Charles Chocolates Case
Charles Chocolates Case Analysis
In March of 2012 Steve Parkland was hired as the new president at Charles Chocolates. He was immediately faced with numerous decisions about the future of the company. The board of directors had tasked Parkland with doubling or tripling the size of the company over the next decade, but the board and the senior management team had different opinions about the strategy that would accomplish this goal. The main issues that Parkland faced were how to increase the company’s operations while maintaining the traditional culture and support of the board.
The premium chocolate industry is a large market in the United States and continues to grow around 10% annually. It is also populated with very strong competitors both internationally, with companies like Godiva (Nestle), and local companies like Delice. Both competitors are priced higher than Charles and have higher sales. This is most likely because Godiva and Delice have modern trendy packaging for their products. The number and strength of competitors means that buyers have very high bargaining power, but it also means that the threat of new entrants is low because it is hard to gain a piece of a market saturated with such powerful players. The majority of the suppliers to the chocolate industry sell commodity products whose price is set by the market and their power and influence is low. There are numerous substitute products for affluent customers’, confections and pastries being the most significant, but chocolate will always be a stable product so it is a medium level threat.
To compete in such a challenging industry Parkland needs to revitalize the company’s packaging and its marketing campaign. New packing is an ideal way to begin because it demonstrates the changes that will be taking place in following years without compromising the company’s heritage or corporate culture. Charles’ current marketing strategy strongly targets the local community which it already has a
In March of 2012 Steve Parkland was hired as the new president at Charles Chocolates. He was immediately faced with numerous decisions about the future of the company. The board of directors had tasked Parkland with doubling or tripling the size of the company over the next decade, but the board and the senior management team had different opinions about the strategy that would accomplish this goal. The main issues that Parkland faced were how to increase the company’s operations while maintaining the traditional culture and support of the board.
The premium chocolate industry is a large market in the United States and continues to grow around 10% annually. It is also populated with very strong competitors both internationally, with companies like Godiva (Nestle), and local companies like Delice. Both competitors are priced higher than Charles and have higher sales. This is most likely because Godiva and Delice have modern trendy packaging for their products. The number and strength of competitors means that buyers have very high bargaining power, but it also means that the threat of new entrants is low because it is hard to gain a piece of a market saturated with such powerful players. The majority of the suppliers to the chocolate industry sell commodity products whose price is set by the market and their power and influence is low. There are numerous substitute products for affluent customers’, confections and pastries being the most significant, but chocolate will always be a stable product so it is a medium level threat.
To compete in such a challenging industry Parkland needs to revitalize the company’s packaging and its marketing campaign. New packing is an ideal way to begin because it demonstrates the changes that will be taking place in following years without compromising the company’s heritage or corporate culture. Charles’ current marketing strategy strongly targets the local community which it already has a