Cadbury-Company and Marketing External Situational Analysis

Introduction

Several companies share large markets in the United Kingdom in Chocolate and Confectionery Production. With an external analysis evaluation in Cadburys chocolate confectionery brand, the company is Cadbury, formerly Cadburys and Cadbury Schweppes. This particular company makes production, markets, and sells products of chocolate confectionery, and the range of products includes chewing gum and cough brands, confectionery, and chocolate. According to statistics based on a million responses from the public, popularity, which is the percentage of people with an attitude that is positive towards a confectionary, shows that Cadbury is 83% popular, which comes second after Maltesers at 84%. The adults in the United Kingdom who eat chocolate are rated 94 %, with 61% eating chocolate more than once a week. The critical role of this is the emotional links of chocolates which is why it is consumed throughout the day. The analysis of the external environment of Cadbury Company will be outlined. This will include identifying opportunities in the market of the United Kingdom that the company can act upon and the threats ahead so that the company can avoid. This will then lead to proposals of modified products for the Cadbury portfolio.

Macro Environment Analysis

A PESTLE analysis of Cadbury demonstrates that the multinational confectionery company has addressed changes and pressures in the United Kingdom macro-environment and internationally. A particular emphasis will be made on the U.K. since this was the companys originality.

Political

The change of government from Labour party to Liberal Democratic in the United Kingdom context is bound to have so much influence on the operations of Cadbury Company (Arya and DineshBabu, 2021). According to the estimates that have been made lately, the eight Cadbury factories that are situated in the United Kingdom had a total of three thousand employees. However, Cadburys hiring decisions in the future may be affected by the stringent restrictions on the entry of workers who are skilled from the rest of Europe.

Another political factor that may affect the management of Cadbury, its payment to the shareholders, and the companys investment is the imposition of taxes. An example, in this case, is the rise of Value Added Tax in 2010 by 2.5%, which contributed to the increase in chocolate prices hence a reduction in sales (Arya and DineshBabu, 2021). Moreover, in 2007, Cadbury Schweppes, in the face of increasing expenses on operation and reduction of margins, decided to outsource a large portion of H.R. and accounting to a firm belonging to the Indians. This can result in the loss of many jobs to other business units that may decide to follow suit. Conversely, this will lead to employment opportunities in countries like India.

Economic

With the global downturn, Cadburys expansion plans reduced the customers disposable income, but the sales remained steady. Surprisingly, the company was able to have an annual increase in profits by 30%, especially on the sales made from Trident and Dairy Milk. However, due to the recession, the company was only able to hit their revenues lower end of 4-6% in 2009, which marked the recessions peak. Dairy Milk and Trident Gums sales were good, and even the other brands, for example, Halls, increased their annual sales. Cadbury has focused on new recipes to address the rising production due to the cost-conscious environment.

Social

Cadbury Company is run by the Quaker family, whose primary basis of running the company was the opposition to selling alcohol. The company deals with the sale of coffee, cocoa, liquid chocolate, and tea which are socially acceptable worldwide; hence the company was born due to social factors. However, even though these products are socially acceptable, there has been controversy about the products catering to the Muslim markets since they are Halal Certified. Concerns that there are increased cases of obesity due to the consumption of chocolate, especially by nutritionists, may affect the company in the future.

Technology

The companys production and packing process has been affected by technology over the years. This is with new machines that blend cocoa and coffee gains. Concerning this, some moves like using systems that test pathogens have been made, and chocolate heat-resistant filing patents have been used. Technology also helps Cadbury reach out to its customers through social media, creating awareness for its products.

Legal

The company finds it necessary to maintain stringent copyright regulations because small companies that sell local brands try to use its logos and the symbols that the company uses. Legal laws demanding that each producer display contents on the packages of their products are more severe in European countries than those in other regions like Africa. Concerns arising from obesity issues may impose stringent laws on taxes on sugar. This is a threat to the company because its aim of expanding should keep a tab of the laws in those regions. The company, however, has a good brand name that makes it easier to be acceptable in new regions.

Environmental

Cadbury has the drive to fight against the change of climate, which is a regulation set by the U.N. that requires companies to reduce the emission of carbon dioxide through their operations. This can be achieved by educating farmers to be more productive in eco-friendly environments. Though its cocoa life program, Cadbury aims to reach out to more farmers to teach them about reducing pesticides and creating a positive perspective about preserving the environment.

Micro Environment Analysis

Five Forces Analysis

The bargaining power of suppliers- the degree of differentiation determines the strength of suppliers. Portions of the sales made by the company are gotten from a specific firm; for example, it obtains cocoa beans and butter from Venezuela in Wes Africa. The company has many suppliers, but none takes more than 10% of raw materials. Therefore, the suppliers have a minute influence on the company, and to ensure security, the company sins long-term contracts. The suppliers, in general, do not have power over the company. For example, sugar is bought through quota by the price quoted by European Unions.

Bargaining power of customers- the products in impulse goods are sold to...…the demand for candy increases (HIDIRO?LU, 2019).

The efficiency programs and the level of growth of the Cadbury company help bring in high saving costs in the firm. Cadbury has a healthy thought of actions in matters relating to Research and development.

To maintain a front-runner in the market, innovation is critical, hence in this case, considering consumers health. Hence Cadbury should seek to have sugar-free products because of the constant demand for natural, low-fat confectionary.

New Marketing Ideas

Although it faces various threats in its activities, Cadbury Company continues to grow and make developments. Opportunities are also available responding to the target market and the marketing activities best suited to reaching out to the intended audience. There is the foremost opportunity that the company could have its business developed to target those markets in Russia, Nigeria, and China. These three countries are known for their large populations, and they are still growing. There could be an increased market for confectionery because the demand is high as the population increases. The company co-branding with other brand industries is another excellent marketing idea. This would help in capitalizing on more advertising opportunities.

For example, in this case, this company would co-brand with food industry ingredients like ice cream and milk. Benefitting the economy of Cadbury would include adapting to the recent food trends, which propose organic and low-fat foods to accommodate the consumers preferences. This would be made possible by introducing more sugar-free options and options with low calories in their range of products (Essegbey and Ofori-Gyamfi, 2012). There are several opportunities for the company to develop in the future to create a variety of products and have an expansion on the type of products they offer. With the improvement of technology and machinery, there is an opportunity of coming up with new products in the most obvious and possible way. Another chance Cadbury could utilize is the new technology under development globally to have their company more global. However, they have achieved this partially through the creation of online websites. This could, however, be taken to a notch higher by introducing an application of tablets and phones for the Cadbury Company.

The company is most likely to face threats from the more confectionery businesses, further making developments in their companies and products (Essegbey and Ofori-Gyamfi, 2012). More industries with stiff competition are coming up, creating competition within the industry field. For example, Nestle and Mars are the biggest Cadbury competitors, and with the aggression of prices, a price war may be caused, which is a threat to the company. These threats, however, may be averted by the company if it embraces the new marketing ideas discussed to reach out to more of its intended or target groups.

Conclusion

With its organized structure providing products of high-quality analyses, its environment is well. This is effective to the companys decisions, and to produce the market needs, Cadbury can use very effective marketing strategies. Product diversification establishes a new partnership when it enters the market. Therefore, Cadbury should practice high performances to…