Rogers Chocolates

Topics: Chocolate, Types of chocolate, Brand Pages: 10 (2746 words) Published: March 6, 2013
Question 1

What is competition like in the premium chocolate industry? Which of the five competitive forces is strongest? Which is weakest? What competitive forces seem to have the greatest effect on industry attractiveness and the potential profitability of new entrants?

The premium chocolate industry is having an intensive competition in Canada with the strong growth potential. Industry growth opportunity imposes increasing competition from rivals and threats of new entrance that adds pressure on overall profitability. Even though Roger’s has been able to establish its place in the chocolate industry with its strong brand recognition and products’ quality, it still needs to be on top of ever- going market changes, by continuously  monitoring, crafting and updating  its marketing and packaging strategies. Only then it can sustain its competitiveness from the front line rivals.  For that, intensity of rivalry among competitors and the threat of new entrants are considered the strongest competitive force, given the fact that the premium chocolate market was growing at 20 percent annually. Given that Rogers’ Chocolates has successfully targeted market niche by its strategy based on differentiation, and by concentrating on narrow consumers segment comprising of affluent customers looking for a luxury experience with a superior taste or an elegant, prestigious and uncommon product, it can be said that the weakest competitive force for Rogers’ is the bargaining power of buyers and the suppliers.  Differentiation and niche market remedies the opportunity of price fixing. The threat of substitute products is also at the weakest point, given the fact that Rogers’ chocolates are fairly expensive relative to others in market. Their distinctive hand-packaging process and quality ingredients are not much appealing for others to copy and imitate. The rapid growth and profit prospects factors are attractive enough to induce additional entry to this industry.  For that, every chocolate producer is challenged to craft a successful strategy that is strong enough to fight for its profit in competition battle. The competition of the premium chocolate industry is strong. There are some regional brand businesses and some large companies. The key market competitors that are Rogers’s direct rivals are summarized in the table:

Company Name| Price| Quality| Packaging| Distribution| Advertising| Godiva| 15 % High than Rogers' on standard products and double/triple price on premium chocolate| Not as high as Rogers'| Strong; glitzy, sleek & modern. Chocolates of various colors & molding| Retailers of gift items| Strong| Bernard Callebaut| Similar to Godiva| Good , excelled in new flavour introductions| Superior & could be customized at the store| 32 stores across the West, US and Ontario| Great seasonal displays| Lindt| 90% of Rogers'| Mid-range| Mid-range| Broad : mass merchandisers, drug & grocery retailers| Strong| Purdy's| 35% lower than Rogers'| Lower than Rogers'| Good| 50 locations based in malls , strongest presence in BC| Good, offers discounts on volume purchase| Rogers'| Premium price, however low than Godiva's & Bernard Callebaut's| High| hand packaging, old fashioned, not appealing to young consumers| Company owned stores; online & mail orders, wholesaling, Sam's Deli| Limited to Victoria's area|

Question 2

How is the premium chocolate industry changing? What are the underlying drivers of change and how might those driving forces individually or collectively change competition in the industry?

The premium chocolate industry is showing its shift towards healthy nutrition trend and consumers’ market that is more health conscious about their diet. Purchasers are also demanding more from chocolate than its taste. In line with a broad social trend for healthier diets, the demand for organic products, including organic chocolates, is growing. Consumers are...
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