STRATEGIC MANAGEMENT

CASE 32: CAMPBELL: IS THE SOUP STILL SIMMERING?

Professor: Dr. Thomas Bradley

CLASS 1

GROUP 6:

Names: KEUKA ID Numbers:

Phạm Thùy An 295913

Nguyễn Thị Phương Hà 295901

Phan Tuấn Vũ 295919

CONTENT

Pages

I. Introduction ........................................................................................................................... 1

1. Mission ............................................................................................................................... 2

2. Vision ................................................................................................................................. 2

3. Objectives ........................................................................................................................... 2

4. Strategies ............................................................................................................................ 3

II. Problem .................................................................................................................................. 3

III. Product lines .......................................................................................................................... 4

IV. Competition........................................................................................................................... 10

V. Overview ............................................................................................................................... 13

VI. Market condition .................................................................................................................. 13

VII. Organization chart ............................................................................................................... 14

VIII. Financial Analysis ................................................................................................................ 15

IX. SWOT Analysis .................................................................................................................... 20

X. Product life cycle .................................................................................................................. 23

XI. CPM - Competitive Profile Matrix ..................................................................................... 25

XII. External Factor Evaluation Matrix (EFE)......................................................................... 27

XIII. Internal Factor Evaluation Matrix (IFE)........................................................................... 31

XIV. Space Matrix ......................................................................................................................... 35

XV. Grand Matrix........................................................................................................................ 37

XVI. Quantitative Strategic Planning Matrix (QSPM) ............................................................. 42

XVII. Recommendation .................................................................................................................. 46

XVIII. Timetable............................................................................................................................... 47

1

I) INTRODUCTION1

Campbell Soup Company, also known as Campbell's which is founded by American in 1869;

they open their first plant in Camden, New Jersey. They produce canned soups and related

products. Campbell's products are presented in 120 countries around the world. Campbell’s

products are divided into three parts, the first part is the simple meals which consists largely of

soups both condensed and ready-to-serve, the second part is the baked snacks which consists of

Pepperidge Farm and the final is the health beverage which includes V8 juices. In addition,

Campbell is running a program for schools as known as Labels for Education. Moreover,

Campbell has posed slogans as a commitment such as Mmm Mmm Good presented in 1960s,

their predominantly used slogan, Give Me The Campbell Life (1969-1975), Soup Is Good Food

(1975-c.1982), Possibilities (2005–2009), So Many Many Reasons It's So Mmm Mmm Good

(2008–2010), It's Amazing What Soup Can Do! (2010–present), never underestimate the power

of soup! (1990's). Campbell's brands are listed more detail below.

1 (n.d.). Retrieved August 30, 2014, from http://www.campbellsoupcompany.com/about -campbell

2

1 Mission: is to nourish people’s lives by offering a wide variety of convenient, delicious, and

affordable food choices that can help everyone enjoy a balanced, healthful diet.

The foundation of Campbell’s culture is three core values:

Character: We are driven to inspire trust and act with integrity in all that we do. We take

personal responsibility, and we drive our future with optimism.

Competence: We are a learning organization that values diverse perspectives. We seek to

develop new capabilities to drive growth and innovation, and we execute our plans with

agility to deliver business results.

Teamwork: We bring an enterprise-wide mindset to our work by connecting and

collaborating with one another across the organization. We call this operating as "One

Team Plus."

2 Vision: to build a focused global food company with superior consumer brand value, and to

deliver sustainable, profitable net sales growth.

3 Objectives:

Nourishing our planet

Nourishing our

neighbors

Nourishing our

employees

Nourishing our

customers

Cut the

Environmental

Footprint of Our

Product Portfolio in

Hal

Measurably Improve

the Health of Young

People in Our

Hometown

Communities

Leverage CSR and

Sustainability as Key

Drivers of Employee

Engagement in Our

Culture

Continue to Provide

Consumers with

Nutrition and

Wellness Choices in

Our Product Portfolio

3

4 Strategies:

Develop its brands in three core categories: soup simple meals, snacks and healthy

beverages.

Expand the international presence.

Ameliorate the organizational excellence, diversity and engagement.

Increase margins by adjust price realization and company-wide total cost management.

Care for their customer’s wellness needs, product quality and product convenience.

Consolidate its scale of company by outside partnerships and acquisitions

Commit strongly to sustainability and corporate social responsibility.

II) PROBLEM

As is known, Campbell Soup Company is one of the companies that have strong competitive

position in packaged food industry. Campbell's products also have a strong position in customer's

trust. However, package foods market has many competitors over times that lead to few new

consumers, this market becomes saturated in recent years. That circumstance influences to price,

net income and the growing of many companies, Campbell Soup Company is also not exception.

According to Campbell soup and financial annual report, the total revenue is rather stable and a

little bit increase, however, its net profit is decrease dramatically from 2011 to 2013. The reasons

may be lot competitors, unpredictable customer needs, competitive prices or operating expense.

4

III) PRODUCT LINES2

SOUP COLLECTION

Firstly, Campbell had the great ideas for food service, special is Soup Collections which is the

flexible, convenient and consistent soup. Campbell’s soup offers all the flavor, format and

versatility customer needs to satisfy consumer demands as much as possible.

Campbell's Signature soups

Available in a range of authentic flavors, Campbell's

Signature soups make it simple to deliver customer

favorites every day.

Campbell' Signature soups are available in two formats

for maximum versatility: the ready-to-cook condensed frozen 3/4 lb. tub that yields

approximately 384 fl. oz., or the ready-to-eat frozen 4/4 lb. pouch that yields approximately 256

fl. oz.

As is shown, to create diversity, Campbell's Signature soups have more than 50 flavors to

choose. For example:

Beef Pot Roast is made with tender beef and vegetables including

potatoes, carrots and celery in a seasoned broth simmered with

aromatic herbs. Its nutrition contains 120 Calories, 10 mg

Cholesterol, 3 g Total, 880 mg Fat Sodium, Total 15 g Carbohydrate,

2 Product Research. (n.d.). Retrieved August 30, 2014, from http://www.campbellfoodservice.com/

5

7 g Protein, 10 % Vitamin A, 4 % Calcium, 6 %Iron.

Buffalo Style Chicken with Blue Cheese is a creamy chicken soup

made with tender vegetables and blue cheese finished with a dash

of hot sauce. Its nutrition contains 210 Calories, 14 g Total Fat, 30

mg Cholesterol, 860 mg Sodium, 14 g Total Carbohydrate, 8 g

Protein, 6 % Vitamin C, 20 %Calcium, 2 %Iron.

Campbell's Reserve soups

Campbell's Reserve soups also known as the art of flavor is

premium, appealing soups that make it easy to bring complex

flavor to the menu. With 23 surprising flavors are handcrafted

with real cream, rich stocks and distinctive specialty ingredients

like Thai spices, and Madeira wine.

For example:

Broadway Basil & Tomato Bisque is made with a pure´e of vine-

ripened red tomatoes blended with heavy cream and onions

simmered in real chicken stock, then finished with sweet basil. Its

nutrition contains 280 Calories, 21 g Total Fat, 35 mg Cholesterol,

820 mg Sodium, 19 g Total Carbohydrate, 3 g Protein, 6 %

Vitamin A, 4 % Vitamin C, 2 % Calcium, 6 % Iron.

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Cream of Tomato with Roasted Red Pepper is delicious creamy

bisque of tomatoes and roasted red bell peppers, finished with

cream and butter. . Its nutrition contains 330 Calories, 25 g Total

Fat, 65 mg Cholesterol, 970 mg Sodium, 23 g Total

Carbohydrate, 4 g Protein, 25 % Vitamin A 10 % Vitamin C, 6 %

Calcium, 4 % Iron

BEVERAGES

Furthermore, Campbell promoted their business in food service and launched beverage brands

such as vegetable juice, juice drink (V8 Splash) and juice (V8 V-Fusion) of V8 brands; tomato

juice. In addition, V8 is made 100% vegetable juice that is known as positive nutrition provides

the good for consumer nutrients and food groups that customer's patrons want and need.

Campbell has over 20 beverage kinds that provide a full serving of vegetable, and over 60 that

provide a good source of vitamins.

For example:

V8 100% Vegetable Juice Low Sodium helps body get 2 servings

of vegetables in every nutritious 8-ounce serving; it can reach 70

percent less sodium. It’s also an excellent source of potassium

which helps maintain fluid balance and normal heart rhythm. Diets

containing foods that are a good source of potassium and low in

sodium may reduce the risk of high blood pressure and stroke.

Besides, audience will have more choice into Spicy Hot V8 Vegetable Juice with strange and

various flavors.

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Each variety of V8 Splash is a refreshing

blend of delicious fruity flavors with a hint of

carrot and includes Antioxidants Vitamins A

and C. It’s the perfect afternoon lift to help

consumers stay energized and active

throughout the day.

V8 V-Fusion is a breakthrough juice that gives consumers a full serving of vegetables plus a full

serving of fruit in every 8-ounce glass. The result is a nutrition-packed beverage made of 100%

juice that’s also delicious and refreshing. Get the Veggies, Taste the Fruit.

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Campbell's Tomato Juice from Concentrate is the perfect blend of

taste and nutrition. Campbell's only uses tomatoes that are vine

ripened to perfection to ensure that gets the full rich tomato flavor

you've come to expect from Campbell's Tomato Juice from

Concentrate.

ENTREES

Created by Campbell's Chefs, these entrées provide quality, consistent products that will help

customer expand their menu and increase their profitability. Packaged in convenient aluminum

trays, Campbell's frozen entrees help consumer reduce food and labor costs by reducing the

number of ingredients needed on hand, by providing better control over portion size and by

reducing preparation and clean-up time.

Garden Vegetable Lasagna in Campbell’s Frozen Entrées

collection made by fresh egg noodle pasta layered with carrots,

broccoli, spinach and onions in a rich blend of ricotta,

mozzarella, and American and Parmesan cheeses. Well-balanced

taste, with a light and golden bread crumb topping. Its nutrition

contains 310 Calories, 16 g Total Fat, 15 mg Cholesterol, 800 mg

Sodium, 33 g Total Carbohydrate, 8 g Protein, 6 %Vitamin A, 15 %Calcium, 2 % Iron.

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V8 Garden Vegetable & Three Cheese Lasagna in V8 Frozen Entrées is

a delicious way to get vegetables. Lasagna noodles layered with rich

diced tomatoes, creamy ricotta cheese, sweet red peppers, mushrooms,

zucchini, broccoli, yellow peppers, spinach, carrots, onions and

mozzarella, Parmesan and Romano cheeses steeped in a tangy tomato

sauce. It contains 230 Calories, 6 g Total Fat, 30 mg Cholesterol, 730 mg Sodium, 32 g Total

Carbohydrate, 11 g Protein, Vitamin A, Vitamin C, Calcium, Iron, Vitamin E, Vitamin B6,

Vitamin B12, Zinc 15 %.

Tender cooked beans, beef, and other seasonings are blended

together to offer a top quality chili at a competitive price.

SALSAS, SAUCES, GRAVIES & MARINADES

Campbell have a wide variety of salsas, sauces, gravies and marinades to suit any operation.

From bold and authentic Pace salsas and Campbell's Stock Pot sauces to our ready-to-serve

sauces and gravies

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PEPPERIDGE FARM BAKERY PRODUCTS

Pepperidge Farm delivers the iconic brands patrons know and love. From delicious cookies,

crackers and baked pastries to Goldfish bread and snacks, Pepperidge Farm brands are available

in the varieties and formats you need to drive your business

IV) COMPETITION

Campbell sought in the highly competitive food industry and much capabilities worldwide

competition for its basic products. There are some main areas of competition such as brand

recognition, quality, price, advertising, promotion, convenience, and service.

Nestle

Nestle was well- known brand name over the world, specifically, it was the world’s leader in

coffee ( Nescafe), one of the world’s largest bottled water markers (Perrier) , and a top player in

the pet food business ( Ralston Purina). There were several its famous brands such as Buitoni,

Friskies, Maggi, Nescafe and Nestle. Moreover, it became a major player in the U.S baby food

sector after adding Gerber baby foods to its baby principle business.

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General Mills

General Mills was the second cereal maker in U.S and its brand involved Cheerios, Chex, Total,

Kix, and Wheaties. In addition, it was also a brand leader in flour (Gold Medal), baking mixes

(Betty Crocker, Bisquick), dinner mixes (Hamburger Helper), fruit snacks (Fruit Roll-Ups), grain

snacks (Chex Mix, Pop Secret), and yogurt (Colombo, Go-Gurt, and Yoplait). Although it got

much profits from US, it was trying to raise the reach and the point of its brands around the

world.

Kraft Foods

The newly independent company spun off by Mondelez International (formerly Kraft Foods

Inc.). Kraft cheeses, beverages (Maxwell House coffee, Kool- Aid drinks) convenient meals

(Oscar Mayer meats and Kraft mac’n cheese), grocery fare (Cool Whip, Shake N’ Bake), and

nuts (Planters). Kraft Food Group was looking to revive its trade in North American.

Heinz Company

H. J. Heinz had thousands of products and it spread over than 50 countries. It manufactured

ketchup, condiments, sauces, frozen food, beans, pasta meals, infant foods and the processed

food products. Its leading brands includes Heinz ketchup, Lea & Perrins sauces, Ore-Ida frozen

potatoes, Boston Market, T.G.I Friday’s, and Weight Watchers foods.

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Direct Competitor Comparison

CPB GIS HNZ MDLZ Industry

Market Cap: 14.11B 31.39B 23.21B 53.58B 8.16B

Employees: 17,870 35,000 32,200 110,000 5.8OK

Qtrly Rev Growth (yoy) 0.11 0.08 0.02 N/A 0.52

Revenue (ttm) 8.10B 17.43B 11.69B 35.02B 17.43B

Gross Margin (ttm) 0.38 0.37 0.36 0.37 0.33

EBITDA (ttm) 1.68B 3.50B 2.03B 5.35B 3.50B

Operating Margin (ttm) 0.16 0.17 0.14 0.12 0.14

Net Income (ttm) 737.00M 1.81B 1.04B 1.54B N/A

EPS (ttm) 2.34 2.73 3.07 1.69 2.32

P/E (ttm) 19.23 17.84 23.59 17.81 23.68

PEG (5 yr expected) 3.08 2.28 3.08 1.55 2.28

P/S (ttm) 1.75 1.80 1.98 1.53 2.02

CPB=Campbell Soup Co.

GIS= General Mills, Inc.

HNZ= HJ Heinz Co

MDLZ= Mondelez International Inc.

Industry= Processed & Packaged Goods

Source: Yahoo Finance, finance.yahoo.com

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V) OVERVIEW

In general, Campbell’s large- scale was also lower through the amount of employee (17,870), so

its revenue, net income and EBITDA were lower than others. Moreover, almost competition

companies had considerable investment and diversified products. Therefore, this was difficult

competition for Campbell.

VI) MARKET CONDITION

In 2011, it grew faster value growth than it did in 2010 which is recorded by The U.S. packaged

–food industry because of a rise in commodity prices. In retail capacity, Americans began to eat

out more often again lead to slower growth rates of many kinds in 2011. Moreover, it happened

after a couple of years when cooking at home had become more prevalent alternative in

reflection to the recession and the sharp increase in commodity prices in 2008.

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VII) ORGANIZATION CHART3

3 Organization Chart Campbell Soup (2014, July 23). Retrieved August 30, 2014, from

http://www.theofficialboard.com/org-chart/campbell-soup

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VIII) FINANCIAL

Income Statement4

Period Ending Jul 28, 2013 Jul 29, 2012 Jul 31, 2011

Total Revenue 8,052,000 7,175,000 7,143,000

Cost of Revenue 5,140,000 4,365,000 4,255,000

Gross Profit 2,912,000 2,810,000 2,888,000

Operating Expenses

Research Development 128,000 116,000 120,000

Selling General and Administrative 1,653,000 1,532,000 1,496,000

Non Recurring 51,000 7,000 60,000

Others - - -

Total Operating Expenses - - -

Operating Income or Loss 1,080,000 1,155,000 1,212,000

Income from Continuing Operations

Total Other Income/Expenses Net 10,000 8,000 10,000

Earnings Before Interest And Taxes 1,090,000 1,163,000 1,222,000

Interest Expense 135,000 114,000 122,000

Income Before Tax 955,000 1,049,000 1,100,000

Income Tax Expense 275,000 325,000 351,000

Minority Interest 9,000 10,000 3,000

Net Income From Continuing Ops 680,000 724,000 749,000

Non-recurring Events

Discontinued Operations (231,000) 40,000 53,000

Extraordinary Items - - -

4 Income Statement - Campbell Soup Company (CPB) (2014, August 29). Retrieved August 30, 2014,

from https://finance.yahoo.com/q/is?s=CPB

16

Effect Of Accounting Changes - - -

Other Items - - -

Net Income 458,000 774,000 805,000

Preferred Stock And Other Adjustments - - -

Net Income Applicable To Common Shares 458,000 774,000 805,000

5

Balance Sheet6

Period Ending Jul 28, 2013 Jul 29, 2012 Jul 31, 2011

Assets

Current Assets

Cash And Cash Equivalents 333,000 335,000 484,000

Short Term Investments - - -

Net Receivables 635,000 553,000 560,000

Inventory 925,000 714,000 767,000

Other Current Assets 328,000 169,000 152,000

Total Current Assets 2,221,000 1,771,000 1,963,000

Long Term Investments - - -

Property Plant and Equipment 2,653,000 2,127,000 2,103,000

Goodwill 2,297,000 2,013,000 2,133,000

Intangible Assets 1,021,000 496,000 527,000

Accumulated Amortization - - -

Other Assets 131,000 123,000 136,000

Deferred Long Term Asset Charges - - -

Total Assets 8,323,000 6,530,000 6,862,000

Liabilities

5 Income Statement - Campbell Soup Company (CPB) (2014, August 29). Retrieved August 30, 2014, from https://finance.yahoo.com/q/is?s=CPB 6 Balance Sheet - Campbell Soup Company (CPB). (2014, August 29). Retrieved August 30, 2014, from

https://finance.yahoo.com/q/is?s=CPB

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Current Liabilities

Accounts Payable 1,259,000 1,284,000 1,332,000

Short/Current Long Term Debt 1,909,000 786,000 657,000

Other Current Liabilities 114,000 - -

Total Current Liabilities 3,282,000 2,070,000 1,989,000

Long Term Debt 2,544,000 2,004,000 2,427,000

Other Liabilities 798,000 1,260,000 983,000

Deferred Long Term Liability Charges 489,000 298,000 367,000

Minority Interest (7,000) - 8,000

Negative Goodwill - - -

Total Liabilities 7,106,000 5,632,000 5,774,000

Stockholders' Equity

Misc Stocks Options Warrants - - -

Redeemable Preferred Stock - - -

Preferred Stock - - -

Common Stock 12,000 20,000 20,000

Retained Earnings 1,772,000 9,584,000 9,185,000

Treasury Stock (364,000) (8,259,000) (8,021,000)

Capital Surplus 362,000 329,000 331,000

Other Stockholder Equity (565,000) (776,000) (427,000)

Total Stockholder Equity 1,217,000 898,000 1,088,000

Net Tangible Assets (2,101,000) (1,611,000) (1,572,000)

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a. Short- term solvency or liquidity, ratios.

Current ratio = Current assets/ Current liabilities

Year 2013: 2221/ 3282 = 0.676

Year 2012: 1771/ 2070 = 0. 855

7 Balance Sheet - Campbell Soup Company (CPB). (2014, August 29). Retrieved August 30, 2014, from https://finance.yahoo.com/q/is?s=CPB

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The current ratio in 2012 is less than 1 and in 2013 is also; even it decrease compare to 2012.

This is seemed to be a bad thing because the current liabilities are greater than current assets and

net working capital is negative.

Quick ratio = Current assets - Inventory / Current liabilities

Year 2013: 2221 - 925 / 3282 = 0.394

Year 2012: 1771 - 714 / 2070 = 0.510

So this figures are lower than 1, Campbell Soup Company ability is low to pay short-term

liabilities without selling the inventories.

Cash ratio = Cash / Current liabilities

Year 2013: 333/ 3282 = 0.101

Year 2012: 335/ 2070 = 0.161

So cash ratios are lower than 1 in 2012 and 2013, Campbell Soup Company does not have

enough the amount of cash and cash equivalents sufficient to meet all the short-term debt.

However, there are very few companies have this capability so this is not too serious.

b. Long- term solvency or financial leverage, ratios.

Total debt ratio = Total assets - Total equity / Total assets

Year 2013: 8323 - 1217/ 8323 = 0.853

Year 2012: 6530 - 898 / 6530 = 0.862

These rates are higher than 50 %, it shows that company is growing in its industry

Debt - equity ratio = Total debt/ Total equity

Year 2013: 7106/ 1217 = 5.83

Year 2012: 5632 / 898 = 6.27

Equity multiplier = Total assets/ Total equity

19

Year 2013: 8223 / 1212 = 6.78

Year 2012: 6530 / 898 = 7.27

Times interest earned ratio = EBIT/ Interest

Year 2013: 1090/ 135 = 8.07

Year 2012:1163/ 114 = 10.20

Cash coverage ratio = EBIT + Depreciation / interest

Year 2013: 1090 + 407 / 135 =11.08

Year 2012:1163 + 262 / 114 = 12.5

So total debt ratios are higher than 50 % and debt- equity ratio more than 1 in 2012 and 2013;

these show that company is growing in its industry. Moreover, Campbell Soup Company has the

capacity to use debt financing in its operation because it can cover its interest expense many

times over. However, this ability is not good in 2013 compared to 2012.

c. Profitable ratios

Profit margin = Net income / Total assets

Year 2013:458/ 8052 = 0.05

Year 2012:774/ 7175 = 0.10

Return on assets (ROA) = Net income / Total assets

Year 2013:458/8232= 0.05

Year 2012: 774/ 6530= 0.11

Return on equity (ROE) = Net income / Total equity

Year 2013: 458/ 1217 = 0.37

Year 2012: 774/898 = 0.86

ROE = Net income/ Sales x Sales / Assets x Asset / Equity

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Year 2013: 458/8052 x 8052/8323 x 8323/1217 = 0.37

Year 2012: 74/7175 x 7175/6530 x 6530/898 = 0.86

Over view, Campbell Soup Company is generating 10 cents in 2012 and 5 cents in 2013 of profit

from every sales dollar. Besides, the assets of company are generating 11 cents in 2012 and 5

cents 2013 per investment dollar. In addition, the firm returned more than 80% in 2012 and 30%

in 2013 to owners. To sum up, the company turns sales and assets into income decrease from

2012 to 2013.

IX) SWOT ANALYSIS

SWOT Analysis is a strategic planning tool used to evaluate the Strengths, Weaknesses,

Opportunities, and Threats inside a company, project, or a business venture. It involves

identifying the internal and external factors that are favorable/ unfavorable for business to

succeed

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SWOT

STRENGTHS

Focus on the powerful brands in three main categories: Soup & Simple Meals, Snacks and Healthy Beverages

A leading food producer in the U.S, had a presence in approximately 85%.

Campbell’s products are sold in 120 countries around the globe

Stable capital with strong balance sheet and net income.

Innovate and cultivate the quality of product and service that is relevant to

community health such as salt- reduction push was one of the company’s biggest initiatives of the past decade.

Creating a good image in consumer’s mind by their product commitment to

community health to help combat childhood obesity and high blood pressure

in America

Strong social responsibility into protect

environment activities or community organizations.

WEAKNESSES

Less products content low sodium and sugar that influence to healthy image.

Gross margins were impacted by

economic crisis before 2011.

Highly competitive soup market

Beverages and snack brands isn’t popular

so sales is mostly affected by soup brands.

The leadership and strategies may not achieve the best effectiveness.

OPPORTUNITIES

Expanding its international presence,

particularly in emerging markets

Developing relevant technological

advances to improve the quality of products.

Motivating the contribution of consumer about Campbell’s products.

Studying to find out other various products in order to meet the preference of

customer

Expanding its healthy beverages and

baked snacks brands.

THREATS

Marketing and advertise costs is high that

influence to price of products.

Many competitors in the soup market.

The demand and preference of consumers is very hard to predict

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Strengths:

Campbell Soup Company was developed bases on three core categories: Soup & Simple

Meals, Snacks and Healthy Beverages, so their products have been rated best as well as

have a strong background.

According to main official website, Campbell is a global reputation company in U.S.

Furthermore, it develop rapidly and expand brands all around the world dramatically (120

countries).Therefore, it gets the belief of customers, partners and have a strong position in

the market.

Based on the income statement and balance sheet, it has stable capital so it can maintain

the business operations and be able to overcome the risks unanticipated.

Good technology and cultivation to make product that fulfil the customers health and

nutrition

Social and community activities contribute to create the good image and trust of consumers

Weaknesses:

Although developing of technology, fastidious customers aren’t still satisfied and require

products which has much lower sodium and sugar.

The less time people cook at home, the more packaged food people need. It lead to high

competition.

According to Case 32, the strategies of CEO is not achieve the best effectiveness.

Opportunities:

Through the strengths and weaknesses, we have opportunities be able to apply to develop

business operation in future. Thanking to the strong brand name and package food

preference of consumer, Campbell has huge chances to extent worldwide. Moreover, the

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innovation of technologies improves the productivities as well as make the standard of

products.

Threats:

Because of highly competitive market it has some risks such as price, unpredicted of

consumer and sales.

X) PRODUCT LIFE CYCLE

According to Film Structure and Management on Case 32 “Campbell: Is the soup still

simmering?”, the information which is provided in fiscal 2011, building on the success of the V8

V-Fusion juice offering, the company planned to introduce a number of new V8 V-Fusion Plus

Tea products. As a result, Campbell product V8 V-Fusion is in Growth Stage in the life cycle.

In 2010, there were 7 main strategies, but just only three of them motivate V8 V-Fusion to

develop in 2011. These are deliver higher levels of consumer satisfaction through superior

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innovation focused on wellness while providing good value, quality, and convenience; grow its

icon brands within simple meals, baked snacks , and healthy beverages; and making its products

more broadly available and relevant in existing and new markets, consumer segments and eating

occasions.

However, from the chart and Net Income Statement above, we see that the net income went

down slightly from 2011 to 2013, specially is from 2012 to 2013. Because package foods market

has many competitors over times that lead to few new consumers, this market becomes saturated.

Thus, we identify products are in maturity stage. This is also the problem that company must to

consider.

Some recommendations that Campbell can take to improve the performance of its core soup

business include:

Improving and developing a new marketing campaign such as advertising and SNS to

attract new consumers and remain potential customers’ purchases.

Motivating R&D department to develop new flavors that satisfy people who care about

flavors as well as health-conscious individuals.

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XI) CPM – COMPETITIVE PROFILE MATRIX

Nestle General Mills Kraft Foods Heinz Company

Critical Success Factors Weight Rating Score Rating Score Rating Score Rating Score

Brand reputation 0.13 4 0.52 2 0.26 1 0.13 3 0.39

Level of product

integration 0.08 4 0.32 3 0.24 2 0.16 1 0.08

Range of products 0.05 3 0.15 1 0.05 2 0.10 4 0.2

Successful new

introductions 0.04 3 0.12 2 0.08 2 0.08 4 0.16

Market Share 0.14 3 0.42 1 0.14 2 0.28 4 0.56

Sales per employee 0.08 2 0.16 3 0.24 2 0.16 3 0.24

Low cost structure 0.05 4 0.20 2 0.10 1 0.05 3 0.15

Variety of distribution

channels 0.07 4 0.28 2 0.14 2 0.14 4 0.28

Customer retention 0.02 3 0.06 2 0.04 3 0.06 4 0.08

Superior IT capabilities 0.11 3 0.33 4 0.44 2 0.22 3 0.33

Strong online presence 0.15 3 0.45 2 0.30 2 0.30 4 0.60

Successful promotions 0.08 4 0.32 2 0.16 2 0.16 4 0.32

Total 1.00 - 3,33 - 2.19 - 1,84 - 3,47

As a result, the strongest performer in the market should be Heinz Company (3.47 point), and the next

competition is Nestle with 3, 33 point. In addition, the weakest company is Kraft Food (1, 84 point).

Specifically, they have a strong position for a long time and suppose strategies efficiently as well as

implement smoothly. Thus, they also create an extremely competitive market and risks to Campbell

Soup Company.

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Rational

Nestle has the strongest reputation which is designed base on building trust and supporting with the

universal public worldwide.8 Nestle was the number one food company for sale in the world.

Moreover, Nestle is the world leader in coffee (Nescafe). It has many famous global brands included

Buitoni, Friskies, Maggi, Nescafe, and Nestle. It occupy 31% domestic market share9 and always has

successful promotions10

Besides, Heinz Company also is one of the world’s largest food producers with thousands of products.

They produce ketchup, condiments, sauces, frozen foods, bean, pasta meals, infant foods and other

processed products. Moreover, its well- known products was ketchup and it is the outstanding

company in the U.S ketchup market .In addition, it also use social network service wisely to launch its

products successful.11 Heinz’s products enjoy first or second place by market share about 50 countries

but it still lower than Campbell Soup Company.

General Mills is the second cereal marker in the US and it covers over 100 countries.12 It has some

reputation brands such as flour (Gold Medal), baking mixes (Betty Croker, Bisquick), dinner mixes

(Hamburger Helper), fruit snacks (Fruit Roll-Ups), grain snacks (Chex Mix, Pop Secret ) and yogurt

8 Nestlé named one of the world's top ten most reputable companies. (2013, April 3). Retrieved August 30, 2014,

from http://www.nestle.com/Media/NewsAndFeatures/RepTrak-study-2013 9 Sara Lee International and Domestic Market Share and Market Score (n.d.). Retrieved August 29, 2014, from

http://amandapaynemba.wordpress.com/2012/03/27/sara-lee-international-and-domestic-market-share-and-market-

score/ 10 Nestlé chocolate promotion tastes sweet success with Payne tape (n.d.). Retrieved August 29, 2014, from

http://www.foodanddrinknews-online.net/2012/nestle-chocolate-promotion-tastes-sweet-success-with-payne-tape/ 11 KIM BHASIN. (2011, October 27). Why Heinz Is Hyping Up Its Fancy New Ketchup with A Facebook-Only

Launch Read more: Http://www.businessinsider.com/heinz-ketchup-facebook-launch-2011-10#ixzz3BrabHX8t.

Retrieved August 29, 2014, from http://www.businessinsider.com/heinz-ketchup-facebook-launch-2011-10 12 Creating shareholder value (n.d.)Retrieved August 29, 2014, from http://phx.corporate-

ir.net/phoenix.zhtml?c=74271&p=irol-irhome

27

(Colombo, Go-Gurt, and Yoplait).13 Besides, the development of technology causes its strong online

presence in the market.14

Kraft Foods is new company so its reputation is not high, but it is the fourth- largest packaged-foods.15

On the contrary, it brings the good customer service for consumers and it try to improve its technology

to keep up with the changing of market.16

XII) EXTERNAL FACTOR EVALUATION MATRIX (EFE)

Opportunities Weight Rating Weighted Score

1 Expanding its international presence, particularly in the

demand of emerging markets 0.15 4 0.60

2 Developing relevant technological advances to improve

the quality of products 0.11 3 0.33

3 Motivating the contribution of consumer about

Campbell’s products. 0.08 2 0.16

4 Studying to find out other various products in order to

meet the preference of customer 0.13 3 0.39

5 Expanding its healthy beverages and baked snacks

brands as well as social responsibility. 0.13 3 0.39

Threats Weight Rating Weighted Score

1 Marketing and advertise costs is high that influence to

price of products. 0.11 2 0.22

2 Many competitors in the soup market. 0.15 4 0.60

3 The demand and preference of consumers is very hard

to predict 0.14 3 0.42

TOTALS 1.0 3.11

13 Dess, Lumpkin, & Eisner (n.d.) Case 32: Campbell- Competition. In Strategic Management (p. C240) 14 Ann Meyer (n.d.) Powering Up Innovation at General Mills. Retrieved August 29, 2014, from

http://www.retailleader.com/article-powering_up_innovation_at_general_mills_-2669-part1.html 15 Top 9 Most Disliked U.S. Companies: 2012. (2012, February 21). Retrieved August 29, 2014, from

http://www.thinkadvisor.com/2012/02/21/top-9-most-disliked-us-companies-2012 16 About Kraft Foodservice (n.d.). Retrieved August 29, 2014, from

http://www.kraftfoodservice.com/about/aboutkraft.aspx

28

The average weighted score for EFE matrix is 3.11 Campbell soup company. The company total

weighted score higher than 2.5 is consider as strong in position. As the results shows that

Campbell soup Company is responding above average to the environment for exploiting

opportunities and to overcome threats.

Rational

Opportunities:

Expanding its international presence, particularly in the demand of emerging markets:

Although Campbell sales are still predominantly America based, they now have operating

segments in Canada, Mexico, Brazil, Germany, Sweden and China. These countries now

have sizable every class in communities with access to Campbell products and the

potential sustained demand for Campbell's products.17

Developing relevant technological advances to improve the quality of products.

Campbell improves production lines to maximize company profitability and

competitiveness significantly.18

Motivating the contribution of consumer about Campbell’s products.

17 Katje, C. (n.d.). Campbell's Justifies High P/E With Acquisitions And International Growth. Retrieved August 29,

2014, from: http://seekingalpha.com/article/1509292-campbells-justifies-high-p-e-with-acquisitions-and-

international-growth 18 Gelski, J. (2014, May 3). New technologies heating up for soup industry. Retrieved August 29, 2014, from

http://www.foodbusinessnews.net/articles/news_home/Research/2014/03/New_technologies_heating_up_fo.aspx?I

D=%7BA980A3FC-A947-4729-8064-442E1942B3BE%7D

29

Because of fierce competitive environment, so we are always receptive to customer

feedback. Thereby, it helps us to stand firm in the market.19

Studying to find out other various products in order to meet the preference of customer.

Nowadays, the dining demand of customers are very various as well as the desire in the

facility of food in daily life. Hence, the more we develop our product, the more we fulfill

the need of customers.20

Expanding its healthy beverages and baked snacks brands as well as social responsibility.

Campbell is not only creating better goods for customer’s heath, but also contributing a

major role for the community to continue to maintain a good image to customers.21

Threats

Marketing and advertise costs is high that influence to price of products.

Continued slow economic growth here in the US and globally may slow their sales, and

lower expected profits from Hershey Food Investments. This could in turn put pressure

19 Campbell Soup Company heats up customer satisfaction with QlikTech. (2007, May 21). Retrieved August 29,

2014, from http://www.businesswire.com/news/home/20070521005084/en/Campbell-Soup-Company-Heats-

Customer-Satisfaction-QlikTech#.VAGfEfl_u1Q 20 Keith Nunes. (2014, March 17). Inside Campbell Soup’s product development process. Retrieved August 29,

2014, from

http://www.foodbusinessnews.net/articles/news_home/Consumer_Trends/2014/03/Inside_Campbell_Soups_product

.aspx?ID=%7BF867E0F6-F5A1-4D86-BF76-F71D75429A3D%7D 21 Sr. Manager - Customer Quality. (2014, July 3). Retrieved August 29, 2014, from

http://www.linkedin.com/jobs2/view/16649907

30

on the company to decrease costs by cutting personnel, investments in manufacturing,

research, development and marketing of their products.22

Many competitors in the soup market.

High-Rivalry among Campbell’s competitors is high and includes very large

conglomerates such as Heinz, Nestle, General Mills and Kraft Foods. These companies

compete through very well-known brands and globally. They compete not only for space

right next to Campbell's products on the store shelf but also in most every place

Campbell's products can be found. These companies are well established and can

compete both on price and product variety.23

The demand and preference of consumers is very hard to predict.

Many buying decisions require predictions of another person's product attitudes. Yet,

consumers are often inaccurate predictors, even for familiar others. We provide strong

evidence that target familiarity can even hurt accuracy in the presence of attitude

feedback. . When presented with product-specific attitude feedback, predictors adapted

their level of projection and encoded the attitude information, but they did not use this

information. Instead, they retrieved less diagnostic, pre-stored information about the

familiar target stop redirect their product attitudes24

22 Marketing problems affect Campbell Soup Company. (n.d.). Retrieved August 29, 2014, from

http://www.ukessays.com/essays/marketing/marketing-problems-affect-campbells-soup-company-market ing-

essay.php 23 Dess, Lumpkin, & Eisner. (n.d.). Case 32. In Strategic Management. 24 Monica Watrous. (2013, November 20). Campbell hopes to hit with Hispanic consumers. Retrieved August 29,

2014, from

31

XIII) INTERNAL FACTOR EVALUATION MATRIX (IFE)

Strengths Weight Rating Weighted Score

1 Focus on the powerful brands in three main categories:

Soup & Simple Meals, Snacks and Healthy Beverages 0.05 3 0.15

2 A leading food producer in the U.S had a presence in

approximately 85%.

0.07 4 0.28

3

Campbell’s products are sold in 120 countries around

the globe 0.06 4 0.24

4 Stable capital with strong balance sheet and net income. 0.10 4 0.40

5

Innovate and cultivate the quality of product and service

that is relevant to community health such as salt-

reduction push was one of the company’s biggest

initiatives of the past decade.

0.12 3 0.36

6

Creating a good image in consumer’s mind by their

product commitment to community health to help

combat childhood obesity and high blood pressure in

America

0.13 4 0.52

7 Strong social responsibility into protect environment

activities or community organizations. 0.11 3 0.33

http://www.foodbusinessnews.net/articles/news_home/Business_News/2013/11/Campbell_hopes_to_hit_with_His.a

spx?ID=%7B170BDD42-EC08-4352-96F4-A832881CC5AF%7D

32

Weaknesses Weight Rating Weighted Score

1

Less products content low sodium and sugar that

influence to healthy image. 0.03 2 0.06

2

Gross margins were impacted by economic crisis before

2011. 0.03 2 0.06

3 Highly competitive soup market 0.09 1 0.09

4

Beverages and snack brands isn’t popular so sales is

mostly affected by soup brands. 0.09 1 0.09

5

The leadership and strategies may not achieve the best

effectiveness. 0.12 1 0.12

TOTALS 1.00 2.7

The average weighted score for IFE matrix is 2.7 Campbell soup company. The company total

weighted score higher than 2.5 is consider as strong in position. As the results shows that

Campbell Soup Company’s internal position is better.

Rational

Strengths:

Focus on the powerful brands in three main categories: Soup & Simple Meals, Snacks

and Healthy Beverages.

33

Because of the convenience and time savings, so the demands of package- foods are used

widely in the market. Therefore, these items can easily be received and have increasingly

trended.25

A leading food producer in the U.S had a presence in approximately 85%.

The effective strategies and clear management that make Campbell Soup Company

become the important position in U.S market and go beyond other competitors.26

Campbell’s products are sold in 120 countries around the globe.

Diversification of products help customers more options and to attract more new

customers. Reforms that help catch market changes and develop business flexibly.27

Stable capital with strong balance sheet and net income.

Although the economy is more volatile due to the financial situation which is unstable,

Campbell still maintain good profits and other expenses.28

Innovate and cultivate the quality of product and service that is relevant to community

health such as salt- reduction push was one of the company’s biggest initiatives of the

past decade.29

25 Dess, Lumpkin, & Eisner. (n.d.). Case 32: Campbell- Industry Overview. In Strategic Management. 26 Joe Cooney. (2014, August 21). Could Camden's Campbell Soup be next big takeover candidate?

Retrieved August 29, 2014, from

http://www.courierpostonline.com/story/money/business/2014/08/21/could-camdens-campbell-soup-

be-next-big-takeover-candidate/14385823/

27 Monica Watrous. (2014, April 23). Campbell advancing sustainability, nutritional goals. Retrieved

August 29, 2014, from http://www.foodbusinessnews.net/articles/news_home/Business_News/2014/04/Campbell_advancing_sustainabil.aspx?ID=%7BE8CB0B1D-3460-4A4D-BCF3-05648FEAFA82%7D 28 Campbell's Profit Heats Up on Strong Soup Sales. (2013, May 20). Retrieved August 29, 2014,

from http://www.dailyfinance.com/2013/05/20/campbell-soup-earnings/

34

Creating a good image in consumer’s mind by their product commitment to community

health to help combat childhood obesity and high blood pressure in America.30

Strong social responsibility into protect environment activities or community

organizations.31

Weaknesses

Less products content low sodium and sugar that influence to healthy image.

It leads to the negative aspect for consumer and the sales may be effect.32

Gross margins were impacted by economic crisis before 2011.

Highly competitive soup market

The adjustment prices of competitors cause the confusion for the consumer in selection of

Campbell’s product.

Beverages and snack brands isn’t popular so sales is mostly affected by soup brands.

29 Campbell's adding salt back to its soups. (2012, September 6). Retrieved August 29, 2014,

from http://www.theglobeandmail.com/life/health-and-fitness/campbells-adding-salt-back-to-its-soups/article587037/ 30 RICARDO LOPEZ. (2014, January 9). Food, beverage firms remove 6.4 trillion calories from

products. Retrieved August 29, 2014, from http://articles.latimes.com/2014/jan/09/business/la-fi-mo-food-beverage-firms-remove-64-trillion-calories-from-products-20140109 31 CAMPBELL GIVES AMERICA’S KITCHEN PANTRIES A HEART-HEALTHY MAKEOVER WITH

THE LAUNCH OF THE “ADDRESS YOUR HEART PANTRY PROJECT”. (2014, February 6). Retrieved August 29, 2014, from 31 CAMPBELL GIVES AMERICA’S KITCHEN PANTRIES A

HEART-HEALTHY MAKEOVER WITH THE LAUNCH OF THE “ADDRESS YOUR HEART PANTRY PROJECT” 32 Scott- Thomas, C. (2011, July 13). Campbell's adding salt back to its soups. Retrieved August 29,

2014, from http://www.foodnavigator-usa.com/Suppliers2/Campbell-s-to-add-back-sodium-to-combat-soup-sales-slump

35

Campbell Soup Company should concentrate on beverage and snack brand more to

improve the sales as well as its reputation.

The leadership and strategies may not achieve the best effectiveness.

Giving specific strategies and training employees to help company overcome the difficult

problems.

XIV) SPACE MATRIX

Internal Strategic Position External Strategic Position

Financial Strength (FS): 1 to 6 Industry Strength (IS): 1 to 6

1 ROI33 5 Growth potential

1 Liquidity34 4 Profit potential35

4 Working Capital 2 Financial stability

6 Cash Flow 5 Technological know-how

5 Resource utilization

2 Ease of entry into market

4 Productivity, capacity utilization

Average: 3 Average: 3.86

Total axis X core 2.53

Competitive Advantage (CA) -1 to -6 Environment Stability (ES) -1 to -6

-1 Market share -1 Technological changes

-1 Product quality -2 Demand variability

-2 Product life cycle -2 Price range of competing products

-2 Customer loyalty -1 Barriers to entry

33 CPB's ROI over the last five Years. (n.d.). Retrieved August 30, 2014, from http://csimarket.com/stocks/CPB-Annual-Return-on-Investment-ROI.html 34 Industry Information. (n.d.). Retrieved August 30, 2014, from http://www.advfn.com/exchanges/NYSE/CPB/financials 35 Food Processing's Top 100. (n.d.). Retrieved August 30, 2014, from

http://www.foodprocessing.com/top100/top-100-2013/

36

-1 Brand and Image -1 Competitive pressure

-1 Know-how -1 Risk involved in business

Average: - 1.33 Average: -1.33

Total axis Y core 1.67

The Strategic Position and Action Evaluation (SPACE) Matrix is one of the strategic

management tool for analyzing the company and its environment to formulating the strategies. It

is four-quadrant structure which specify whether aggressive, defensive competitive or

conservative strategies are most suitable for a given organization, company or business.

The significant factors in SPACE matrix assess that Campbell’s financial performance for

instance liquidity, cash flows, working capital and return on investment (ROI) have financial

strength for business activities.

AGGRESSIVE CONSERVATIVE

DEFENSIVE COMTETITIVE

4

3

2

1

4

3

2

1

X

Y

(2.53; 1.67)

37

Campbell Soup Company’s directional vector is located in the aggressive area (2.53 X; 1.67 Y in

upper-right quadrant) of the matrix, it shows that a firm is in an outstanding position to utilize its

strengths to surmount weaknesses, obtain the advantage of opportunities in order to avoid

threats.

As a result, Campbell Soup Company should focus on aggressive strategy because it has strong

competitive position in package food industry. Company need to use their strengths in order to

direct to market development, market penetration, product development, forward, backward and

horizontal integration, conglomerate and horizontal diversification or a mix of strategies.

XV) GRAND MATRIX

38

According to Case 32 “ Campbell: Is the soup still simmering ?” and the information which we

used to research, we realize that the US Packaged- food industry recorded faster current value

growth in 2012 than it did in 2010. Moreover, product of Campbell is at the development stage

such as V8 Beverage. To sum up, Campbell Soup Company has strong competitive position in

strong growth market, so it belongs to Quadrant II.as well as STARS in BCG.

THE BOSTON CONSULTING GROUP (BCG) PORTFOLIO MATRIX

Campbell's U.S. Soup, Sauces and Beverages (48% sales, 64% income) are the main categories

to earn revenues and operating income. U.S. Soup, Sauces and Beverages include products such

as Campbell’s condensed and packaged soups; Swanson broth and canned poultry; Prego pasta

sauce; Pace Mexican sauce; Campbell’s Chunky chili; Campbell’s canned pasta, gravies, and

48% 26%

18.5%

7.5%

Market growth

Rate

High

Low

Relative Market share Low High

Stars

Cash Cows Dogs

Question Marks

39

beans; Campbell’s Supper Bakes meal kits; V8 juice and juice drinks as well as Campbell’s

tomato juice. The company's 2010 market share in the "wet soup" market was 63.6%.

Campbell's Baking and Snacking categories (26% sales, 22% income) includes, Pepperidge Farm

cookies, crackers (such as goldfish), bakery, and frozen products in U.S. retail. The segment also

includes Campbell's Arnott’s of Australia which is the largest biscuit and second largest snack

producer in the country. Arnott's also has significant presences in the Asia Pacific region.

The International Soup, Sauces and Beverages categories (18.5% sales, 11% income) includes

the soup, sauce and beverage businesses outside of the United States, including Europe, Mexico,

Latin America, the Asia Pacific region and the retail business in Canada. Campbell's sells the

Erasco and Heisse Tasse soups in Germany, Liebig and Royco soups in France, Devos Lemmens

mayonnaise and cold sauces and Campbell’s and Royco soups in Belgium, and Bla Band soups

and sauces in Sweden. In Asia Pacific, the company markets its Campbell’s soup and stock,

Swanson broths and V8 beverages. In Canada, operations include Habitant and Campbell’s

soups, Prego pasta sauce, V8 beverages and certain Pepperidge Farm products.

The North America Foodservice (7.5% sales, 3% income) includes Campbell's Away From

Home operations which distributes its products to restaurants, schools, colleges & universities,

health care, convenience stores, vending, and delis in the United States and Canada.36

36 Campbell Soup Company (CPB). (2014, August 29). Retrieved August 30, 2014, from

http://www.wikinvest.com/stock/Campbell_Soup_Company_(CPB)

40

37

Some strategies which is recommended:

Market development: spreading the power and perceived about Campbell’s product in the

available markets by improving and focusing on Marketing and Advertising to remain the

position. In addition, Campbell carries out a plan to develop market such as diversifying products

which appropriate customer segments. For example, the promotion is buy 4 soup cans get 1

comic or reducing a product price to motivate demands.

37 Campbell Soup - defensive is not so defensive any more. (2013, November 19). Retrieved August 30,

2014, from http://financialorbit.blogspot.com/2013/11/campbell-soup-defensive-is-not-so.html

41

Market penetration: seeking and studying the new potential markets such as South East ASIA,

and understanding sociocultural and taste in order to devise some strategies for the awareness of

customers about Campbell’ s brand.

Product Development: innovating the quality and flavor of products.

Forward integration: purchasing the companies which are going to bankrupt and then investing

to expand the scale of company.

Backward integration: purchasing of suppliers to cut transportation costs, improve profit

margins and make the firm more competitive.

Horizontal integration: exchanging and cooperating with competitor to create outstanding

products.

Related diversification: diversifying products by growing new brands such as porridge can and

instant noodles.

42

XVI) QUANTITIVE STRATEGIC PLANNING MATRIX (QSPM)

Problem: Company are facing detrimental situation in business, specifically it is not growing in

recent year and even it have decrease trend in the future.

CAMPBELL SOUP COMPANY

Key Internal Factor Weight

Market Penetration Market Development Product

Development

OPPORTUNITIES AS TAS AS TAS AS TAS

Expanding its international presence,

particularly in emerging markets 0.15 2 0.30 3 0.45 2 0.30

Developing relevant technological

advances to improve the quality of

products

0.11 2 0.22 1 0.11 2 0.22

Motivating the contribution of

consumer about Campbell’s products 0.08 4 0.32 3 0.24 4 0.32

Studying to find out other various

products in order to meet the preference

of customer

0.13 4 0.52 4 0.52 3 0.39

Expanding its healthy beverages and

baked snacks brands. 0.13 3 0.39 2 0.26 3 0.39

THREATS

Marketing and advertise costs is high

that influence to price of products. 0.15 3 0.45 4 0.60 1 0.15

Many competitors in the soup market. 0.11 3 0.33 2 0.22 3 0.33

The demand and preference of

consumers are very hard to predict 0.08 3 0.24 4 0.32 3 0.24

TOTAL 1.00 2.77 2.72 2.34

STRENGTHS

Focus on the powerful brands in three 0.05 1 0.05 3 0.15 3 0.15

43

main categories: Soup & Simple Meals,

Snacks and Healthy Beverages

A leading food producer in the U.S had

a presence in approximately 85%. 0.07 2 0.14 4 0.28 1 0.07

Campbell’s products are sold in 120

countries around the global 0.06 1 0.06 3 0.18 1 0.06

Stable capital with strong balance sheet

and net income 0.10 3 0.30 4 0.40 2 0.20

Innovate and cultivate the quality of

product and service that is relevant to

community health such as salt-

reduction push was one of the

company’s biggest initiatives of the

past decade

0.12 3 0.36 4 0.48 4 0.48

Strong social responsibility into protect

environment activities or community

organizations

0.11 4 0.44 4 0.44 1 0.11

Creating a good image in consumer’s

mind by their product commitment to

community health to help combat

childhood obesity and high blood

pressure in America

0.13 4 0.52 4 0.52 1 0.13

WEAKNESSES

Less products content low sodium and

sugar that influence to healthy image 0.03 3 0.09 2 0.06 4 0.12

Gross margins were impacted by

economic crisis before 2011 0.03 1 0.03 1 0.03 1 0.03

Highly competitive soup market 0.09 4 0.36 4 0.36 3 0.27

44

Situation: According to income statement of Campbell Soup Company from 2010 to 2012 and

the information that we research, showed that the stock fell 5% after Campbell said its fiscal

second-quarter earnings fell 8% from a year ago. Moreover, the company chopped its outlook for

the rest of the year and warned profits are likely to slip another 1% to 3% for the full year.

Hence, it faces a slowdown in net income. As we can see the current problem of Campbell Soup

Company, we propose 3 most necessary strategies, included market development, market

penetration and product development in this time in order to overcome a slowdown profit

situation.

Decision: According to QSPM, Market Development is better because the Market Penetration

(5.63) is lower than the Market penetration (6.19). We decide to direct the new potential markets.

Strategies:

o Researching the cultural, demand and preference of market.

o Choosing the suitable products and flavor to meet customer satisfaction for each region

Beverages and snack brands isn’t

popular so sales is mostly affected by

soup brands.

0.09 3 0.27 1 0.09 4 0.36

The leadership and strategies may not

achieve the best effectiveness. 0.12 2 0.24 4 0.48 1 0.12

TOTAL 1.00 2.86 3.47 1.99

SUM TOTAL ATRACTTIVENES

SCORE

5.63

<

6.19

>

4.33

45

o Consider the form of advertising such as SNS, Television, and Magazine…

o Adjusting the price of products.

o Design advertisements, events and promotions to attract the customer’s attention:

Design an event to attract customers come to and savor various products

Set the happy days to increase purchasing capacity. These happy days are Monday or

Wednesday because less consumers go to supermarket on these days.

Making competitive event to gain the prize on SNS by appealing customers to take the

picture with packages.

Sponsoring social activities to create the good image in new customers.

Emphasizing the strength of reputation and the differences of products in advertising to

make the consumer’s trust.

o Improving customers care, building the close relationship with customer and encouraging

the consumer’s feedback.

After the implementation of the strategy:

Collecting feedbacks and reassess the strategies, we will continue if it is successful.

Analysis QSPM:

Through information in Case 32 and main official website, we see that the package food is

thriving and Campbell Soup Company is one of the companies that have strong competitive

position in this industry. Hence, we devise two the most important strategies: Market

Development and Market Penetration in order to Campbell can understand, solve problem and

open new ways in business as they can. Besides, to choose which the better strategy is we

evaluate each element in SWOT Analysis.

46

In conclusion, through QSPM we can identify the market development is more attractiveness

than market penetration. The new strategy helps Campbell company can solve the current

problem (income is not growing in recent years) and orienting the development in future

permanently.

XVII) RECOMMENDATION

Long- term strategy

Due to current statuses of company and market and the matrix tables, Campbell Soup Company

should consolidate and direct to the new potential markets such as: international presence and

stable financial situation in incomes and expenses.

Specific strategy:

International presence (from 1 years 3 months to 1 years 6 months)

Having plans to open at least 1 factory at Vietnam, Thailand and Czech Republic.

Setting up marketing campaign suitable for each country.

Developing new products for each country.

Hiring CEO or board of directors who are local people.

Making event for opening to attract consumer’s attention.

Stable financial situation in incomes and expenses (annual):

Reducing labor in necessary.

Selecting prestige local suppliers to reduce the material costs.

Inviting customers to join in advertising to reduce costs and built the trust.

Set the happy hours to increase purchasing capacity.

47

Training employees and improving customer service relentlessly to attract customers so

that employees work in a standard “the customer is always right”.

XVIII) TIMETABLE

Strategies Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun …

International presence strategy

Building factories (research

position, hiring or buy land…)

Hiring CEO or board of directors

Developing new products (research culture and flavor )

Setting up marketing

campaign

Making event for opening

Stable financial situation in incomes and expenses strategy

Selecting prestige local suppliers

Inviting customers to join in advertising

Set the happy hours

T raining employees and improving customer service