Wednesday, March 30, 2011

Tuesday 3-22-11

This morning we woke up an took the train to Birmingham. The train ride was really smooth and I was able to get some rest (Kyle was too!)

We arrived at Cadbury which was a series of large buildings joined together. We entered into Cadbury World and started the tour. John Cadbury was the founder and he was a Quaker. He was searching for an alternative for alcohol so they used teas and liquid chocolates. They decided to expand into a warehouse and eventually moved into the Bournville area. John's sons Richard and George joined the business and it because a family run business. They found various crushing machines to improve their chocolate making. They also decided to change the way of business by taking care of their employees. They were the first to provide pensions, sick days, etc. and they built a whole community around Cadbury. This gave the company a positive image from various sources, including medical journals, who praised them for the health benefits and for not using as many preservatives. Later they added dairy products to their products. One of the plants receives 500,000 liters of milk every day for production.

The movie stated that they received their most important ingredient, cocoa, from Ghana. Fermentation of the cocoa is the most important step and roasting gives it its unique flavor.

We ate lunch at Cadbury and I bought a lot of gifts for my friends and family. After our self led tour we heard a Cadbury presentation from Colin, an education employee at the factory (see notes).

  • Went from #1 to #2 in confectionary ranking
  • Kraft tried to merge with them but the offer wasn't great so they came back with another offer
  • Merged with Kraft for $19 billion which transformed them into the #1 confectionary company
  • Merger is still in the talks because the House of Commons doesn't want any redundancies
  • Negative media experience because the Kraft CEO won't come to Britain
  • Sales of 5 million pounds
  • Want brand loyalty
  • 187 years open==> open up trust in customers
  • Chocolates, gum, candy
  • Spent a lot of their time building up their reputation
  • Corporate social responsibility is huge
  • Religion influenced production
  • They NEED growth in order to survive
  • Have over 160 brands, including Trident gum
  • Work with fair trade--if you're working with a developing country, you can sign this agreement so that they get paid fairly
  • Product placement: at first they couldn't do it on TV but now they can   ex: Coca Cola cups on The X Factor judge's tables
  • Unique selling point (USP)--they use full cream milk in products, not powder
  • Target markets are very important to them
  • Spend a lot on market research because it builds market share, targets more effectively, new opportunities, anticipates changing needs, etc.
  • Big seasons are Christmas and Easter
  • Market map: look for gaps in the market
  • Reputation is EVERYTHING
  • "Cadbury chocolates must be within arm's reach of every customer"--> now in vending machines, malls, etc.
  • Hot zones--> optimum choice for a consumer; look at eye level, right when you walk in, at the very end of the aisle
  • KISS motto: Keep It Simple Stupid
  • Need iconic image in order to be remembered

I really enjoyed his presentation and hearing his opinions. Kraft recently merged with Cadbury but there's a lot of issues with the merger. Kraft executives had to appear in front of the House of Commons and were asked if workers were going to be laid off. They weren't able to answer and basically the English government is going to keep their eye on this merger. I thought it was really interesting that the Kraft CEO, Irene, refuses to come to England. In my opinion, I think this is a stupid move. There's obviously a lot of controversy surrounding this merger and I feel like in order to smooth things over the Kraft CEO needs to watch her actions. Otherwise Cadbury will be hurt BUT so will Kraft foods.

I really enjoyed hearing about the brand loyalty surrounding Cadbury. They had been building up their reputation for the past 187 years and customers trust the quality of the products. I really enjoyed the video clip about their corporate responsibility work. They have given money to orphanages, after school programs, and dentistry programs all over the world.

I liked hearing about the unique selling points of the company. One is the fact that they use full cream in their products instead of powder. They have also worked especially hard to find the target market for each of their products. This gives them a competitive advantage. They do marketing research in order to figure out the changing needs of the customers and any gaps that they can fill in. They decided that cocoa products (aka Cadbury chocolate) needs to be within arm's reach of the customers. They do this by placing items in "hot zones" and advertising and distributing at various soccer stadiums. They're the official sponsor of the 2012 London Olympics and created a spots vs. stripes campaign to get everyone active during the Olympics. They're doing a lot to maintain their reputation and find new markets to enter.

He also talked about the future of Cadbury. They're looking into GLAD advertising, which is an application on your mobile device which can read your emotions and then send you different deals. Cadbury is also working on piggyback strategies with Coca-Cola. This means that anywhere where Coca-Cola is sold, so is Cadbury chocolates. The business presentation was definitely my favorite part of the day. I could really see how important a company's reputation is to the product. It also seems like companies in England care more about the quality of their products than American companies do. It seems like American companies just want to mass produce in order to make money instead of really focusing on the quality and uniqueness of their products. It was an amazing day and I really enjoyed hearing about Colin' experience and opinions at Cadbury.

After the Cadbury visit, we decided to walk around Birmingham and go see the town hall. We walked through a lot of different buildings and along the river canals. We tried to get a boat ride but they were closing down. We decided to eat dinner at The Malt House and oh boy oh boy was that an experience. We decided to eat on the top patio and order food inside. The bartender refused to serve me food at the bar and he was being very rude to our group. He probably just thought that we were a group of stupid Americans. We decided to go elsewhere for dinner. We finally caught a bite to eat and then hopped on to our evening train. They kept switching the station every few minutes which was aggregating but we finally got onto the right train and headed back to London.

Til next time!


1 comment:

  1. I forgot my camera that day so I will post other people's pictures of the factory at a later date!