Cadbury’s Oreo is a popular brand of cookie biscuits which consist of a layer of white cream stuffed between two chocolate flavored cookies. The cookies that are manufactured by the confectionery major Cadbury’s is very popular amongst kids. The company felt that the cookies may not be able to get a market for itself which is why they decided to associate the cookie with the chocolate brand Cadbury’s.
The cookie is marketed as an ideal combination with milk which in turn has increased its market acceptance. Cadburys in addition to Oreo cookies also owns multiple other brands in various categories of confectioneries like chocolates, milk powders, chocolate syrups, and biscuits. The company is currently owned by Mondelez International which has an annual turnover of more than 3 billion USD. The cookie brand is also now associated with the popular brand of milk chocolates Dairy Milk under the label Dairy Milk Oreo.
Strengths in the SWOT analysis Cadbury’s Oreo
Strengths are defined as what each business does best in its gamut of operations which can give it an upper hand over its competitors. The following are the strengths of Cadbury’s Oreo :
- High Brand equity: Like all other brands associated with Cadbury’s Oreo also has high brand equity and recall. This results in a lot of customers preferring the brand over other cookies.
- Strong association with chocolate: The word Cadbury’s has a strong association with chocolate and thus anything associated with Cadbury’s is also related to chocolate. For the same reason, Oreo is a popular brand of chocolate cookies.
- Widespread distribution: In most of the markets that Cadbury’s Oreo is sold in the brand has a widespread distribution channel and it reaches out into even remote locations and villages ensuring that the brand has the wide reach.
- Worldwide market: Cadbury’s is sold in almost all countries of the world and this uses the same network to sell the cookies across the globe. The company has around 2100 distributors and 4,50,000 retailers in its network helping the brand to reach across the world. It has the presence in more than 95 countries across the world.
- Strong Communication: Cadbury’s Oreo has been trying to reach out to a customer across the world through the slice of life ads showcasing both the taste and the emotion associated with the biscuit. The brand showcases family and relationships in its advertisements and does not rely on endorsements.
Weaknesses in the SWOT analysis Cadbury’s Oreo
Weaknesses are used to refer to areas where the business or the brand needs improvement. Some of the key weaknesses of Oreo cookies are:
- High cost of raw materials: The primary raw material in Oreo cookies is chocolate and all Cadbury’s products use high-grade cocoa which is very expensive. The cost of the raw material is growing but the company is unable to increase the product price correspondingly.
- Criticisms: Cadbury’s had to recall some of their products in the American market because of salmonella poisoning. In addition to that, there have also been scandals related to usage of chemicals in the product. This has affected the overall market share and sales of Oreo biscuits.
- Internal competition: Cadbury;’s has other products like Bournvita biscuits and chocolates which eat into the market share of the Oreo biscuits and thereby have low volumes and low margins which in turn affects the profitability.
- Overemphasis on chocolates: Cadburys has always been associated with chocolates and their highest sales come from chocolates. This makes them ignore other confectionery items Oreo cookies being one of them.
- Challenges in differentiation: There are too many biscuit brands available in the market and many of them do not have clear differentiators. This often confuses the customer and that has adversely affected the sales of all the brands.
- The high cost of advertisements: The cost of advertising for Cadburys is high and this cannot be factored into the prices of products. However, since the company depends on impulse for the purchase they cannot afford to cut down on the costs of advertising.
Opportunities in the SWOT analysis Cadbury’s Oreo
Opportunities refer to those avenues in the environment that surrounds the business on which it can capitalize to increase its returns. Some of the opportunities include:
- Growing demand for biscuits: In the confectionery segment the highest growth rate is predicted for biscuits. The demand for chocolates is tipping and this is expected to affect the sales of business positively.
- Steep growth potential in emerging economies: The countries like China and India are seeing a reemergence of trends that were once popular in the West. The emerging economies are now including biscuits in their daily snack regime and this will create an increase in the demand for Oreo.
Threats in the SWOT analysis Cadbury’s Oreo
Threats are those factors in the environment which can be detrimental to the growth of the business. Some of the threats include: