Marketing assignment on: Confectionary sector in Australia

Task 1:

Background of the Industry:In 2010, the sales figure in the confectionary sector in Australia has been accounted to an approximate figure of Australian $2.53 billion (US$1.44 bn). This shows an increase of 7% from the last year. The chocolate products manufactured in Australia has an approximate figure of 60% out of the entire confectionery market, the chocolate products manufactured can be segmented on the various parameters i.e. children’s novelties (7%), blocks (27%), boxed assortments (12%), chocolate bars (43%), and seasonal chocolates (11%). The sugar made confectionery & the chewing gum segment has been accounted to be approximate A$838 million, which comprises of 41% of the total confectionery market.

In Australia the confectionary business is quite biased during the colder months i.e. December as there are many special occasions arising in that particular month such as Christmas, New Year, Easter, Valentines Day, etc.

The confectionery market in Australia is at the maturity phase of its PLC & a long-term growth is expected as the population is growing at an average rate of 2% – 3%. Approximately 85 firms have been manufacturing confectionery in Australia. Whereas, there are various market leaders in the confectionery market which leads the market such as Nestlé Confectionery (22%), Mars Confectionery (18%) & Cadbury Schweppes (36%).

The confectionery products which are being imported have been accounted for A$205 million. This means that the sale of the confectionery products would be approximately A$420 million. The places from where the products were being imported, UK, China, Italy, New Zealand, Belgium, Switzerland & United States.

The confectionery products contribute 43% amongst the Australian snack market. They are the fourth highest consumers for the processed snack foods. On an average, an Australian individual spends approximately Australian $800 pa on the consumption of the confectionery food. It is seen that the Australians like to have wide range of snack food.

The major players in the Australian confectionary food market comprise of Cadbury being the market leader, followed by Nestle, Mars etc.

About the firm:

The Confectionery House refers to one of the manufacturers in Australia which produces various types of cookies, chocolates, sugar coated confectionery.  The main aims of the confectionery house is to manufacture products & packing them in the most attractive packing which is of the highest quality, priced reasonably less as compared to its competitors & is promptly available.

The Confectionery House manufactures chocolates by using the Australian sugar as well as the locally produced milk products, imported cocoa butter substitute and cocoa powder.

Mission & Vision:

The mission & vision of the Confectionery House situated in Australia is to grow steadily in the current market in short span of time by utilizing best of the expertise, skills, and professional staff which comprises of high levels of commitment, integrity, enthusiasm, energy, differentiation.

Objectives:

Their main aim of the Confectionery house is to become the market leaders in manufacturing sugar panned confectionery in the Australian as well as the New Zealand market in a short span of time which would help them in order to expand its business operations all across the world. Competitors:

The competition in the confectionery market prevalent in the Australian market is quite fierce with 85 firms involved in the production of the confectionery items. There are three market leaders in the Australian Market i.e. Cadbury Schweppes Australia Ltd, Nestle Australia Ltd & Mars Confectionery of Australia.

Cadbury Schweppes rule over the confectionery market in Australia. It has an approximate 36% share of entire confectionery market. The Cadbury has been the market leader with its successful launch of the Time Out chocolate bar, Trebor, Yowie & Breakaway.

Nestle Australia Ltd is the next company which dominates the market by contributing 22% market share in the overall Confectionery market. The major production of the chocolate bars by this company includes Kit Kat, Aero, Rollo, Minties, Allens, etc.

The third largest company in the confectionery market in Australia refers to the Mars Confectionery of Australia. It contributes 18% of the entire Australian market. Some of the production by this brand refers to Mars bars, Snickers, Twix, Bounty, Starbursts, etc.

Product Strategy:

Product strategy is one of the elements which would help in designing the marketing strategy. The major product strategy which has been adopted by the Confectionery House is to provide wide range of products to its customers. It manufactures different types of milk shakes in different variants, chocolates, sugar panned confectionery products etc. The type of product strategy which is being used by the confectionery house is by positioning the products by selling the products through its unique selling propagation. The company’s USP refers to manufacturing high quality of products & attractively packing it in order to attract more customers towards it as compared to its competitors.Promotional Methods:

One of the basic promotional methods used by the confectionery house in order to promote its product is to persuade the potential customers to try the products manufactured by this company & be a part of the confectionery house. The bakery entices the customers by its various fragrant tools (sensory cues) which spreads the fragrance for a longer period of time. The other way through which the confectionery house promotes its products is through special events such as Mother’s Day, Valentine’s Day, etc & providing free gift hampers in order to publicize its products.

Pricing Strategy:

Price refers to the second crucial element which would help the confectionery house, Australia in order to attract more number of customers towards it.Distribution Strategy:

The distribution arrangement for the confectionery product in Australia is one of the most extensive. The main retail sites in order to purchase the confectionery products are the supermarkets, department stores, convenience stores, gas stations, milk bars, & the various fast food joints.

The two extensive channels of distribution which is prevalent amongst the Australian confectionery market refer to Grocery & Traditional. In case of the confectionery house, the grocery channels are majorly used in order to sell the products at the expense of the route.

The grocery channels of distribution refers to the most direct method through which the products would be send out from the warehouse to the sellers delivery centre.

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