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Prinmkt Hershey Final
Prinmkt Hershey Final
Executive Summary.....................................................................................................................1
1.0 Introduction............................................................................................................................1
4. Micro Analysis..........................................................................................................................4
4.2 Customers............................................................................................................................ 5
4.3 Suppliers.............................................................................................................................. 5
5. Competitive analysis................................................................................................................6
6. SWOT....................................................................................................................................... 9
References:................................................................................................................................. 11
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Executive Summary
This report analyzes Hershey's role in the US confectionery and snack market, aiming to
identify key focus areas for the upcoming fiscal year. Using a PEST framework, we
examine external factors such as the economic landscape and health-conscious consumer
trends influencing Hershey's strategies. Internally, we explore Hershey's success factors
through Kotler's framework, considering product innovation and supply chain
efficiencies. The competitive landscape, including rivals like Mars and Mondelez, is
highlighted through a SWOT analysis, leading to strategic recommendations. These
include investments in R&D for innovative products, emphasis on health-conscious
choices, and leveraging digital channels for marketing and sales.
1.0 Introduction
This marketing assessment focuses on Hershey, a leading player in the US confectionery
and snack market. Our examination centers on Hershey's unique position in the dynamic
realm of confectionery, encompassing a diverse range of products from chocolates to
snacks. Throughout this document, a variety of theories, models, and frameworks will be
utilized to uncover the intricate factors that shape and direct Hershey's operations within
the continually evolving landscape of the United States' confectionery and snack sector.
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accessible treats is complemented by its dedication to community engagement and
sustainable practices, reflecting Hershey's enduring influence and significance in the US
confectionery landscape.
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global political dynamics is vital for Hershey to mitigate risks and maintain
competitiveness in the interconnected global market.
Inflation is another economic factor that bears relevance to Hershey's business. Inflation
rates can impact production costs, including raw materials and distribution expenses. For
example, rising inflation may result in increased prices for commodities like cocoa, a key
ingredient for Hershey's products. Monitoring and adapting to inflation trends are critical
for Hershey to maintain profit margins and competitiveness. In 2022, the United States
experienced an inflation rate of 6.5%, impacting various industries, including food and
beverage (US Inflation Calculator, 2022).
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demand for sustainably sourced products, aligning with Hershey's commitment to
sustainability.
4. Micro Analysis
4.1 The company
In the micro analysis of Hershey, the company exhibits a robust position in the
confectionery industry. Hershey's annual revenue for the fiscal year 2021 was reported at
$8.8 billion, showcasing the company's substantial market presence (The Hershey
Company Annual Report, 2022). Hershey's mission centers on providing delightful
moments to consumers through the creation of high-quality, indulgent treats at accessible
prices. The company's commitment to this mission is reflected in its diversified product
portfolio, including iconic chocolate bars, candies, and snacks, catering to a broad
consumer base. Hershey's vision emphasizes a focus on global growth and expansion,
leveraging innovation and strategic acquisitions. The company's strategic initiatives, such
as the Cocoa for Good program, underscore Hershey's dedication to sustainability and
ethical sourcing in its supply chain (The Hershey Company, 2022). Hershey's consistent
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financial performance, coupled with a mission and vision aligned with evolving
consumer values, positions the company as a key player in the confectionery market,
poised for sustained growth and adaptation to industry trends.
4.2 Customers
Hershey's customer persona encompasses a diverse demographic, catering to both young
and mature consumers with a range of products. According to market research, Hershey
holds a substantial market share in the US chocolate confectionery segment, amounting
to approximately 25% in 2021 (Statista, 2023c). The customer avatar for Hershey spans
various preferences, including those seeking classic indulgences, health-conscious
individuals gravitating towards better-for-you options, and environmentally conscious
consumers interested in sustainably sourced products. The company's strategic response
to evolving consumer needs is evident in its product innovation, with an emphasis on
introducing healthier alternatives and sustainable practices. This customer-centric
approach aligns with contemporary market trends, contributing to Hershey's resilience
and prominence in the confectionery industry. The diversified customer persona
underscores Hershey's adaptability to changing consumer preferences and positions the
company for continued success in capturing a broad market share.
4.3 Suppliers
Hershey collaborates with a network of suppliers globally to source key ingredients, with
cocoa being a primary focus. The Cocoa for Good program, launched by Hershey,
reflects the company's commitment to sustainable and responsible sourcing practices
(The Hershey Company, 2022). This initiative aims to address social and environmental
issues within the cocoa supply chain, showcasing Hershey's dedication to ethical supplier
relationships. As of 2022, Hershey reported working directly with over 37,000 cocoa
farmers globally to enhance productivity and promote sustainable farming practices (The
Hershey Company Annual Report, 2022). The company's emphasis on supplier diversity
and responsible sourcing aligns with evolving consumer expectations for ethical and
transparent business practices. This strategic approach to supplier relationships
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contributes to Hershey's ability to maintain a consistent supply of high-quality ingredients
while addressing broader industry challenges related to sustainability and social
responsibility.
5. Competitive analysis
5.1 Perceptual Map
On a perceptual map, Hershey strategically positions itself by maintaining a delicate
balance between quality and price. When comparing Hershey to Mars, both brands are
esteemed for delivering dependable quality in their chocolate products. However,
Hershey tends to be perceived as more affordably priced than Mars, presenting an
enticing option for consumers seeking both quality and cost-effectiveness. Ferrero,
renowned for its premium offerings such as Ferrero Rocher, often adopts a higher price
point, targeting consumers seeking a more luxurious chocolate experience. In
comparison, Hershey appeals to a broader demographic by offering a balanced
combination of quality and affordability, catering to both discerning and budget-
conscious consumers. This nuanced pricing strategy enables Hershey to maintain a
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favorable position in the confectionery market, capturing a diverse and wide-ranging
consumer base.
Strengths
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Criteria Hershey Mars Ferrero Rocher
Weaknesses
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In conclusion, the competitive analysis of Hershey reveals a strategic positioning that
leverages a delicate balance between quality and affordability. With a diverse range of
iconic chocolates and snacks, Hershey has established a strong brand presence in the
U.S., capturing a significant market share. The company's continual innovation, strategic
partnerships, and a focus on competitive pricing contribute to its success in appealing to a
broad consumer base. While facing competition from global giants like Mars, Hershey's
emphasis on meeting consumer demands for both quality and cost-effectiveness positions
it as a formidable player in the confectionery industry.
6. SWOT
Strengths Weaknesses
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Diverse Product Portfolio: For instance, Perceived as Less Healthy by Some:
the introduction of innovative products According to a survey conducted by Statista,
like Hershey's Gold and Reese's Thins 40% of U.S. consumers reported concerns
reflects Hershey's commitment to staying about the health impact of consuming
relevant in a dynamic market. The ability chocolate since it contains cadmium and lead
to offer a diverse array of products (USA TODAY,2023). This perception may
positions Hershey as a versatile player in impact Hershey's ability to attract health-
the confectionery industry, catering to a conscious consumers who prioritize products
broad spectrum of consumer tastes. perceived as healthier alternatives.
Opportunities Threats
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(Statista, 2023b), Hershey should prioritize seamless online experiences and expedited
delivery services to capture a significant share of this growing market.
References:
1. BrandDirectory. (n.d.). Food & Drink 2023 | The Annual Brand Value Ranking.
Retrieved from https://brandirectory.com/rankings/food/. [2023, December 11].
2. Center for Food Safety and Applied Nutrition (CFSAN), FDA. (2023, January
19). Summary of changes in the 2022 FDA Food Code. Retrieved from
https://www.fda.gov/food/fda-food-code/summary-changes-2022-fda-food-code.
[2023, December 12].
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confectionery-serving-formats-revenue-growth-united-states-us. [2023, December
11].
6. Statista. (2023b, June 27). Offline/online revenue share in the U.S. confectionery
market by channel 2017-2025. Retrieved from
https://www.statista.com/forecasts/1384392/confectionery-market-revenue-share-
by-channel-in-the-us. [2023, December 11].
7. Statista. (2023c). Chocolate market share of U.S. companies 2021. Retrieved from
https://www.statista.com/statistics/238794/market-share-of-the-leading-chocolate-
companies-in-the-us/#:~:text=The%20Hershey%20Company%20was
%20the,Mars%20as%20a%20significant%20competitor. [2023, December 11].
8. Statista. (2023d, September 19). Healthy snacks: market value worldwide 2021-
2030. Retrieved from https://www.statista.com/statistics/1317251/healthy-snacks-
market-value-worldwide/#:~:text=The%20global%20healthy%20snacks
%20market,annually%20between%202022%20and%202030. [2023, December
11].
10. The Hershey Company. (2022). Visible progress: Hershey’s Cocoa for good
strategy. Retrieved from
https://www.thehersheycompany.com/en_us/home/newsroom/blog/going-beyond-
fair-trade-with-hersheys-sustainable-cocoa-strategy.html. [2023, December 11].
11. Trading Economics. (2021). Cocoa - price - chart - historical data - news.
Retrieved from https://tradingeconomics.com/commodity/cocoa. [2023, December
11].
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12. USA TODAY. (2023, October 26). Halloween alert: Test finds many chocolates
contain concerning levels of metals. Retrieved from https://www.usatoday.com.
[2023, December 11].
13. US Inflation Calculator. (2023, December 12). Current US inflation rates: 2000-
2023. Retrieved from https://www.usinflationcalculator.com/inflation/current-
inflation-rates/. [2023, December 12].
14. World Bank. (2022). GDP growth (annual %). Retrieved from
https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG. [2023, December
12].
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