There are multiple issues facing Rogers’ Chocolates. Rogers’ has a dated value proposition. In order to expand they need to compromise the history behind the brand. The service tactics and packaging is old fashioned. The need for a different look was further backed by a consultant hired by Rogers’. Their current traditions may be well received in Victoria but they aren’t working to fully expand markets. Rogers’ brand image was tarnished due to the import of raw materials from West Africa. West Africa was faced with issues of forced labor and child labor used in the production of cocoa beans.
In Victoria, matters concerning the social and community environment were important to consumers. This poor brand image had forced some consumers to switch brands. Although one cannot make every consumer happy, it is best to keep an appealing imagine in the media. The company had issues keeping track of demand, supply and the production of chocolate on an annual basis. This created issues with inventory. Production was also slowed, due to the daily setup and equipment. Production was one shift daily and it was very labor intensive.
Rogers’ also had issues with demand forecasting as it was difficult to track due to seasonality of sales. Rogers’ product had a shelf life of 6 months but smaller wholesalers were selling expired products, another area where the supply to wholesalers should be tracked. Another key issue with Rogers’ was the market they served. Since Rogers’ relied on serving a niche affluent segment of the market who sought luxury and supreme quality, they lost consumers. Their premium price point scared consumers and wholesale accounts away. The consumers of Rogers’ were also tourists who were steadily declining.
Rogers’ Chocolates was also experiencing the decline in its foreign consumer base, as the ratio of tourists visiting Victoria had declined over the years. Recommendations Rogers’ Chocolates has to target the younger market and update the design of its packaging, for some of the items. They should use flashier tins and wrappers to gear to those consumers outside of Victoria.
However, they should maintain what works for consumers in Victoria. They should take advantage of social media which is less costly as compared to other means of advertising to lure in new consumers. This will boost sales and revenue. They need to increase brand awareness and reach out to a greater number of consumers through electronic or print advertisement. Television advertisement should also be used in a larger scope. They need to communicate to consumers about what they are doing to play their part in the community. Rogers’ should go public on what are they doing to promote themselves in the realm of social responsibility. Rogers’ should tie the community into charity events to create brand awareness.
They need to improve consumers’ thoughts about their brand due to the issues in West Africa. They need to adopt effective public relations avenues as a means of promoting the positive image of the brand. Sam’s Deli needs a clearer vision, better management and more recruitment. They need to decide whether franchising would be a viable and profitable option. Rogers’ should also add a section of Rogers’ chocolates at Sam’s Deli so that the visitors to the restaurant may also purchase the assortment, which could secure new loyal consumers.
They should provide free chocolate samples at Sam’s as a marketing ploy. Rogers’ production needs improvement. They need to establish effective tools to forecast changes in the consumer’s demand of chocolate in the local market, and match the production accordingly to avoid extra expenses and excessive waste. They should consider adding more shifts. This will put further stress on recruiting better workers, however it will make them more efficient. Rogers’ should adopt better opening, closing and cleaning procedures. They should look into the costs behind mechanical production vs hand made.
This can potentially make them more efficient as well. All this should be done without compromising quality. They should consider offering a more price friendly product vs high price point to open the market up to those who aren’t affluent but still will pay for quality chocolates. In their retail stores they should continue creating a positive image of the brand in the mind of the visitors. They should also continue to create strong brand loyalty and continue to market themselves as a unique gift item which can be given to others. Porters Model
Threat of New Entrants The growth rate in the chocolate industry is falling, which makes the threat of new entrants low. However, the traditional manufacturers are moving toward premium chocolate in an effort to maintain significant profit margins. This makes a moderate threat of entrants. They are doing this through market acquisitions or up marketing. There is also a greater profit margin in case of premium chocolate which makes it a more attractive tactic for the new entrants. Bargaining Power of Consumers Consumers have a moderate level of bargaining power.
The loyal Rogers’ consumers dictate the packaging and store experience. Rogers’ has held onto this traditional view for their consumers. Consumers will pay the higher price because they value Rogers’ and will not switch brands. Bargaining Power of Suppliers The suppliers have moderate level of bargaining power. Consumers wanted healthier options but Rogers couldn’t gain any support from suppliers to be a part of its organic or fair trade plan of action. Threat of Substitute products and services The substitute products can be any other non-premium chocolate bar, chocolate products or candy.
There are many different chocolate products available and most are an easy to find. There are about 20 options at close reach in the checkout line at the grocery store. Chocolate is readily available and this is a large threat. Most will take advantage of that availability. There are also other services available; there may be smaller private chocolatier companies that play a role in substitute products. Intensity of Rivalry among competitors in an industry The chocolate industry has a high level of competitive rivalry.
There were many organizations manufacturing and selling high quality premium chocolate including Godiva, Bernard, Callebert, Lindt and Purdy’s. The competitors were making efforts to gain a larger market share through offering high quality products, but they had more affordable prices in comparison to Rogers’. SWOT Analysis Rogers’ Strengths •High pre-Christmas sales. •Premium ice cream. •Loyal consumers. •High quality, luxurious brand image. •Market penetration through various outlets retail, wholesale, online mail and phone orders.
Sam’s Deli playing a significant role in the sales and profitability of the chocolate sold by the company. •The retail store run by the company was capable of creating a positive image of the brand. •Viral marketing more effectively. •Internet as a source of marketing, with high quality websites that were easy to use. Rogers’ Weaknesses •The company had issues in case of keeping a record of demand, supply and production of chocolate on an annual basis, which inevitably resulted in inventory issues. •Poor community outreach. •Inefficient daily processes. Opportunities
Rogers’ has the option to penetrate more locations outside of Victoria with better media coverage and advertising. •The can produce more if they streamline their production process, which will avoid inventory shortages. •Rogers’ can look into acquisitions or up marketing also to better position themselves in the market. Threats •Godiva, Bernard, Callebert, Lindt and Purdy’s. •Competitors were making efforts to gain a larger market share through offering high quality products, but they had more affordable prices. •Substitute products •Multiple chocolate manufacturers not listed, ie Nestle, Hershey etc.