CONTENT PAGE
Section Page
No.
Group
Task
Task 3:
Introduction 3
3.1: Use appropriate marketing technique to
ascertain growth opportunities in the market 4
3.2:
Identify as to how the organization plans its marketing strategy option in a
market 6
3.3: Discuss
appropriate strategic marketing objectives for the market chosen by the
organization 7
Task 4:
4.1: How
the organization responded to the changes to the external environment on a
given marketing strategy 9
4.2: An internal
analysis of Silver spoon 10
4.3:
Propose strategic marketing response to key emerging themes in a marketing
strategy for the organization 12
Conclusion 13
Bibliography 14
Introduction
More
people are becoming health conscious therefore customers are now reducing their
sugar intake, Silver spoon has listen to the customer’s needs by producing more
healthy products with less calories.
Silver
spoon is a part of the associated British Foods (ABF); ABF is a diversified
international food, ingredients and retail group with an annual sales volume of
£11 billion with customers in 46 countries across the globe. ABF currently has
102,000 employees across 46 countries (ABF, 2012) , with 13,000 of
these employees working directly with the Silver Spoon brand.
ABF
corporate objective is to achieve strong market leadership position,
“ethically” by listening to the customer’s needs and wants, bring them products
at an affordable cost.
Since
the launching of the Silver Spoon brand in 1972 the brand has seen continuous
success and has become the UK favourite choice. The silver spoon brand loyalty
has grown throughout Europe, Africa and Asia, the company is known for having fewer
calories in their products.
The
silver Spoon products is in almost everything from the drinks we buy to the
cake we eat, there are a lot of companies operating through the silver spoon
brands these include, Allison, Askeys, Billinton’s, and crusha.
This report will discuss the way
Silver Spoon has responded to the changes in the market environment and their
link with Associate British Foods (ABF).
3.1
Use appropriate marketing technique to ascertain growth opportunities in the
market
Silver spoon is a
leader supplier of sugar and sweetener in UK market. Demand and consumption of
sugar is falling in UK ,consumption of
sugar in 1995 was 2.396 million ton but in 2000 I went down to
2.337 million ton,( ED&F Man June 2001 ).Lower
consumption is causing UK Sugar sales in
long term decline falling by 3% a year for last one decade. Because of crisis
in sugar market Silver spoon company came under investor pressure to divest
their sugar division and concentrate on food ingredients that forced Silver spoon to make a significant addition to its product
portfolio and it launched a multiple products in each of the following
categories : sugars and syrup for cooking , low calorie sugars and sweeteners ,
ice cream cornets and topping sauces ,milkshakes ,flour and cake craft products
for baking and decorating as a result it benefited from the strong sales of
Silver spoon sugar and Allison flour ranges. Silver spoon products are
available in different packaging size to meet business and individual customer
needs in a segment .Silver spoon has created its packaging from 500 g through
to 25 kg for white sugar.
Marketing objectives of
Silver spoon is of course to obtain growth, increase sales and maintain market
share. To accelerate growth it has to adopt marketing strategy and that is a
cost leadership through investing in factories in china and Africa that allows
getting sugar in low cost. Similarly another strategy is competitive advantage
through introduction of superior technology and bulk buying capacity of firm
that is benefiting ABF to increase profit.
Because of health
concern people were more interested to use organic and low calorie sugar, to
target these market audience Silver spoon went organic and did first brand
acquisition with Sucron, a low calorie sweetener .In 2001 it also acquired
Crusha leading UK milkshake mix brand.
According to Tony Lucas marketing director of
Silver spoon, “there was scope for the new product to increase the UK sweetener
market by 18% over the 2 years adding 10 million to sale”. More than a quarter
of all British household currently buy artificial sweeteners. This figure gave
Silver spoon an opportunity to grow with innovation. As a part of marketing techniques Silver
spoon launched the first calorie free natural sugar substitute sweetener
product in the UK, called Truvia .Competitors such as Splenda and Canderal
which use synthetic sugar substitutes but making Truvia natural sweetener,
Silver spoon has differentiated from these sweetener competitors in a bid to
take a major share of the 50 million pound UK sweetener market.
It has targeted its
products for different market segments first is foodservice industry that
includes hotels, restaurant, bakery and product are designed to meet the needs
of food service industry like sugars and syrup ,flour cake craft decorating
sauces etc. And next is individual customer segment, for them the size of
packaging, price and products range are vary because the needs are different in
this segment. Positioning and promotion can be done through making accessible
all the products in market, promotions like advertisement and reaching to
customer directly via website. These are all activities stimulating growth of
Silver spoon.
3.2: Identify as to how
the organization plans it’s marketing strategy option in a market
In
order to be an efficient and effective business, Silver Spoon seeks out target
customer market of different groups. If we are talking about target they are
making products for meeting the needs of the customers. Silver spoon has a
highly motivated marketing team to fulfil the requirements of the company.
Porter argues that competitive strategy means
“taking offensive and defensive actions to create a defendable position in an
industry, to cope with competitive forces and thereby yield a superior return for
the firm”. (tutor2u.net)
Following
are some of their options for market plan:-
Cost Leadership Strategy
Silver
spoon is low cost producer industry which makes quality products on a
reasonable price so that it could be possible for the people of different
classes to buy and enjoy the products. In this way they can maintain customers
and beat the rivals. Silver spoon can beat cost leadership just because of some
of these qualities: (silverspoonpeople.co.uk, 2012)
They
have very good distribution channels
They
have expert manufacturing department to fulfil the requirements of orders and
they use latest technology to reduce the costs and to enhance the productivity. (quickmba.com,
2010)
Differentiation strategy
A
differentiation plays a great role in the success of silver spoon just because
they have a strong creative product team they can make innovative products for
these day’s customers. To help to achieve a healthier lifestyle Silver spoon
have a number of lower calorie products like Half Spoon which has all the taste
and texture like sugar with half the calories . Including this Silver spoon
have a strong sales team with the ability to successfully communicate the
strength of the new product and they also have good reputation for innovation
and quality. Silver spoon is good in performance they always use innovation in
packing, speed in distribution, greater flexibility and delivery all over in
EU, quality of the materials. These are the reasons behind the success of
silver spoon because customers find it better and different than that of
rivals. (tutor2u.net)
3.3:
Discuss the appropriate strategic marketing objectives for the market chosen by
the organization
Product Life Cycle Management is
a strategic business approach that applies a consistent set of business
solutions in support of the collaborative creation, management, dissemination,
and use of product definition information across the extended enterprise, and
spanning from product concept to end of life-integrating people, processes,
business systems, and information. PLM forms the product information backbone
for a company and its extended enterprise. (PLCM)
Silver Spoon
also proud to be the first sugar manufacturer in the world to certify the carbon footprint of its sugar
according to the new PAS 2050 British standard, the world’s first standard for
assessing the lifecycle greenhouse gas (GHG) emissions of products and
services. (Silver Spoon)
Silver
Spoon is preparing to launch Truvia, the first “calorie-free” natural sugar
substitute sweetener product in the UK, in a bid to take a major share of the
£50m UK sweetener market.
Truvia, which
replicates the graininess and sweetness of sugar, but with zero calories, is
derived from the South American plant stevia that was authorised for use in the
UK and Europe last year. (Marketing Week)
Silver spoon has introduced the
new design for its bags of Granulated, Caster and Icing Sugars. Tony Lucas,
Silver Spoon Marketing Director said: ‘Our new packing shows Silver Spoon
sugar’s support of Britain’s sugar beet growers’. (Britsh Sugar)
Silver Spoon is the number one
supplier to the UK retail sugar and sweetener market and is a major sugar
supplier to the foodservice market. They are proud of the fact that our core
sugar range comes from British farms and that from field to spoon; our sugar
travels fewer miles than any other to reach consumers. They make their products
with concern not just for the quality of the sugar but also our impact on the
environment. The below key strategies for the successes of Silver
Spoon:-
·
Silver
Spoon has a range of sugars to suit all of your baking needs.
·
To
help achieve a healthier lifestyle, we have a number of lower calorie sugar and
sweeteners including Half Spoon which has all the taste and texture of regular
sugar with half the calories.
·
To
reduce our impact on the environment we are working closely with the Carbon
Trust and WRAP to further improve our production processes. (Silver Spoon)
Silver Spoon has a
special affinity with the Foodservice market. They are understand how important it is for chefs and catering
managers to get the right type of sugar in the right packaging at the right
price. That is why we have a dedicated Foodservice team, who are constantly
looking for ways to improve our product offering. New product development
especially for Foodservice users is very close to our hearts. They have
developed a diverse range of sugars in Foodservice-specific packaging to suit
your individual business needs. (Silver Spoon)
4.1:
How the organization responded to the changes to the external environment on a
given marketing strategy
For
every business external environment have strong impacts on making its decision
for strategic planning, as businesses are operated in space. This external
environment consists of many important factors which collectively influence the
business performance. These factors
include socio cultural, technological, demographic, natural environmental,
legal and political factors (K. M. Bartol, 1998) .
Silver spoon management has
successfully analyses its external environment conditions and created profit
driven strategies. Looking at social cultural factor, people have become more
concern about eating healthy food and diet conscious. Silver spoon has offered
various diet plans on its website, BMI check, and healthy sweet recipes. According to silver spoon, “Sugar is a natural source of
carbohydrate and therefore can contribute to a healthy lifestyle. If you are
watching those extra calories Silver Spoon has developed a range of Light and
Lower Calorie sweetening products to help you”. (Siler Spoon
Sugar Company, 2012)
As HSE (health & safety
executive) recommend that no more than 15 Kg should be carried by the workers,
silver spoon responds to this recommended safety measure very positively and
for care of its people and designed carry bags of 10Kg & 5Kg.
Focusing on environmental
conditions like other companies silver spoon always support the positive
changes in the environment and make its policies and strategies environmentally
safe. It has highest standards for environmental protection and sustainability
in both crop production and processing. It also cares for waste reduction and
recycling.
According to silver spoon website, “As the
UK’s number 1 sugar brand we are committed to reducing our environmental
impact. In January 2008 together with British Sugar we became a pilot partner
with the Carbon Trust. We believe carbon-foot printing needs to be implemented
with a standard methodology across the manufacturing industry if results are to
be meaningful to customers and consumers.” (Silver Spoon
Sugar Company, 2012)
From demographical point of view,
silver spoon has a wide range of products for different customers, people with
different tastes and nutrition requirement can buy a product according to their
own needs. It has offered Silver spoon Stay
soft range, caster sugar range, light & low range and others.
In similar ways Silver Spoon
Company is fruitfully facing changes and pressure coming from all of external
environment, few I have discussed above. As part of ABF group it comprises lot
to group profit by successfully running the business.
4.2:
An internal analysis of Silver spoon
An internal analysis can be
defined as strengths and weaknesses of an organisation. These factors
illustrate advantages and disadvantages of an organisation to meeting the
requirement of focused market. Strengths means core competencies that promote
benefits or a strength
is a factor controlled by or available to a organization that gives it an
advantage relative to its competitors in meeting the needs of the customers and
target market. Weakness is limitations or deficiencies in an organization’s
structure or resources related to its competitive forces that create
disadvantages to meeting customer requirements. (internal
analysis)
Silver spoon sugar’s current strengths
and weakness in marketing strategy
Strengths
·
Silver
spoon sugar is the number one supplier
to the UK retail sugar and sweetener market and the foodservice market. (Silver Spoon)
·
Silver spoon sugar is a product of British sugar
that is the sole
producer of UK home-grown sugar beet. It purchases the entire crop from around
9000 growers all of whom are under contract to the company. (Silver Spoon, 2012)
·
It
is a part of ABF (Associated British food).
·
It
provides wide range of sweetening choices like sugars for drinks and sprinkling, sugar and syrups for cooking, sweeteners, cake craft etc.
·
Silver Spoon offers an excellent range of lower
calorie sugars and sweeteners like trivia the new
natural calorie-free recipe.
·
From
January 2008, Silver spoon sugar also works with carbon trust that means it is
committed to reduce carbon emission of environment purposes. (silver spoon,
2012)
Weaknesses
·
Climate
change is affecting the production of sugar cane and sugar beet that includes
the impact of global warming, UK carbon emission that are still rising. (ABF, annual
report and accounts 2006, 2006)
·
Silver Spoon because of EU sugar regime change, granulated sugar
came under retail pricing pressure and sustained some volume reduction
impacting profit by £8m. (ABF, annual report and accounts
2006, 2006)
·
The
profit of silver Sugar reflected the impact of the crop shortfall resulting
from the frost damage sustained during the severe weather in winter. To meet
all customer requirements, despite the very tight market, using a combination
of destocking, supplies from third parties at high cost is also reflecting the
performance of silver spoon sugar. (ABF, associated british foods
plc, 2011
4.3:
Propose strategic marketing response to key emerging themes in a marketing
strategy for the organization
1936
was a very important year for the British consumer, that’s the year things got
a little sweeter with the launch of “The British Sugar Corporation”. The silver
spoon retail brand for granulated cubed, caster and icing sugar was launch in
1972. As the years goes by, British sugar has continue to keep Briton sweet
with the introduction of their new range of dessert in 1989.
Silver
Spoon has seen continuous growth over the years; they were able to achieve this
by adapting to the change in the external environment, listening to the
customer’s needs and promoting their products through TV adverts and other
advertising podium, hence, satisfying the customer’s needs.
British
sugar was taken over by Associated British Foods (ABF) in 1991; the takeover
has helped the market position of the silver spoon brand. Silver spoon has
strategically positioned it selves under the ABF brand and image, who has
influence the company corporate objectives, with the help of the 7ps and
porters five force, silver spoon were able to capitalized on their internal
strengths by exceeding the customers’ expectations, while achieving their
objective without compromising the quality of their service and products.
According to ABF (n.d.) The Ingredients
business is a key growth area for ABF in the UK and North America. The group
applies technical skills in producing functional ingredients from natural
products; ABF is a major manufacturer of both branded and private label grocery
products. Some of the best known household brands include Twinings, Ovaltine,
Mazola, Ryvita, Silver Spoon, Tip Top and Kingsmill
Silver
spoon company portfolio comprised some of the UK leading brands including
Allison, Askeys, Billinton’s, crusha and silver spoon.
The Silver Spoon Company is part
of Associated British Foods plc, a diversified international food, ingredients
and retail group with sales volume of £11.1 billion across 46 countries worldwide. Silver spoon continuous success is due to its
market position, they have introduce due new technologies, new products and re-launch with new packaging while
promoting their products and catering for the customer’s needs and maintain
their low price.
Conclusion
Today’s global market has seen immense competition from
companies on a global scale, companies are fully aware of competition and
technological advancement. With the help of ABF, Silver Spoon has strategically
positioned themselves as the UK market leader for sugar sweetener and low
calorie products.
Abiding by ABF corporate objectives, Silver Spoon
has strategically utilized these as their internal strengths. As the UK leading
supplier of sugar sweetener, Silver Spoon was able to corner the market through
companies like Crusha, Allison, Billinton and Askey, these companies are
offering their products under the Silver Spoon umbrella.
Silver Spoon success is due to strategically
positioning themselves as the market leader for sugar sweetener and their
ability to convert more customers into consumers by offering them on unbeatable
price for their products without compromising the quality of the products.
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