The Hershey Company Is The Largest Chocolate Producer Marketing Essay

November 2, 2017 Marketing

The Hershey Company is the largest cocoa manufacturer in North America and besides one of the oldest US makers of cocoa and non-chocolate confectionery and chocolate-related food market merchandise. The Hershey Company operates in conformity with their mission statement: “ Undisputed Marketplace Leadership ” ( ) . Among the company ‘s good established trade names areA Hershey ‘s Chocolate Bar, Almond Joy, Kit Kat, Hershey ‘s Kisses, Reese ‘s and many others.

I shall get down an external analysis with the first component of Porter ‘s Five Forces Model: Industry Rivalry. Decelerate confectionery industry growing increases the strength of competition among legion rivals. It needs to be mentioned that the phase of confectionery industry life rhythm is Maturity phase. These cocoa have been around since a 100 old ages and most people purchasing these cocoas are repeat consumers. The Hershey Company holds one of the taking places in the domestic market, presently holding a market portion in the U.S. of over 22 % . Its biggest challengers in US market are Mars Inc ( the leader harmonizing to the industry ‘s 2010 consequences ) , Kraft Foods and Nestle. As for the planetary competition, harmonizing to the latest consequences of the confectionery industry ‘s planetary study, Hershey Foods Corp. ( USA ) is figure 5 among the top 100 international


confectionery trade names evaluation with 4,881 US ( $ ) 1000000s gross revenues volume figure. The chief rivals in the planetary market are Mars Inc ( USA ) , Cadbury Schweppes PLC ( UK ) , Nestle SA ( Switzerland ) and Ferrero SpA ( Italy ) . ( The Big Get Bigger, 2011, January 10 ) .

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Although the Hershey Company has a steady strong presence in the U.S. cocoa and confectionery market, its planetary place demands to be strengthened and the focal point should be kept on the planetary market. Quickly developing states such as China and India have to be Hershey ‘s chief marks because even a limited presence in these states would supply a significant addition in gross. Besides it, company can non double their domestic scheme and anticipate to be successful. On the contrary they must incorporate into each state ‘s civilization and develop an altered scheme to plunge their trade name name into these countries.

The following force I need to stipulate is the Hazard of Entry by Potential Competitors force and this hazard for cocoa industry is rather low. The grounds of it are important entry barriers ( high production end product, big capital demands, merchandise distinction, and client trueness ) . These factors deter smaller rivals from come ining into the market. ( Ellis M. , McCants M. , Frye N. , Miller J. , Polk M. , Rogers G, 2008, May 22 ) .


The 3rd and one of the most influential in the Hershey ‘s instance force is Dickering Power of Suppliers. Their bargaining power is comparatively high because the figure of providers of the cocoa industry is limited, supplier group is concentrated and there are no replacement merchandises every bit good. The Hershey Company needs to happen alternate ( non-West African ) locations or different methods for obtaining chocolate beans, because this would let Hershey to hold a secure control over their natural stuffs.

The following force is Dickering Power of Buyers which can be described as low to chair. This industry has several big volume retail merchants that have important bargaining power. Large volume retail merchants can dicker for lower monetary values and cut down the industry ‘s net incomes, but the differentiated merchandises ( with high degree of trade name designation and client trueness among the cocoa consumers ) well cut down the power of purchasers.

Finally, the Threat of Substitutes for cocoa industry is moderate. There are legion utility merchandises such as alternate cookery spirits ( such as vanilla, butter, etc ) and non-chocolate bites ( such as ice pick, fruits, etc. ) . Besides there is a menace of unhealthy image of cocoa merchandises among the consumers.

Besides Porter ‘s Five Forces Model and Industry ‘s Life Cycle I would wish to analyse the manner demographic, societal, or


technological tendencies have influenced the cocoa confectionery industry.

There are some positive and negative socio-cultural and demographic tendencies that make an influence. Among the positive are: the desire for richer products/changing gustatory sensations, joint ventures ( i.e. java ) , dark cocoa wellness benefits and increased importance of vacations. The negative tendencies are: spreading of allergic reactions, increasing fleshiness and greater environmental concern.

Among the social/political tendencies a job of kid labor and unjust trade can be named. For illustration, Hershey has been criticized for non holding plans to guarantee sustainable and ethical chocolate purchase, dawdling behind its rivals inA just tradeA steps. ( Hershey Dominates US Market, but Lags Behind Competitors in Avoiding Forced Labor, Trafficking and Child Labor ( 2010, September 13 ) . The positive technological tendencies are: technological betterments to milking machines, efficiency betterments for distribution, telecommunications. And the negative technological tendencies are deficiency of authorities support to developing states ( hapless instruction of new engineerings ) and increased cost of pull offing the fabrication technological advancement. And I would wish to complete this essay with Hershey Company laminitis Milton Hershey quote about the most typical characteristic of Hershey ‘s merchandises: “ Give them quality. That ‘s the best sort of advertisement in the universe ” .



Hershey motto ( n.d. ) is retrieved from

The Big Get Bigger ( 2011, January 10 ) . Retrieved from hypertext transfer protocol: //

Ellis M. , McCants M. , Frye N. , Miller J. , Polk M. , Rogers G, ( 2008, May 22 ) . The Hershey Company – Introducing the World of Chocolate. Retrieved from hypertext transfer protocol: // ? p=65

Hershey Dominates US Market, but Lags Behind Competitors in Avoiding Forced Labor, Trafficking and Child Labor ( 2010, September 13 ) . Retrieved from hypertext transfer protocol: //

Confectionery Company Shares Report ( 2010 ) , USA. Packaged Food: Euromonitor from trade sources/national statistics.


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