3. Objective
Examine the reason hiding behind Wrigley’s
Success in China via various channel, give out
constructive recommendations
4. Introduction
The Chinese Market
S.W.O.T. Analysis
Recommendation
5. • William Wrigley Jr. Company founded in
1891 Introduction
• Originally sold and
• Headquarters located in Chicago, Illinois
6. • 1892- William Wrigley Jr. began packaging the
chewing gum with the cans of baking powder.
Eventually the chewing gum became more
popular and the company began producing
chewing gum.
7. • Wrigley started his own chewing gum brands:
-Lotta- targeted the general market
-Vassar- targeted women
-Spearmint- cool and minty flavor
• That next year, Juicy Fruit, a sweet fruit-
flavored gum was introduced.
8. Tell em’
quick
Tell em’
often
Yeah, I’m
the one who
Advertise
9. • Production facilities expanded throughout the
following 100 years, eventually reaching
19 facilities in 19 countries. Wrigley
currently sells its products in over 180
countries.
10.
11.
12.
13. • Confectionery includes chocolate, sugar
confectionery and chewing gum.
• In 2007, the global confectionery market size
was around $141billion expected to grow to
$145billion by 2010.
16. • Wrigley were relatively weak in the sugar
confectionery market
• whereas Mars and Wrigley were strong in the
chocolate and chewing gum market,
respectively.
18. Exploring Enhancing Developing
Old Old New
Product Product Product
19. • Developed markets- Wrigley focused more
advanced benefits like natural and organic
ingredients, sensational pleasure,
convenience, more sophisticated innovations
for different target customers.
• Developing regions- Wrigley focused on
fundamental benefits of oral health and new
flavors.
34. China has been growing on average at a double –digit rate—and profitable
each year– since we started manufacturing locally back in 1993. We are also
not resting on past success, but are keenly focused on gleaning additional
marketplace insights to drive innovation that is both relevant and motivating
to consumers across China.
- William Wrigley Jr.II
35.
36. Product Price Promotion Place
new flavors for Extra, including cool mint,
strawberry, melon and blueberry
Extra Xylitol
New convenient package
Extra Xylitol and the Whitening series
Traditional Chinese herbal flowers and fruit
37. Product Price Promotion Place
become willing to spend more on confectionery
for their children (higher pricing)
38. Product Price Promotion Place
Benefits of dental care, weight control, stress
relief, and increasing alertness and concentration
fashionable and healthy image
maintain a fresh image to consumers by
introducing new variants every now and then.
39. Product Price Promotion Place
wide distribution network.
2.2 million distribution points, or over 90% retail
penetration
covered more than 300 cities in China
40.
41.
42. Strengths Weaknesses Opportunities Threats
Leading market position:
World’s largest gum company
- 63% of global market share in 2007. It was also the
- Fourth largest confectionary company in the world
Also in 2007, of the 7 top countries in terms of confectionery sales in
retail, Wrigley was a top confectionery player in 6 and the industry
leader in gum in 5.
Allows Wrigley to compete aggressively in every nation and leverage its
presence wherever it competes.
43. Strengths Weaknesses Opportunities Threats
Strong financial performance:
Robust financial performance in FY2005-07 periods:
- Revenue increase from $4,159.3 (32442.54HKD) in FY2005 to
$5,389.1 ($42,034.89HKD) in FY2007, a CAGR of 14%.
Operating profit increased from $776.3 ($6055.14HKD) million in
FY2005 to $962.8 ($ million in FY2007, CAGR growth of 11%.
Net profit followed the same pattern with an increase of 11% in
FY2007.
Strong financial performance enhances its stakeholder’s confidence.
44. Strengths Weaknesses Opportunities Threats
Research and Development capabilities:
Wrigley has strong research and development (R&D) capabilities.
Its R&D expenses were $60,796 ($474,208.8HKD) in FY2007.
Has 80+ innovations in products or packaging thanks to R&D.
- “5” Gum’s Rain and Cobalt flavors ranked first and third.
Innovation in packaging is increasing consumption of other brands.
- Germany’s launch of a premium bottle package
- Poland’s new peg bag pouch provides added value to
consumers.
In FY2007, new products accounted for approximately 20% of its net
sales.
45. Strengths Weaknesses Opportunities Threats
Diversification of confectionary business:
Wrigley acquired by Mars, Inc. in October 2008.
Combined, now commands over $27 billion in sales and employs more
than 64,000 associates worldwide.
Strong foundation of established brands in 6 core categories:
- Chocolate
- Non-chocolate confectionery
- Gum
- Food
- Drinks
- Pet care
46. Strengths Weaknesses Opportunities Threats
Brands include:
M&Ms
Snickers
Mars
Orbit
Extra
Doublemint
Has strengthened, diversified, Enhanced growth potential and given us
a competitive advantage.
47. Strengths Weaknesses Opportunities Threats
High dependence on the US markets for revenue generation:
The US accounts for approximately 90% of its North America’s net sales
and assets.
29.4% of its total revenue in FY2007 was the from US.
This makes Wrigley’s in the US more exposed to country specific factors
such as labor strikes, changes in economic conditions and increasing
competition.
48. Strengths Weaknesses Opportunities Threats
High dependence on the US markets for revenue generation:
The US accounts for approximately 90% of its North America’s net sales
and assets.
29.4% of its total revenue in FY2007 was the from US.
This makes Wrigley’s in the US more exposed to country specific factors
such as labor strikes, changes in economic conditions and increasing
competition.
49. Strengths Weaknesses Opportunities Threats
Seal of acceptance from the American Dental Association likely to push
up sales:
American Dental Association’s (ADA) Seal of Approval for Extra, Eclipse
and Orbit in September 2007.
ADA is the nation's largest non-profit dental association,
representing more than 155,000 dentists
The ADA Seal displays that chewing Wrigley's sugar-free gums can help
maintain good oral health.
The seal is also highly influential in increasing purchases among
consumers.
More than 92% of consumers said their purchase intent increased
when they saw the ADA seal.
50. Strengths Weaknesses Opportunities Threats
Emerging economies of China and Russia to boost its revenues:
In China, and Russia the company is seeing double-digit category
growth rates.
China is the third-largest economy in the world and Wrigley is China’s
largest confectionery company.
Wrigley has built greater retail distribution than any other consumer
product company - ACNielsen.
However, it still remains toward the lower end of the global scale.
Despite this, Wrigley’s full range of confectionery offerings has
established a strong foundation for future business expansion.
51. Strengths Weaknesses Opportunities Threats
Growing Hispanic population in US:
Hispanics are the most rapidly growing ethnic group in the US.
The US Census estimates that by 2020, the Hispanic population will
reach 59.7 million or almost 17.8% of the total US population.
Nielsen Media Research estimates that the buying power of Hispanics
will exceed $1 trillion USD by 2008 (a 55% increase over 2003 levels)
Wrigley has appointed the Bravo Group (Bravo) agency of record for
Hispanic creative and promotional marketing efforts in the US.
52. Strengths Weaknesses Opportunities Threats
Intense competition:
Wrigley faces stiff competition from big multinational companies – primarily
with Cadbury.
Second-largest producer of chewing gum in the world
Recently, Cadbury strengthened its position after acquiring Intergum, a low-
cost Turkish gum producer.
Cadbury was the one to launch Trident and Dentyne gum brands in the UK.
This severely dented Wrigley’s near 100% market share in the UK
Trident Splash brand of gums is taking over market shares.
Cadbury’s sugar-free gums in the US.
Wrigley also competes with Hershey in other non-chocolate categories (e.g.
hard and chewy candy including mints).
53. Strengths Weaknesses Opportunities Threats
Chewing gum tax:
Governments, especially Ireland and England, are imposing new policies on
chewing gum companies.
Forces them to pay towards the cost of cleaning up their products.
The Irish government persuaded Wrigley, to make a contribution of $7million
towards clean-up costs after it threatened to impose a purchase tax on the
manufacturer.
Westminster Council is also urging ministers to follow the example of the Irish
government.
54.
55. How do you advertise/Market to a market you
dominate:
The market was a large and mature industry
with little competition.
Mars Merged with Wrigley Making it the
worlds largest confectionery company.
Has roughly 14% of the global confectionery,
now the 2nd largest Cadbury holds about 10%
of the global market share.
56. -----1.0,2.0,3.0 Info on Want to Raise
Market Strategy. awareness of brands
and product
Advertising Innovation
Choose to integrated
with outside agencies
TV , Print and Radio
(Old)
Must recapture all the
benefits of multi-brand
and keep defining the
key factors to success
57. Technology has shifted from the mechanical
world to the digital world!
1.0 = Being product Centric
2.0 = Consumer –centric
3.0 (Today) we see marketing as transforming
again in response to the new dynamic
environment. (Human kind)- what moves you?
-Note- The idea of mkt 3.0 started in Asia! Nov.
2005 –Consultant Group-
58. Attention was given to a nation where human
centricity and the character of spirituality
overcame the challenges of diversity.
3.0 Must Make Use of Media:
Expressive Social media: Blogs, Twitter, YouTube
etc.
Collaborative media: Wiki, Rotten Tomatoes,
Craigslist. ( People can do there own
homework now and Choose)
59. PERCEPTIONS & Choice Chinese buy Avg. 10 sticks of
http://www.ted.com/talks/lan Gum a year
g/eng/sheena_iyengar_on_t American’s Avg. 160
he_art_of_choosing.html Taiwan Avg. 70-80
8:40s to 10:15
A Manager of Wrigley
-- Ideas to think about-
said “ I don’t think
Wrigley's started as a soap
Co. – started giving out one People know how
stick of gum with xyz global Wrigley’s is” In
product…. Bring this back: the past they have
In China: Only have sticks of
gum in Dental and health always branded
facilities. Locally
60. A Blogger “all it is http://www.youtube.
repackaged Wrigley com/watch?v=RE4C
spearmint” HTiHS_8
This may be true
however they have
found a way to
recapture the
attention of the there
target Audience
(Marketing 3.0)
61. Growing up on Gum TED Clip– Ref.
in the West vs. it just
being introduced in
1989/ Guangzhou
What is Chewing
Gum “fragranced
breath candy”
-What is Disney concept-
62. Concept Creation- In the coming 5 to 10
Benefits of Chewing years. It shall be
Improving oral health challenging for
Managing weight Wrigley to go beyond
gum and compete in
Relieves stress the larger
Some research confectionary market
suggested—Increased in order to sustain its
the flow of blood to growth in China.
the brain by 20-40%
63. Make partnerships
and business ventures
with the local
community
“Get involved”
Dental is a start
Gum/ Fast Food
Wrigley / fitness gym