketplace
Leadership” (www.hersheys.com). They strike hard to live with it by turning the consumers’
dreams to reality. (www.thehersheys.com)
1.3 Hershey’s Product Lists
Milk Chocolate Bar Milk Chocolate and Almonds Bar
Special Dark Midly Sweet Chocolate Bar Cookies ‘N’ Crème Bar
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Air Delight Chocolate Bar Drops
Nuggets
Miniatures
Mr. Goodbar Candy Bar Symphony Milk Chocolates Bar
Extra Dark Chocolate Sugar Free Chocolate Candy
Syrup Baking Pieces
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Cocoa Dessert Toppings
Baking Chocolates
Milk & Milk Shakes
Table 1, Hershey’s Full Range Product List
1.4 Market Segmentation
Recognizing market segmentation in a business is vital as it brings us closer to the potential
customer’s needs as the market has become more diverse and it is rare to gain profits from a
mass market. On top of that, it can be used to identify the growth opportunities too (Nelson C,
2002). Different people have their own different preferences and likings and this is where we
should be focused in marketing our products. To segment a vast market, marketers need to
decide in which areas they need to target. It can be in few categories such as gender, price,
interests, location, religion, income, size of household and more (Wikipedia, 2012).
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Figure 3, Example of Income Segmented Group
Hershey’s had made a smarter move ahead of all its competitors especially Mars in the United
States by targeting on adults instead of children by producing a new product; the Kisses. This
move has been proven significant as it has separated itself from its competitors and translated
them into relevant increased profits and market share (MeanGreen, 2008). Nevertheless, this
strategy did not last long as the market trend started to change as due to high sugar content in
Milk Chocolates production, also with the health conscious market, Hershey’s revenue nearly
went flat in 2007 (Dorfman B., 2008).
To gain recovery from the losses, Hershey’s is currently focusing on producing more new
products to venture into Premium Chocolates and Dark Chocolates market. Latest product from
them is Bliss, which is safe guarding them on the Premium segment. They are putting faith on
Bliss to recapture the market share by incorporating with Starbucks Corp. “It’s key for their
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future in that much of the growth in the chocolate category now is in premium and Hershey
really lacks a presence in that category,” said Morningstar Inc. analyst Mitchell Corwin”
(Dorfman B., 2008).
1.5 Purpose of study
Hershey’s had been doing relatively well ever since the introduction of Premium Chocolates in
the United States but it does not seen happening in Malaysia too. Malaysia is ranked at 24th the
largest cocoa exporter in the world (Lascas J, 2011) and there are simply more than 20 brands of
chocolates could be easily found in the stores, be it imported or local chocolates brands.
The main objective of this study was to study on the market share that Hershey’s belongs to in
Malaysia via two different approaches; observation and quantitative surveys. From there, the
author would able to underline on what Hershey’s is lacking and preventing them to grow in
Malaysia. The second objective was to discuss a certain marketing model’s functionality,
advantages and limitations to determine the suitability of the model used for Hershey’s
marketing plan. Whereas providing solutions and recommendations with the help of the
marketing mix falls on the last objective.
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2.0 INDUSTRY ANALYSIS IN MALAYSIA
_____________________________________________________________________________________
The confectionery industry is huge! It is flooded with hundreds or perhaps thousands over
different brands in the world, we are talking just on chocolates brands if you are wondering.
Since the scope is too wide, we are going to narrow down to only analyze the potential
chocolates and cocoa industry in Malaysia.
As Malaysia is ranked 24th, one of the largest cocoa exporter in the world, it is no doubt that
Malaysia is a potential market for Hershey’s to penetrate (Lascas J, 2011). Yet on the other hand,
the revenues they gained in few the Asian regions such as Malaysia, Thailand, Singapore and
Pakistan are lower compared to other region. This is due to sugar, cocoa and peanut are
perceived as few of the most profitable products in the market, which result to obtaining half of
the market revenues. (Del Mundo, Jose Carl, 2011).
To obtain the most updated information in the current market, the author decided to do some
market research in a couple of the well known hypermarkets and convenience stores in Malaysia.
The selected hypermarkets and convenience stores are mostly based in Klang Valley whereby
the densities of shoppers are higher than other areas (Wikipedia, 2012). There are altogether 3
Hypermarkets and 2 Convenience Stores were being observed. They are the infamous Jaya
Jusco, Carrefour and Cold Storage as the Hypermarkets; MyNews.com and 7-Eleven as the
Convenience Store.
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Certain traits are observed as they play the vital role in identifying the market share Hershey’s
has in Malaysia. Among of them are the packaging, location, variety, types of chocolates
produced (white, dark or milk chocolate) and the ultimate one, the price. As Hershey’s relatively
new in Malaysia’s market, few of a more infamous and general brands were analyzed as the
direct competitors to Hershey’s. A few tables were drawn up to sum up the findings which the
author found prevalent factors which affect the market share of it, which can be referred from the
appendix section.
2.1 Competitors’ Analysis
The reasons of why Hypermarket and Convenience Store are chosen to conduct research instead
of dedicated chocolates stores located in shopping malls such as Candylicious or The Cocoa Tree
are the convenience and easy accessibility. Chocolates specialty stores are normally perceived as
expensive as most chocolates displayed on the shelf are the imported ones, hence lowering the
interests of buyers as price is also one of their main concerns that could be seen in Figure 12.
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Figure 4, No Crowds in The Cocoa Trees Chocolate Store on a Public Holiday in Sunway
Pyramid (Source: Author)
While conducting observations in the mentioned stores, these few brands are found rather
intriguing and attractive compared to Hershey’s in which they are:-
Cadbury by Kraft Foods Inc.
Lindt from Switzerland
Ferrero Rocher
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Based on depicted tables in the Appendix A, a market positioning analysis tool would be
deployed to determine the market position Hershey’s stand in Malaysia. This DNA footprint
consists of 8 criterions to be measured among the competitors and they are nonetheless the:-
Price
Location
Varieties
Packaging
Promotion
Public Awareness
Taste
Brand Luxury (Premium)
This tool will be using the scale of 1 to 10, with 1 signifies the lowest score or rather the area of
the product is lacking while 10 signifies the highest score. After plotting each of the competitors’
strengths and weaknesses on the scale, it will be then linked together thus a DNA alike figure
would be seen. The bigger is the DNA footprint is plotted in the figure, the larger market share in
Malaysia they possessed.
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15. Model Analysis on Hershey’s Case Study April, 2012
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Figure 5 DNA Footprint Marketing Position Tool
As seen in the figure, Hershey’s DNA pattern is somewhat Legends:-
small in comparable with its competitors. There are a few Cadbury
noticeable areas in which Hershey’s could be improved
Lindt
from the analysis above. They are the nonetheless;
Ferrero Rocher
Location which means distribution channel, Promotion and
Hershey’s
Varieties in terms of adding more attributes into existing
products.
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16. Model Analysis on Hershey’s Case Study April, 2012
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Location:
While Ferrero Rocher is deemed as one of the premium/luxury chocolates, it plays a good role in
being made available in everywhere such as all kinds of convenience stores (small, medium or
large sized) in different packaging and sizes. Hershey’s has a lot of catching up to do with their
distribution channel as it is seen rather low compared to Ferrero Rocher but slightly better than
Lindt, the Switzerland chocolates.
The reason why Cadbury is seen practically everywhere in Klang Valley and they are able to
diversify their products even on beverages market because they practiced localization marketing
strategy in Malaysia. They have a factory (Cadbury Confectionery Malaysia Sdn. Bhd.) in Shah
Alam, Selangor and cost on production and exporting are greatly reduced, thus it also explains
clearly on why their price could be much lower to compare with the rest.
Promotion:
It refers to an incentive used by a manufacturer to induce the trade and/or consumers to buy a
brand and to encourage the sales force to aggressively sell it (Terence A. Shimp, 2000).
Hershey’s in this sense is lacking on a lot of sales promotions in comparable to others. There was
barely any advertisement broadcasted on the media, not even on newspaper to enlighten the
public with their newer products such as Nuggets. Hershey’s was rather quiet in Malaysia to
compare with US. Every month they will have special consumer promotion with slashed down
price of chocolates to promote their products (www.hersheys.com). Cadbury on the other hand
offen includes their latest product with their existing product to have “buy 1 get 1 free concept”.
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Varieties
Having a wide range of the same products mean adding more value to the brand; however it is
not guaranteed profitable. At times, offering greater product variety is usually associated with
higher cost (Draganka and Jain, 2005; Lancaster, 1979). Unlike Cadbury, Lindt and Ferrero
Rocher, Hershey’s offered a very limited range of products in Malaysia. Given the impression
the product management is rather inactive and boring to the public.
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3.0 JUSTIFICATION ON MODEL USED
____________________________________________________________________________
After a thorough analysis performed on Hershey’s market share in Malaysia, Ansoff Matrix was
chosen to redefine the Business Strategy in which Hershey’s should be adopted to increase their
revenues and presence in Malaysia. Ansoff Matrix was chosen over the infamous BCG model
because BCG focuses on SBU (Strategy Business Units) more. At this point of time, Hershey’s
had been doing fairly well with its existing products in the United States but not every product
available in the US, available in Malaysia too. Hence, analysis of SBUs of Hershey’s is not
appropriate in this study as the few products that brought into Malaysia were the ones which top
the revenues for Hersheys; the Kisses.
3.1 Overview of Ansoff Matrix
ANSOFF’S GROWTH MATRIX
(Figure 6, Source: Usha CV Haley, Strategic Management in the Asia Pacific, Pg. 249)
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The Ansoff Matrix was introduced by H. Igor Ansoff in 1957 in one of the Harvard Business
Reviews conference. It consists of four main areas built around a two by two matrix, which could
assist business men to decide in which strategies from the four growth quadrants, could provide
opportunity for their product or business to grow (Simister P, 2011).
This matrix takes four potential strategies to grow a business by leveraging new or existing
products via new or existing market (paramouthlearning, 2010). Risks would be increased each
time as we move into a new quadrant be it horizontally or vertically (Manktelow J, 2006). The
four directive strategies are named as follows (Ansoff 1957):
1. Market Penetration
It is the safest guard to grow a business as it does not involve many resources. This
strategy mainly focuses on increasing the market share by recapturing existing or new
customers with having intense marketing promotions to straighten the customer value
(Simister P, 2011).
Able to dominate the market by either price reduction strategy or mass promotions to
retain existing customers, competitors’ customers or new customers
2. Product Development
It lines the second least risky strategy whereby existing product would be replaced
with something greater, be it new packaging or develop similar product with more
variety to choose from. The new products are normally sold to the customers through
existing distribution channels (Simister P, 2011).
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This strategy involves product innovation, product augmentation and product line
extension to satisfy buyer’s need
3. Market Development
This strategy gives open up the growth opportunity in new areas or new market with
the same products to different people. For instance, instead of targeting on the same
geographical of people, we could move further in selling our products to oversea, etc
(MindTools.com, 2012).
4. Diversification
This strategy stands the most risky decision to put into practice as diversification
involves throwing in more resources in putting up new products to the untapped
market (new customers) (MindTools.com, 2012). The new product can be either
related products in an existing market or with totally unrelated products that
unconnected with the existing products and markets (Tutor2u, 2010; Haberfellner,
2009).
There are several diversification strategies which are broken down to:
o Horizontal Diversification
o Vertical Diversification
o Concentric Diversification
(Source: The National Agency for Innovation and Research in Luxembour, 2008)
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3.2 Advantage of Ansoff Model
One of the most said advantages of the Ansoff Model is the flexibility of defining several
strategies simultaneously (Wood J.C & Wood M.C, 2007 pg.54). It provides simplicity with the
direct 2 by 2 dimensions overview which allowed managers or marketers to start planning their
current or future market and product development with Ansoff Model (Bachmeir K, 2008).
Furthermore, it helps us to identify the full range of choices for expansion in a more customer or
market centric way (socialenterpriseworks.org, 2009). Ansoff matrix is the only model which is
able to provide an insight on diversification strategy especially on the ability of changing brands,
be it acquisition or merger with another competitor.
3.3 Limitations of Ansoff Model
Often said simplicity is only good at giving a head start or a pinch of salt of how the whole
picture looks like. Nevertheless simplicity does not tell us the full details on how to achieve the
planned strategies. It is only measured by two aspects: product and market. It does not take
company’s resource, risk associated with each choice, the extent to which each choice leverages
a company’s core competences into account (Bachmeir K, 2008; Pearson A, 2010). Generally,
Ansoff Model would be best used in conjunction with other notable models such as Porter
Matrix, Gap Analysis, SWOT analaysis, and BCG etc and not isolated, to help think through the
choices (Pearson A, 2010). Recommendations made on the based on the model are not concrete
and lack in depth which disabled us from viewing the whole picture (Papers4You.com, 2009).
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4.0 EVALUATION, DISCCUSSION & RECOMMENDATIONS
______________________________________________________________________________
4.1 Evaluation
There were 10 simple questions put up on the Internet and approximately 100 respondents
answered to it. Their opinions and suggestions are essential for this study as the strategies
proposed are mostly evolved to their responds in this survey. However, not every question would
be analyzed and put into the deliberation of the strategies. Detailed questions and results could be
obtained from Appendix B.
Figure 7, Demographic – Gender Figure 8, Demographic – Age Group
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Figure 9, Chocolates Consumption Figure 10, Brands Preferred
Figure 11, Ultimate factors of chosen choice
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Figure 12, Chocolates Benefits Awareness Figure 13, Concern Chocolates Consumption
Figure 14, Reason of chocolates consumption Figure 15, Factors influence in buying decision
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25. Model Analysis on Hershey’s Case Study April, 2012
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4.2 Discussions
Alarming, Malaysia is the world’s 8th most sugar consumption thus crowning the diabetic charts
in the world whereby every 7 out of 10 Malaysia adults suffer from chronic diseases (Consumer
Association in Penang, 2011). This is really concerning as Datuk Tan Lian Hoe confessed that
“Increased number of obesity and diabetes among youths who are the future leaders of the
country” is her greatest worries in launching the Dutch Lady Malaysia’s “Reduce Sugar”
campaign (malaysiandigest.com, 2011).
As seen in Figure 11 & 12, the public fears to consume chocolates because of diet (health) issue.
A chocolate in contrast, does not play a role in contributing weight and diabetic. In fact, they
bring health benefits instead. Reuter (2012) stated that “People who ate chocolate a few times a
week or more weighed less than those who rarely indulged”. Malaysian Cocoa Board wrote an
article on Cocoa and came out with 6 facts (1998):
i. Chocolate does not cause acne
ii. Eating chocolate does not make you fat
iii. Diabetic people can consume chocolate
iv. Chocolate does not cause dental caries
v. Chocolate does not cause heart disease
vi. Chocolate is an aphrodisiac (intend to improve one’s mood) (Wong SY & Lua PL)
Research showed that there were several issues to be addressed:
1. Brand image of Hershey’s is not convincing enough in the face of competition.
Consumers were not impressed by the lack of promotion and product variety
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2. One of the core products of “Hershey’s Kisses” received over 80% of revenues in US but
received only a small proportion of advertising and promotions pricing.
3. Less than 1/3 of Hershey’s products are available in the stores and they need to be
repositioned.
4. Diet is the main concern among the chocolates lovers and sadly, majority of them are not
aware of the benefits it could bring to them.
5. Many of them consume chocolates as snacks whereas some purchase it for gift purposes
6. Sales/Consumer promotions played at utmost factor in buying decision and Hershey’s is
nowhere seen near there.
7. Many of us have misconception on Chocolates would deteriorate our health but in fact, it
improves on cardiovascular system
4.3 Recommendations
Upon recognizing the problems, solutions and strategies are to be developed via Ansoff Model.
There are two quadrants to be used from the model with the help of 7Ps marketing mix as Ansoff
Model alone will not be able to provide end-to-end solutions.
Market
Existing New
Product Market Penetration Market Development
Existing Bring in existing Join forces with Coffee
products from US to Bean/Starbucks to
Malaysia by include Hershey’s syrup
collaborating with a third or baking products for
party manufacturer their confectionery
Organize a competition products
for Kisses’ straps
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collection and win a trip
to Hershey’s World of
Chocolate to increase
brand image and market
share
Compose branding song
and slogan to boost
company’s brand
Continue to produce
small packaging for up-
to-date market trend
New Product Development Diversification
New New Market Segment on Venture into mobile
Health/Weight Conscious games in Apple and
group Android platform
Products could be in
nutrition bars form with
higher cocoa content
(dark chocolate)
Educate the public on
health benefits reap from
Dark Chocolates
Table 2, Ansoff Matrix Analysis on Hershey’s
4.3.1 Market Penetration
a) Place
To ease the cost of exporting or building a factory here, Hershey’s could
collaborate with a third party manufacturer to manufacture its chocolates. Of
course the Quality Control of the products is to be monitored by Hershey’s.
When production cost is low, more existing products sold in US could be
produced and sell in Malaysia’s market to increase their revenues and presence by
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28. Model Analysis on Hershey’s Case Study April, 2012
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having them on the stores’ racks rather than specialty stores such as KLIA and
Langkawi Duty Free Zone (Both are well known for imported goods but very
costly)
b) Promotion
They have to invest at least some funds in advertisement to create public
awareness online through Facebook, Twitter or Google +.
They could have more consumer promotions. For consumer promotions, they can
organize an event or competition by purchasing more Hershey’s kisses for
collectable paper straps from the Kisses. Currently messages such as “I miss you”
or “I love you” could be found on the strap but Hershey’s could produce more
lovely messages and organize a competition from there. Customers are to collect
it and make up a love story from there and the winner could walk away from
grand prizes like a visitation trip to the Hershey’s Chocolate world in US or vise
versa.
They could look into sales promotions too as perhaps buying 1 large pack of
Hershey’s kisses would free 3 mini bars of Nugget. This strategy will save the
cost of trying to market and promote Nugget product. Letting the customers
themselves taste the product marks the best marketing strategy.
Composing a fun yet rhythmic songs with a slogan would certainly help
repositioning their brand in the market.
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c) Packaging
Hershey’s could grab hold of opportunities such as festive seasons in Malaysia.
Malaysia is a multi-national country with more festive seasons to compare to
other country. Packaging of the products could go according to the festive
seasons. They could start experimenting in Malaysia by bringing in the idea of
Easter day, Halloween or Christmas packaging as well as Malaysia is celebrating
it too before starting to venture to other festive seasons such as Chinese New Year
or Hari Raya. Having unique designs for the particular festive would attract
buyers to present them as gifts (Figure 11).
Continue to produce smaller packaging as it is a market trend right now. As seen
in Figure 11, buyers tend to have chocolates as snacks. With smaller packaging,
consumers need not worry on how to handle remaining chocolates (Euromonitor
International, 2011)
4.3.2 Product Development
a) Product
New product such as higher cocoa content could be accommodated to new market
segment for Hershey’s. This time round they would be targeting on the health
conscious consumers who are afraid to gain weight yet chocolates indulger.
Higher cocoa content chocolates tend to taste bitter when sugar content would be
decreased too. In this sense, Hershey’s could produce a product range ranging
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from percentage of cocoa content for selections. For examples, 50%, 60% or even
70% of cocoa content.
Products could be delivered in form of nutrition bars, perhaps with some mixture
of grain ingredient.
b) Promotion
Hershey’s could educate the public on the benefits of one chocolate could bring
via social media such as Twitter or Facebook as they are free.
They might include road shows in the malls to launch the new product with
sampling given to public to try for at least a week to see the benefits reap from
dark chocolate especially on diabetics (sugar level) and cardiovascular system.
4.3.3 Market Development
To increase their revenues in Malaysia, they could join forces with Starbucks or Coffee
Beans with their bakery products such as Hershey’s syrup or toppings on their
confectionery.
4.3.4 Diversification
Venture into mobility world by creating some adventure games on Apple and Android
platforms that relate to Hershey’s brand. This strategy would help to create awareness
among the public, especially the children who love cute figures in games, to close the gap
they are losing on the market share. If the games are proven profitable, they could
endeavor into merchandise route.
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5.0 CONCLUSION
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As market evolves, it is no longer product-driven to sustain in the competitive market. In fact,
the customers are the one who controls and determines the product’s life cycle! Stunning but
true, if the product does not fit any purpose in one’s daily life; they would not even consider it
unless it is something extraordinary. To maintain and to pro-long the profitable period of a
period, marketing strategies need to be taught off.
Ansoff matrix indeed helpful in identifying growth opportunity in a business but it does not lay
out what are the precautions steps and strategies in details. However, we can combine analyzed
results from other models to judge whether is it workable with a particular quadrant used. In this
case of Hershey’s, since the presence and market share in Malaysia is low, hence growth
opportunity is vast. Nevertheless, to seize a correct strategy in a correct quadrant is rather
confusing with Ansoff matrix. Although there is a modified, high level of 9-grid matrix, the
difference of each of the quadrant is just between a thin-fined line.
To overcome this confusion, perhaps a fixed Product Life Cycle graph (PLC) and Ansoff matrix
combination model for easier strategy brain storming. Below figure is just a brief idea of how it
looks like, further research needed to prove its usability.
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32. Model Analysis on Hershey’s Case Study April, 2012
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Figure 16, Brief Model of PLC + Ansoff Matrix
Besides this model, other models such as Promotions + PLC and Building Demand for Product
model could be considered into Hershey’s case study too as they are in need of Promotions and
Demand strategies for their existing products. Overall, this report has met all three objectives
mentioned which are, study on Chocolates Industry on Malaysia, study on Marketing Tools and
provide solutions and recommendations.
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6.0 REFERENCES
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29. NAIDU R - Koko.gov.my (2012) Malaysian Cocoa Board Official Website. [online]
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7.0 APPENDIX
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Appendix A – Price, Location & Variety Observation Results
CADBURY BY KRAFT FOOD INC.
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FERRERO ROCHER
LINDT – SWITZERLAND
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HERSHEY’S
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Appendix B – Quantitative Survey Results
1. Are you Male or Female? Response Percent Response Count
Male 48% 48
Female 52% 52
2. Can you tell me your age group? Response Percent Response Count
0-22 6% 6
23.35 72% 72
36-55 20% 20
56 & above 0 0
N/A 2% 2
3. Do you consume chocolates? Response Percent Response Count
Yes 96% 96
No 4% 4
4. Which brand of chocolates do you prefer? Response Percent Response Count
Hershey’s 20% 20
Cadbury (Kraft Food) 30% 30
Lindt 6% 6
Toblerone 14% 14
Others: 30% 30
Van Houten
Godiva x3
Imported Dark Chocolates
All of the above
Reeses (Hershey)
No specific brand
Cote d’Or x2
Any Belgium Chocolates
Neuhaus
Ferrero Roche x5
5. Please tell me the ultimate factor of your Response Percent Response Count
chosen brand
Price 2% 2
Taste 76% 76
Packaging (attractiveness) 4% 4
Convenience 0 0
Mixtures of variety flavor 8% 8
Branding Status 8% 8
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Others 2% 2
Ingredient
6. Your purpose of purchasing chocolates Response Percent Response Count
Daily needs 2% 2
Gifts 18% 18
Snacks 74% 74
Others: 6% 6
Crave
All the above x2
7. Are you aware of the possible benefits from Response Percent Response Count
chocolates?
Yes 46% 46
No 54% 54
8. What is your main concern in chocolates Response Percent Response Count
consumption?
Price 40% 40
Diet 46% 46
Others: 14% 14
Energy
Sugar content – may lead to diabetes
Constipation
Taste
Interest
Snacks
9. What other factor will influence you in buying Response Percent Response Count
different brand of chocolates?
Promotion 36.63% 74
Word-of-Mouth 18.81% 38
Advertisement 19.80% 40
Campaign 11.88% 24
Competition 5.94% 12
Convenience (such as delivery) 5.04% 10
Others: 1.98% 4
Introduce by friends
Sampling
10. Are you a initiator in purchasing new Response Percent Response Count
product launched in the market? (Definition of
Initiator: A person who often tries out newly
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launched product without influenced by others
by their feed backs and in return will
initiate/persuade others to try it)
Yes 46% 46
No 8% 8
Maybe 46% 46
Source: http://www.surveymonkey.com/s/8YPT9VJ
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