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10 Old Grimsbury Rd, Banbury OX16 3HG, UK

RBP020L061A Strategic Marketing

  • What % of marks (if any) are awarded for presentation of work and referencing: 10%
  • Word limit:3500 max excluding references and appendices

Solution:

FINAL REPORT

Part 1: Introduction and Product/Service description

The company I have chosen for this report is Cadbury. First established in 1824, Cadbury is the second biggest confectionery brand, following Mars (Bailey and Alexander, 2019, pp. 659-680). The headquarter of Cadbury resides in Western London, Uxbridge with 50 plus countries under its operation. Even though it is considered one of the best British brands for its successful exports, its focus on e-commerce is scanty. Cadbury has never introduced an e-commerce site for its customers. However, Cadbury has a Cadbury gifting site where the personalized chocolates and other Cadbury products would be delivered to the customers yet that would not be tantamount to the growth of e-commerce in the present era of post-pandemic. People find it hard to get out to the nearby retail stores to buy products. Unlike past years, the world population has driven more towards digital platforms more recently and this has been a potential time for all e-commerce businesses (Shah et al., 2020). And this would be the right time for Cadbury to step its foot on e-commerce businesses such as Samsung, Hims and so.

Usually, Cadbury followed business to business approach (B2B) where the product is not directly shipped to its customers rather it would first meet the retailers (either it is Amazon and so, or any brick-and-mortar shops). But with the help of business to customer approach (B2C), Cadbury could sell the products at the market retail price which is more than selling to the retailers who then sell them for market retail price, and would be assisting directly to get in contact with the customers to comprehend their needs and opinions of the product (Seghezzi et al., 2020, pp. 456-472). So, the report would be focused on the e-commerce business development in Cadbury since it would increase the cash flow and helps to know their customers more explicitly.

Cadbury can sell their products directly at the cost fixed by the market just by removing the intermediary retailers and replacing them with digital platforms. Cadbury has to develop a mobile application that could help its customers to buy authentic products with a reasonable price tag on them. Recent developments in e-commerce are the incorporation of Artificial Intelligence (AI). With the help of AI, Cadbury could develop chatbots that would easily interact with the customers 24/7 and would direct customers to the particular person in the company in case of a complicated situation (Adam, Wessel, and Benlian, 2021, pp. 427-445). Next to AI is Augmented Reality (AR), which would use for the customers to easily search for the product they are searching for (Harrisson-Boudreau and Bellemare, 2021, pp. 789-797). Customers often get confused about the similar-looking products in Cadbury’s Dairy Milk, for instance, the distinction between Big Taste Oreo Crunch and Big Taste Triple Choc are just their names and taste. There are possibilities to order the wrong chocolates which would disappoint the customers, so to eschew such possibilities it is important to incorporate AR.

Another important use of e-commerce sites would be their freedom in customization. For instance, if the customer is a diabetes patient, then his search history on the site or application would have products with less sugar. So, accordingly, the Cadbury sites would offer the customer chocolates such as Cadbury Dairy Milk 30% less sugar. This way Cadbury could hold its current consumer populace and retain the lost consumers too. So, e-commerce in Cadbury is more than a necessity now.

Part 2: A critical analysis of the market context

With the pandemic in action, e-commerce has been proliferating in the market with multitudes of customers preferring the ease and comfort it provides compared to the traditional brick-and-mortar stores (Hasan, 2019, pp. 16-23). Since e-commerce is dependent on social commerce and digital marketing, and over 60 percent of the consumers are said to use social media platforms the e-commerce marketing will burgeon the consumer reach easily when compared to traditional ad campaigns (Vu, 2021). And almost 39 percent of the consumers obtain the assistance of AR to buy food and beverages (Centric Digital, 2017). And in the case of chatbots, it is estimated that by 2023 over 70 percent of the retail business would be based on this technology (Woodford, 2020). And chatbots are anticipated to curtail customer service costs by 30 percent in every business (IBM, 2021). Due to pandemics, over 20 percent of the UK population is buying their groceries online rather than traditional shopping (Apptus, 2021). And it is found that over 90 percent of the marketers in the leading position say that personalization has predominantly waxed their profitability over time (Hardimon and Fisch, 2018). So, it is now or never a situation for Cadbury to bring in its e-commerce business to keep hold of its customers from boycotting the brand for its lack in providing personalized chocolates and effective customer service with comfort in purchasing.

With the rising need for door-step delivery, many brands have contributed their share in e-commerce. If Cadbury executes an e-commerce department, then it will be competing with the businesses like Tesco, Asda, Ocado and so. Since confectionary E-shopping will be new to the market, the report will emphasize more on general grocery e-shopping businesses. Like Dominos that sells its product to its customers directly, Cadbury could try this e-shopping strategy. The primary competitor in the UK would be Tesco, a merchandising retailer whose net online sales have surged from 4,000 GBP in 2014 to 8,000 GBP in 2022 (Peters, 2021). The products include different groceries, chocolates and so. Another key competitor would be Asda. They are planning on distending their online capacity up to a million slots per week of 2021 (Suel and Polak, 2017, pp. 147-162). With such plans, the market would soon be dominated by Asda. To avoid involving an intermediary between the customers and the company, Cadbury has to incorporate the e-commerce idea. The third primary competitor would be Sainsbury, being the second-largest supermarket chain in the UK it offers various incentives to its customers in buying the products displayed on their e-commerce site. They also provide options to choose a one-hour delivery mode if the purchase is an emergency. Overall, Tesco grabs 36% of the UK’s online market, Asda covers 31%, Sainsbury 13%, and the remaining 20% is shared by Ocado, Marks & Spencer, Iceland, and Waitrose (Dudovskiy, 2021).

The consumers were once skeptical about the authenticity of the products and services provided virtually, however, a recent hit by pandemic has swapped their mentality on e-commerce dramatically. In 2020 alone, more than 84% of consumers have preferred to shop online (Linnworks, 2021). People feel very convenient and comfortable in ordering the product they need just by sitting on their cushion couch. Convenience is the key element that made e-commerce propitious. Bygone are the times when people used to stand in a queue in front of a billing counter to purchase groceries and other products, now just with a click and with the assistance of mobile payment applications, consumers could easily buy the products they desire. Recently, e-commerce has also played a crucial role in truncating the spread of the virus by letting the customers purchase online assuring their health and safety.

Part 3: Segmentation, Targeting, and Positioning (STP)

The market segmentation can be classified into four criteria: demographic (B2C), firmographic (B2B), psychographic (B2B/B2C), behavioral (B2B/B2C). The Cadbury e-commerce would be based on three market segmentation, one will be behavioral segmentation since it has to concentrate on the consumer’s buying pattern or their behavior towards the product they search or purchase to customize the e-commerce site effectively as well as to build constructively the AI implemented chatbots, secondly the psychographic segmentation to comprehend the opinions and interest of the consumers to develop the product accordingly as well as to market the products that trigger their interest further to proliferate the possibility of purchasing, and finally the demographic segmentation to specifically identify the needs and likes of the consumers at a different age group, community, gender, health. Demographic segmentation will help Cadbury to know the market sales of the product with its key buyers, and will also help to understand the key target communities for various products displayed on the e-commerce site.

The demographic segmentation delineates the consumers according to their ages, family structure, income, gender, nationality and so. It is very crucial for Cadbury since it would provide some rudiment insights into the target population. Cadbury has multiple branches in various countries irrespective of their developmental stages. If the branch resides in a low economy nation, then it would be unpropitious to fill the shelves with the costliest chocolate product, spending money on chocolates would be the least concern for such communities. These cases could only be understood with the help of demographic segmentation. Also, young consumers would prefer more chocolate content in their purchase whereas elder consumers could prefer nuts and other dry fruits to be present in their product, and accordingly the site must display to make them buy. It is a well-known axiom that consumers do not know the presence of such a product unless we show them. Whereas behavioral segmentation has been effective in identifying the buying habits of the consumers (Maccarrone-Eaglen and Schofield, 2020, pp. 57-76), in comprehending the needs of the consumers so that accordingly the products could be displayed such that it would not disappoint or boycott the Cadbury products completely (Camilleri, 2017, pp. 69-83), and Cadbury could develop rigid brand loyalty with its consumers by providing the specific content that they require (Deliana and Rum, 2017, pp. 51-61). Finally, psychographic segmentation is the understanding of the psychological attributes of the consumers such as their personality, attitudes, opinions, and lifestyle. Unlike the demographic segmentation where the line is drawn with the help of their income and their age group, with the population of more than seven billion all around, it would strenuous to market-based on just demographic segmentation. So, Cadbury has to incorporate all of these three market segmentations while executing an e-commerce site of its own. For instance, if the consumer is suffering from gluten intolerance (a bad reaction towards milk chocolates), then the site must avoid displaying any such chocolate products so that the brand could gather its loyalty and credibility from its consumers.

Profile and persona of the target market:

The profile of the target market comprises the populace who are unwilling to approach any brick-and-mortar shops for purchasing groceries or food products. Since the world is booming with new technologies and developments in e-commerce, the B2C approach for Cadbury would be propitious and would increase the revenue by curtailing the incentives while selling the product to any intermediary retailers. For developing an effective persona of the target market, it must include information such as who the target market is? Where are they? Which aspect motivates them? Their problems and pain points, and what are their preferred media to approach them. And finally, it must comprise when would be the right time to market.

  1. Who are they?

The key target market Cadbury has currently been focusing on is children with age groups between 5 to 15. Chocolates are always inevitable when it comes to one’s childhood. The taste of the sweetness bursting out a colorful cracker inside our brains every time we chew them, those feelings are priceless and they must uncompromised. Being so, with the lockdowns and multitudes of traditional candy shops being closed, it was hard for the children to buy chocolate without any other added grocery else the delivery charge should be provided more. So, to truncate such bad situations Cadbury’s e-commerce site would be helpful. It is the idea of Cadbury to present a virtual candy shop to all the children and let them order their favorite at ease.

  1. Where are they?

The customers would be connected with the Cadbury retail stores nearby their locations specified while ordering the product. Now the focus would be on the target population in the UK.

  1. What aspects motivate them?

The idea of bringing a virtual chocolate store will be enough to stimulate them in buying the product. The convenience and comfortability provided in the purchase would motivate them. In a fast-moving world, it is hardly possible to spend a separate time going to a nearby retail store in buying a Cadbury product. So, marketing them with convenience and easy accessibility will trigger them to availing this e-commerce service.

  1. Problems and pain points:

First of all, the lack of social skills. Children nowadays are lacking the skills to question in person when they could easily gather that information with a single click on digital platforms (Zhou and Yadav, 2017, pp. 1523-1545). This would curb them from exploiting the different Cadbury products and their varieties. So rather than buying what they desire, they would buy what they easily find. These issues could be avoided and the desires of the target community can be met through e-commerce because they are given a catalog of products present. Secondly, social issues such as discrimination because of their race or gender, or disability could be avoided by purchasing their favorite chocolates through their mobile phones. Finally, the spread of coronavirus. Parents would be so concerned about sending their children outside due to the spread of such a harmful virus and this would distance the children and their love for chocolates. The e-commerce site of Cadbury could eschew such possibilities.

  • Ways to approach:

The customization of the e-commerce site according to the search of the children. For instance, if the children are a lover of caramel products, then the site must suggest all the products have caramel in them. Next, since we are dealing with children the tone of amicability is very crucial in alluring the target community in buying our services. Finally, they must assure that the service would be available 24/7, in case of any queries and suggestions. So, customization, amicability, availability are key elements in approaching the target market.

  • When is the right time?

Except at school hours, children would require a bite from their favorite chocolate. However, the service would be peaked at the times of any festivals such as Halloween, or Christmas, or New year (Whalen et al., 2017, pp. 227-235).

The service of e-commerce in the Cadbury industry would provide a combination of symbolic, functional, and experiential positioning in the market (Rodriguez-Diaz et al., 2018, p. 78). Since Cadbury has been one of the oldest and top chocolate brands in the world consuming a Cadbury product would be luxurious. Similarly, since the issue of shutting the traditional retail shops down, the e-commerce site would genuinely benefit the consumer to a greater extent. And finally, chocolates are always emotionally tied to us, and purchasing them with ease and convenience will be an added incentive.

Part 4: Service marketing mix elements

Since the report is focused on the new service for an existing company Cadbury, let us discuss the service marketing mix elements. In general, the marketing mix for service contains seven elements or seven Ps – product, price, place, promotion, process, physical evidence, and people. Of these elements, this report will discuss elaborately the 3 Ps – process, physical evidence, and people since these are the thing that will be under the control of the company. The marketing mix for the services market comprises of two components – one must be to delineate the offering into its sub-mixes and then unite the sub-mixes to the final marketing mix. These two are correlated firmly such that without one, the decisions cannot be made.

  • Process

While implementing a new service to the company, it must be analyzed whether the chain of activities involved to effectively fulfill the objective of the service is standardized and customized. The process needs to be careful in not losing the standard or the quality of the brand and its product. E-commerce bolsters the notion that the product would be delivered to the customers with convenience. Providing the product directly from Cadbury will affirm the authenticity of the product and would curtail any possibilities of being delivered a fake Cadbury product or in worst cases, expired ones (Stengel et al., 2021, pp. 531-535). Also, the process of delivering as well as purchasing could be customized according to the needs of the customers. For instance, if a consumer needs his chocolate to be delivered to a particular address at a particular date for celebrating some special occasions, it could easily be done by e-commerce sites’ customization option.

It is also important for making the process simple to not bore the consumers purchasing online. This could be achieved by directly suggesting the product they are in most need of so that the time they spent on the site would be less. Lesser they spend on searching, the more they would come again to visit the catalog. Again, customization of the site according to the consumer’s search history and requirement will be conducive to achieving the aforementioned task. The primary objective of the Cadbury e-commerce site would be to mitigate the procedure of purchasing by never compromising the quality of the product to be delivered to the customer at the end.

  • Physical evidence

In Cadbury e-commerce, the tangible elements will be only during the delivery process. So, Cadbury got only one source of tangible component that could physically interact with the customers which are its delivering service. The company underscores its customer reverence by providing an exceptional delivery service that never leaves room for the consumers to find the faults. The triumph of the service extensively depends on the way the delivery person interacts with the customers because they are the direct element with which the consumers could judge the service provided by the company. If the consumer finds any fault or is disappointed with the delivery compared to the services provided by Cadbury’s competitors then Cadbury could lose some of its consumer population. So, the physical evidence of the service is very crucial in determining the outcomes of the service to be either favorable or unpropitious. So, the delivering person will be trained with decent communication skills, amicable social skills, and time management skills to surpass the expectations of the consumer community. Other servicescapes would be the impression the delivering person engenders while delivering the order with his or her neat appearance and hospitality. Along with this, the packaging of the order is the next thing that acts as a deciding factor for the company (Escursell, Llorach-Massana, and Roncero, 2021).

  • People

Human involvement in the service is a key element for determining the potency of the service. It can range from the service provider to the customer. Whoever influences the service provided will come under this category. Customer involvement has been crucial in developing the services to a higher efficiency rate. The higher the customer involvement, the higher are the chances for the company to become a customer-oriented organization (Yu and Sangiorgi, 2017, pp. 40-58). Being such an organization, Cadbury will get ideas for producing new products and services that are required by the customers. This way, Cadbury could gain customer loyalty. Another important human aspect would be the employee behavior towards their customers. The attitude and behavior of the employees towards the consumer when they approach the e-commerce customer service with a query or suggestion, then the employee should behave with harmony and must try every possibility, else there is a possibility of losing the customers. To eschew such deleterious ramifications, Cadbury will provide special education to its employees about effective customer services and the importance of interpersonal skills in developing the services provided by the company. Also, Cadbury must concentrate on providing some training on technical skills required to handle the e-commerce site and the customers approaching through digital platforms (Rodriguez and Walters, 2017, pp. 206-212).

Part 5: A discussion of implementation issues

Since e-commerce is a new addition in the multitudes of the work to be handled by the employees of Cadbury, the process of implementing e-commerce in Cadbury would be a taxing process for employees. The work ethics and routine followed thus far must be altered to incorporate new services inside the working community. The e-commerce implementation would require a new department with fresh minds, this novel addition of employee count would engender the conflict inside the working community (Kurniawaty, Ramly, and Ramlawati, 2019, pp. 877-886). Also, the implementation of new services will engender the notion that there would be an intention of dismissing existing employees. To avoid any such issues, the organization must explicitly provide the details and the importance of such service incorporation in the company and how beneficial this e-commerce service would be in expanding the company further. The basic motto of selling the product you produce must be passed on inside the workplace with the help of internal marketing. Since e-commerce is a new business strategy that requires a lot of human capital and expertise, Cadbury must start training sessions for its employees in getting accustomed to the technology and services. Cadbury must plan on spending a considerable amount of capital on its human resources for getting constructive with the new service. There will also be a great need for employees with computer skills, and digital marketing to effectively develop an e-commerce site for Cadbury.

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