Marketing Analysis Of Barry Callebaut: Sustainability Strategy And SWOT Analysis

Marketing Mix of Barry Callebaut

Discuss about the Sustainable Marketing Management of Barry Callebaut.

Time has experienced different phases of marketing strategy and tactics. Out of which sustainability is the major factor that has developed marketing strategy over the time. Now, the sustainability in marketing process and strategy has become the major focus of attention for most of the firms. Adopting sustainability marketing strategies provides the organization a way to respond to requests for the products and services which preserve the limited resources of world. Marketing with sustainability assists in strengthening the brand, building trust and encouraging loyalty among customers.

The below-report includes the marketing analysis of Barry Callebaut Company that is a leading manufacturer of high quality chocolates and other cocoa products. This report analyzes the marketing mix of Barry Callebaut Group to attain the sustainability and enhance brand image over its competitors. The marketing mix of the firm is explained by incorporating different strategies like product, pricing, distribution and promotion strategy. Moreover, it explains the SWOT analysis of Barry Callebaut against its competing brands i.e. Hershey’s, Cargill, Mondelez etc. This organization is using some specific sustainability principles to become more sustainable in the chocolate industry. It can enhance its operations by implementing other sustainability principles.

Barry Callebaut is one of the largest cocoa grinders and manufacturers with average yearly production of 1.7 million tonnes of cocoa. The organization was established in the year 1996 via merger of Belgian company Callebaut and French company Cacao Barry. Currently, it is based in Zurich, Switzerland and operates its business in more than 30 nations. This organization was created by Klaus Johann Jacobs. Its major customers include national and multinational customer goods manufacturers and users of chocolates like pastry chefs, bakeries, chocolatiers and caterers. It has a global network with different production sites in Africa, Europe, South and North America and Asia Pacific (Barry Callebaut, 2018). Barry Callebaut is committed to manufacture sustainable chocolate to assist the future supplies of cocoa and enhance livelihoods of farmers.

Marketing includes various marketing strategies which are implemented by an organization to attract customers towards its products. With the passage of time, there is a requirement to consider the sustainability to develop strategy that means that it has to implement sustainability in marketing mix (Leonidou, Katsikeas, and Morgan, 2012). Marketing mix of Barry Callebut is given below:

Barry Callebaut is offering various chocolates and other cocoa products under different brands like Carma, Callebut, Van Leer, Luijckx, Chocolate Masters, Houten, Siaco, Le Royal etc. It has positioned itself as high quality cocoa and chocolate provider to its targeted audiences (Obermiller, Burke and Atwood, 2008). The major products of this firm include chocolates, fillings, compounds, nuts, decorations and inclusions for desserts, ice-creams and confectionaries. Considering the sustainability, the company is offering solution to its customers related to taste and quality. It is focused on packaging of chocolates to practice sustainable marketing. It has substituted its papers with the eco-friendly packaging which is bio-degradable ingredients (Afoakwa, 2008). To process environmental sustainability, it is decreasing the wastage of landfills and packaging. They are becoming greener and offering safety measures to staff.

Product Strategy

Barry Callebaut is one of the premium chocolate brands that offer various products and services. The prices of company’s products are changing with the fluctuations in the costs of raw materials like sugar, milk and cocoa. It targets higher and middle income people for its chocolates and prices vary from 12$ to 65$ as per their sizes and types (Hultman, Katsikeas, and Robson, 2011). To become more sustainable, this organization will introduce candies and other products for lower prices. In the near future, firm is planning to provide a combination of excellent quality chocolates at affordable prices. By this, the company will be able to establish a sustainable image among targeted population.

Distribution strategy assists Barry Callebaut Organization to approach a large customer base through extensive distribution network. The customers are able to purchase the chocolates and other cocoa products from shopping malls, grocery stores, departmental stores and supermarkets etc. customer can buy the chocolates online from e-commerce sites (Jones, et al, 2008). It is making sustainable efforts by enhancing its supply chain. It is planning to exclude child labor from its supply chain process. Moreover, it is focusing on offering products online as physical offering can increase the environmental pollution due to transportation emission (de Andrade Silva, et al, 2017). It makes sure that its operations do not harm the natural resources and environment. It plays a main role to achieve sustainability for Barry Callebaut.

Promotion strategy plays an important role in the marketing plan of a company. Barry Callebaut is adopting effective promotion strategies to attract a large population towards its chocolate products. For this, it uses various modes like print media, online media, TV ads, billboards etc. It is using effective taglines that affect the people’s perception positively. The company prefers to practice the modes so that it can communicate its brand messages to a large population. To establish a viable brand image, organization is using various sustainable efforts and sustainable marketing so that it can entice more customers (Kavoura and Stavrianea, 2014). It is reducing the usage of paper for advertisement and preferring to use online and broadcasting mode.

Thus, Barry Callebaut is actively engaged in socially responsible and sustainable marketing by the execution of above strategies under its marketing mix.

SWOT Analysis is the framework which is practiced by a company to evaluate the internal and external forces like strengths, weaknesses, opportunities and threats. It is one of the major efforts which are made by an organization to become sustainable in the industry. The below-given table compares different forces of Barry Callebaut with its major competitors like Hershey’s, Cargill and Modelez. It shows how this firm positions itself against its competitors. SWOT comparison table is given below:

Basis for Comparison	Barry Callebaut	Hershey’s	Cargill	Mondelez
Strengths	·   It is one of the major manufacturers of high quality cocoa products and chocolates with the employee strength of 9000. ·   The company is practicing sustainability in product development like tooth friendly chocolates, chocolates with antioxidants and probiotic chocolates. ·   Engaged in various CSR activities such as food safety, environment protection, cocoa plantation support, children protection etc. ·   Sustainable cocoa is the major part of its long-term strategy. ·   It has established chocolate academies worldwide for training artisans, chefs, caterers and bakers (Afoakwa, 2010).	·  Hershey’s is one of the largest chocolate manufacturers worldwide. ·  It is making different humanity and sustainability efforts. ·  Huge brand portfolio of company assists it in becoming more sustainable (Over 50 brands). ·  It is able to establish a strong public and social image via The Milton Hershey School and its school for orphan kids.	·   It is the largest private sector firm of America. ·   It has more experience in chocolate production than Barry Callebaut and Hershey’s as it was founded in 1865. ·   It has more employees than Barry Callebaut and Hershey’s i.e. 142,000 employees.   ·   Engaged in sustainability and CSR activities to provide return to the shareholders.	·   Mondelez has great market dominance with its 53 labels. ·   It offers more varieties of products than Barry Callebaut like snacks, cookies and chocolates. ·   It is making large investment in research and development process. ·   It has focus on the distribution in emerging nations.
Weaknesses	·   The company has limited brand presence among people than its competitors like Hershey’s and Mondelez. ·   Strong competition from big industry competitors like Hershey’s, Nestle, Cadbury etc. ·   The above factor leads it to limited market share.	·   As of 2014, it has long term debt of 2.4 billion that affects its brand image among people. ·   Huge spending on advertisement and promotion. ·   The prices of Hershey’s chocolates are higher than its competitors (Gutiérrez, 2017).	·    It is facing issues because of higher switching of brands. ·   Negative publicity due violation of human rights, harms to environment and contamination.	·   Unequal implementation of business processes. ·   It has limited brand presence among population. ·   There is decrease in the total revenues because of new entrants in this industry.
Opportunities	·   It can increase its brand presence by establishing in-house confectionary production. ·   Adoption of more research and innovation ·   Strategic collaboration with competitors such as Hershey’s, Cadbury and Cargill.	·    It is not enough to operate business in 60 countries. So, it has opportunities to expand operations in emerging markets. ·    Product diversification: considering health concern among people, it can introduce chocolate with healthy elements and sugar free. ·    It can become more Innovative and sustainable like Barry Callebaut.	·   Business expansion in rural regions. ·   Aggressive marketing practices ·   It can acquire other established firms. ·   It can invest in sustainability and CSR activities to regain its image.	·   Like Barry Callebut, it can expand its operations in developing nations. ·   It can save the funds by increasing its efficiency and controlling expenses on overheads. ·   It has the opportunity to spend money on sustainable development.
Threats	·   One of the major threats is the competition from local rival. ·   There is an increase in the cost of raw materials like milk, cocoa and sugar. ·   The people are becoming very conscious towards health that resists attaining sustainability.	·   Intense rivalry: Like Barry Callebaut, Hershey’s is facing intense competition from other players such as Nestle, Cadbury, Cargill, M&M and Galaxy etc. ·   People are becoming very concerned towards their health (Blockeel, et al, 2016). ·   Higher usage of cocoa and procurement of cocoa’s right quantity is major blockage for Hershey’s production.	·   Economic instability in country is the biggest threat to the company. ·   Fluctuation in the costs of raw materials (Ramli, 2013). ·   It is confronting rivalry in all market segments (Saltini and Akkerman, 2012).	·   Competition from low cost chocolate manufacturers. ·   Increase in the cost of raw materials.

The above analysis indicates that Barry Callebut has place itself as one of the biggest players in chocolate industry. However, it has failed to maintain its brand presence in the industry. It is making several efforts for sustainable marketing and sustainability that is the actual reason behind its identifiable growth (Kumara, et al, 2012). 

Pricing Strategy

The above chart indicates that Barry Callebaut is offering high quality chocolates than its competitors. The company is offering different cocoa products on premium prices. It is highly sustainable as it is actively engaged in sustainability and CSR activities (Gordon, Carrigan, and Hastings, 2011). The company will be able to attain a viable and sustainable development in the industry.

Sustainable marketing principles are the marketing efforts which are made by a company to support the long run performance of the system. It fulfills the demands and needs of customers while increasing their capabilities. Barry Callebaut is adopting several sustainable marketing principles to entice more population towards its cocoa products (Gopaldas, 2015). It is very important for the organization to become sustainable as people are very much concerned towards society and environment. This is the reason that Barry Callebaut is engaged in CSR and sustainability activities.

Under sustainable marketing principles, Barry Callebaut has adopted societal marketing to entice the people towards its cocoa products. Societal marketing is a concept of marketing which holds that a firm should make its marketing decisions not only by looking at the wants of customers and needs of a company but also long term interests of society. Barry Callebaut is conducting a marketing research to recognize demands and preferences of people (de Melo, Bolini, and Efraim, 2009). Considering them, it makes marketing and product decisions for the long term benefits of society. While developing its marketing efforts, organizations considers that people always change their tastes and preferences for the chocolate products.

Considering the needs and demands of people, it is planning to offer 100% sustainable ingredients in all of its products. It is very much concerned about the cocoa farmers. By the implementation of CocoaAction strategy, the company commits to track the farmer’s poverty by strengthening farmers to earn better income via training, financing, coaching and planting material. The needs and preferences of customers enable the company to launch more product categories like healthy and sugar free chocolates (Carroll and Shabana, 2010). It promotes its products on social media and television because people are actively using the social media platforms and it reduces the wastage of paper. Thus, the company is adopting societal marketing after understanding the needs and preferences of customers.

Innovation marketing is one of the major principles which needs that an organization seeks real product and improvements in marketing. The organization which overlooks better and new ways to perform the activities will lose the customers to competitors which have found better and more innovative way. Looking at the changing market trends and customers’ needs, Barry Callbaut is making a huge investment in the research and innovation. It has developed a strong research and development process to consider the needs and demands of customers. It has made innovation in its product development process such as probiotic chocolates, tooth friendly chocolates and chocolates with anti-oxidants (Cronin, et al, 2011). This principle of sustainable marketing assists the company in attracting more customers towards its chocolates and other cocoa products.

Distribution Strategy

However, Barry Callebaut Company has adopted effective principles to stay competitive in today’s business environment but still there is a scope of improvement. So company needs to adopt some other principles for sustainable growth in the market. The company can adopt customer relationship management that can help the organization in developing good relationships with its customers. It can assist the Barry Callebaut to retain them for a long time (Fiore, et al, 2016). After selling the chocolate, the company can take the feedback of customers so it can know about their response towards products. It should contact with the customers on their anniversaries and birthdays. In addition to this, it needs to emphasize on value proposition and to place itself as social responsible brand among targeted population. It can develop a positioning statement that shows higher quality of Barry Callebaut company’s chocolates and cocoa products (Weinstein and Pohlman, 2015).

Conclusion

Thus, it is hereby concluded that Barry Callebaut is one of the leading manufacturer of chocolates and other cocoa products. To become more sustainable, the company has adopted effective marketing strategies and sustainable principles. The report has included the marketing strategies of Barry Callebaut which assist it in gaining more competitive advantage over its competitors. The analysis concludes that this organization can practice its strengths to overcome it weaknesses and opportunities to overcome threats. By the use of effective sustainability principles, it is able to establish a better brand image among population. Thus, the company has developed its image as a leading manufacturer in chocolate industry.

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