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MKT173 Introduction to Marketing Assignments Solution
Australian environment for business has changed. This change in the business environment has affected each and every industry. Every company irrespective of the industry needs to analyse their internal and external environment. The change in the environment helps the organisation to understand the requirements related to their business that could help them in achieving business success. Apart from the competition is another aspect that is having effect on the decision making of the organisation and it is the responsibility of the management to make plans and strategies that are capable of over passing their competitors (Thaichon, Jebarajakirthy, Tatuu & Gajbhiyeb, 2018). For this it is essential that appropriate competitors are identified. This must be based on type of business both the company does. Kennedy and Wilson is a small chocolate firm producing chocolates from 1995 in the Yarra Valley. This report highlights the buyers behaviour related to chocolate products in Australia. It also analyses micro and macro environment of the cited firm as well as the potential customers.
In the process of expansion, it is highly essential that company does research on the buyer’s behaviour in the country. Since the company has chosen new product development as a mode of expansion hence the buyer’s behaviour becomes further essential. This company wants to expand with the help of new product development. For this understanding the buyer’s behaviour becomes more essential. Australia is a market that loves chocolates and people value taste over the prices. With the increasing inflation there has been decrease in the purchasing power of the people. People have restricted their expenses hence the chocolates the growth in the sale of expensive chocolates have come down (Bliss, 2011). With the increase in the numbers of people in search of chocolates that are value for money, the growth chances is further going to enhance.
The company is planning to bring the chocolates that are highly nutritional. Since the number of people that are facing diabetes and other health issues are increasing day by day hence Kennedy and Wilson will get a good market to target upon. The buyer’s behaviour can also be understood by the fact that there are people that are from different cultural backgrounds and hence their choices have also differed. Since chocolate has also become the part and partial of festivals and occasions. This has given greater sale chances to the company (White, 2014). With not many chocolate products available in the market that are healthy and provide nutrients, it will be an excellent option to the people that needs it. Chocolate gives the feeling of joy and hence people choose it for the celebratory purpose. Australians also loves the chocolates that provide them pleasure with innovative taste. With the numbers of people that are suffering from tension and stress, high rich cocoa products are highly appreciated. Since most of the customers of the company are of very young age hence they demand for products that are at lower cost is high. In the competitive environment brand loyalty is on the lower side and hence the cited firm will have to bring products that are having an exceptional taste and provide health benefits (Aktar, 2013).
In any business there are various variables that are attached with it. There are some internal factors that are actually influencing the internal environment within the organisation. These factors need to be properly analysed so as to understand their impact. The limit and control over the internal factors is very essential for the organisation. In the chocolate industry since there are many internal factors that are influencing the behaviour of the clients and the organisation as well (Boelsen-Robinson, Backholer & Peeters, 2015). Without monitoring, understanding micro-environment could be a challenge for the firm. Since most of these internal factors are linked with the internal units of the organisation hence company should do internal research to analyse these factors. Micro-environment analysis of Kennedy and Wilson are:
Relevant publics: Publics are considered to be as the groups that are influencing the business of the organisation. Some of the most common publics that are attached with the company are the customers (Poelmans & Rousseau, 2016). Customer’s choice is highly essential for an organisation and they must understand the people choice so as to fulfil it. They have a huge impact on the new product development. There are some pressure groups that also exist in the environment. In chocolate industry the pressure groups are like the people from the health organisation who are pressurising the chocolate companies to bring the healthy products. Since the company is bringing the chocolates that are healthy hence these publics will not influence the business of the organisation. Community is the major public who has the role in changing the trends. For example if the trend of sharing healthy chocolates increases, it will enhance the sale of the company’s new product.
Suppliers:There are large numbers of suppliers present in Australia. Due to the competition in between the suppliers the rate of raw materials is going to come down (Roberts, Pettigrew, Chapman, Quester & Miller, 2013). Since the freshness and the quality are very important in the products that are produced by the chocolate company hence they will have to look towards the quality that suppliers give in their raw materials. This company has a healthy relationship with their suppliers hence availing fresh beans of cocoa is not a challenge. New routes and new political ties over trade with cocoa producing nations will favour the company’s idea to develop new products. Adulteration in the raw materials that are supplied by the companies is also a challenge for the small firms like Kennedy and Wilson who do not have high quality technologies to find out these adulterations. In the coming time, the selection of suppliers should be done wisely. It is also seen that the cocoa beans from different regions of the world are have somewhat different taste. This calls for the fact that company should focus on adding the numbers of suppliers from different parts of the world.
Marketing intermediaries: In the whole product cycle there are several marketing intermediaries that are present. In the chocolate industry the will have higher impact especially on the aspects such as elements of market mix and the strategies that made by the organisations (Huang, Weatherall, & Webster, 2012). Since the company does not aim to open their retail outlets hence maintaining healthy relationship with the market intermediaries becomes highly crucial. They have wholesalers in every part of many regions of the Australia. The new product that company is going to launch needs to available in every retail outlets for which they will have to make the relationship with all their business partners. The biggest problems with the small organisations generally are the fact that they have weaker links with distributors. In order to expand their market, the first thing that company will have to do is to exceed the number of investors. The increase in the inflation and economic instability in the country will restrict the new investors to spend high. Along with this the intermediaries in the marketing channel are also important especially for improving the brand name. They will also help the company in reaching deeper into the markets.
Competitors of Kennedy and Wilson
Australian chocolate industry is too big and hence Kennedy and Wilson will have to analyse each of these competitors. With the easy availability of investors, many new small firms are also coming up. The bigger competitors of the firm have the capability to change the trends in the market as well as the taste in the market.
Some of the big competitors of the cited firm are:
Cadbury: It is one of the biggest chocolate companies in the world and has large variety of products for different occasions. It offers various kinds of chocolate products that are also of different taste, having different ingredients, nutritional value. It is also offering products that are long ranging in terms of price. They are targeting large numbers of people from different section of the society and different age group. Their major target markets are the children and young age people (Watson, Kury, Wellard, Hughes, Dunford & Chapman, 2016).
Nestle: It is again one of the big companies that operating in Australia and has products of different kinds of taste. Nestle has a strong hold on the market and offers products that are from different regions of the world. They are also targeting people that are young and love chocolates that do not have high cocoa content.
Hershey Foods Corporation: This Company is known for its different taste of products. It is known for its highly efficient way of bringing products for the customers. They have good distribution line that is capable of making quick supplies to every region of Australia. They also target the people of young age and having high affinity towards the chocolates.
There are many other big competitors of Kennedy and Wilson such as Unilever Group Strauss Elite Shirin Asal Company, Mars Inc., Ferrero Group etc. All these have long ranged products aims to target people of different age group. Along with this there are many small firms that are also present in Australia and are affecting the business of Kennedy and Wilson’s business.
Zokoko: The quality of the products that are delivered by the company is also high hence they have a high capability to produce the fancy and innovative chocolates. They are producing highly cocoa rich chocolate items having different taste from most of their competitors. The tranquilidad chocolate that is having a perfect balance of bittersweet gives an exquisite taste to their consumers. They are targeting people who have love for dark chocolates.
Bahen & Co: They are the wine marker who produces chocolates that are beautiful, stone grown and avails products from Brazil, Madagascar. Most of their products are classy dark chocolates.
Haighs: This is also an emerging chocolate brand in Australia producing chocolates that are having high cocoa content. They use UTZ-certified beans so as to ensure that the farming remains ethical and sustainable business can be done (Kennedy and Wilson, 2018). They are targeting people of different age group who are occasion lovers.
The competition that is present in the company has the changed the dynamic of business in the Australian Chocolate industry (Emari, 2012). It is essential for Kennedy and Wilson to understand the dynamics of Kennedy and Wilson. There are several factors that are influencing the sale of the chocolate products in the market. Some of them are as follows:
1. Demographics:Australia is an ageing society which is again a challenge for the Kennedy and Wilson as they have younger section of the society as their target customers (Spiteri, Olstad & Woods, 2018). There are lot of people in Australia who loves chocolates and are always in search of innovative taste. There are people from different age group having different kinds of taste. The rural regions of Australia still have a greater scope for business process expansion.
2. Political:Australia has seen huge political instability in the last few years where there has been continuous change of governments (Franks, Davis, Bebbington, Ali, Kemp & Scurrah, 2014). With the change in the government, it has become difficult for the companies to have healthy relationships with them which have affected the decision making of smaller firm. It has also affected the supply chain of the organisation. On the other hand government policies have supported smaller firms in their expansion process. Still the increasing tax on the cocoa import has increased the business challenge for the Kennedy and Wilson.
3. Economic: Australia is a developed nation and hence the chances of development for the small organisations are huge (Schaltegger & Burritt, 2017). But the economic challenges such as inflation and increasing unemployment are a matter of concern for the companies that wants to expand. Finding new investors would be a challenge for the company.
4. Social:Society has changed especially in term of demands. Previously people were looking for the chocolates of the big brands. This is because brand loyalty was high (Hamilton & Webster, 2015). Now the people are looking for innovative products that give them different kinds of experience. Since the people are looking for the chocolates that are giving them different kind of taste hence they need to ensure that their new product attract them. Along with this company must be able to bring the new taste for the customers. The number of health conscious people is also increasing and the numbers of such product are lesser in the market. With their new product Kennedy and Wilson aims to capture this segment in the market.
5. Cultural: The culture of Australia loves occasions which directly increases the sale of products (Thompson, 2015). The cultural variances in the country and the diversity are essential for the growth of the company in the coming years. People these days prefer to give chocolates as a gift over other kind of food products.
6. Technological:With the advancements in the technological mediums, the cost of production has lowered. The small firms have to make huge investments in various technologies so as to compete with the quality and quantity that company delivers. Technology will also be very essential for marketing especially when the competition has gone so high (Emari, 2012).
Natural: The quality of Cocoa bean is decreasing in many parts of the world. This has forced the firm to use sustainable approach towards production. Kennedy and Wilson will have to stock a huge amount of raw materials for their future operations.
In order to expand into Australian market with new product development, it is essential that company understand the dynamics of the market and the type of investment they will need. It needs to focus on families as they can also be huge target market for the company. Along with this Kennedy and Wilson will also have to target this gift market. The cited firm will have to add on the number of distributors. This will help the company in managing the gap due to unevenness in the product demand (Schaltegger & Burritt, 2017). Company should also analyse the future plans of their competitors so as to stay ahead of them. It is essential that Kennedy and Wilson make ties with small suppliers also so as to fill the gap that may arise in the business operations. In order to create aggressive and wide reaching marketing campaign Kennedy and Wilson should take use of the social media tools.
From the above based report it can be concluded that Kennedy and Wilson wants to expand its business in Australia and the mode they have chosen for this is the new product development. Australian chocolate buyers mostly prefer the chocolate that is capable of luring their taste buds. The internal environment of the company seems to be positive but they will have to bring control over the internal factors that are affecting their business. Cadbury, Nestle, Hershey Foods Corporation is some of the big competitors of the company having the capability to change the trends in the market. While the companies like Zokoko, Bahen & Co and Haighs are some of the emerging names in the chocolate industry that could give serious challenge to the business of the cited firm. The external environment is facing many kinds of fluctuations and hence companies will have to look towards each of these changing dynamics so as to bring stability in their business.
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