Situation Analysis

Chapter 1 Project Overview

1.1 Introduction

Chupa Chups is basically a lollipop known since 1958. Its founder Enric Bernat used to work at a jam factory "Granja Asturias", after he got the idea of making lollipops, he took the jam company and rename it as "Chupa Chups" and created the first lollipop company.

Chupa Chups start with seven flavours, but as times go by there are even more new flavours such as  grape, apple, orange, cherry, pineapple, lime, peach, banana, blueberry, watermelon, cola, strawberry cream, peach cream, chocolate vanilla, mocca, coffee, and many more. Currently the famous flavour among all of the flavours are cola. Chupa Chups are sold in many shops and available in almost everywhere, they are easily found near the cashier, Chupa Chups are sell on a "tower" stand that holding a lots of Chupa Chups. It was design like this so that children can easy reach the lollipops.

Chupa Chups colours are meant to be playful, freshness, happy, youth. Basically the overall design of the chupa chups are playful, the flow and the shape that on the wrapper shows the playfulness of the chupa chups. Most of the colour used are bright and striking colour stand for happiness and freshness, the wrapping itself shows the element of youth by combining the colour of usage and the design applied on.

1.2 Problem statement and Issues

Lack of advertising through different media in Malaysia which causes Malaysian are not well aware of the brand itself.

1.3 Objectives and Aims

Objectives
- To create awareness to the public

- To build up trust towards their brand

- To get people know that Chupa Chups is worth their money for such tasty lollipop

Aims

- People will be more aware about the brand
- To attract more consumers

Chapter 2 Project Profile

2.1 Product name

Chupa Chups

2.2 Product Classification

Chupa Chups is basically a round  type lollipop and available internationally, fall under food and beverages category

2.3 Product Characteristics

- Is a round lollipop
- Each lollipop cost around RM0.70
- The colour used for packaging is happy
- Design of the packaging is playful
- Come in 3 sizes

2.4 Product range

Have 3 sizes

•Mega                  - Apple, Apple tropical, Cola, Cola Lemon, Strawberry, Strawberry Kiwi, Pineapple fresh                                                  drink
•Normal              - Apple, Cola, cherry, Raspberry, Strawberry yogurt, Cola Lemon, Kiwi Strawberry                                              Orange, Lemon Lime, Mango Strawberry Banana, Mango yogurt, Mango pineapple                                           kiwi, Orange, Raspberry Vanilla, Strawberry, Watermelon, Vanilla, Vanilla Chocolate,                                  Stawberry Cream, Cocoa Vanilla, Melon yogurt, Blueberry, Grape, Mango, Peach,                                              Pineapple, Coffee, Blackberry

•Small                   - Apple, Cherry, Cola, Citric Strawberry, Citrus, Orange, Strawberry

2.5 Distribution
The distribution of Chupa Chups can be both direct and indirect. For example on the hypermarket, Chupa Chups can be found on the candy section, and is mostly in sell in packs, unlike those normal Chupa Chups that can be found beside the cashier which is indirect, sometimes people feel like grabbing something to chew or lick, they can get their Chupa Chups near the cashier, when the distribution is indirect, they are targeting people who are waiting to make their payment or children who was bored of waiting.

2.6 Product cycle

2.7 The Brand

Chupa Chups comes originally from the Spanish verb “chupar” which means “to suck”. After 10 years which is 1969, Salvador Dali designed the Chupa Chups logo that is used since then. Brand is very innovation since it keeps on producing new flavours and different type of lollipop like "magics" and bubblegum.

2.8 Brand Image and Implication

International consumers were excited by the promises and the image projected by the brand but the problems lies on local consumers due to lack of exposure. Other brands like Mentos have shown terrific feat in developing and promoting their products and the local consumers expected Chupa Chups to do so. The targeted consumers are not really aware of the brand since they are less expose to Chupa Chups advertising. The products have their own unique characteristics in advertising and appealing.

2.9 Strength and Weakness

•Strength            -Affordable

                                -Light weight
                                -Lots of choices

•Weakness        -Having trouble to unwrap Chupa Chups

                                -People often complain is too sweet

                                -Parents often scare that small kids swallow the plastic stick

                                - Lack of local sales

                                - Lack of local marketing exercise

2.10 Advantages and Disadvantages

•Advantages                     - Low cost manufacturing

                                                -Each lollipop cost not more than RM1.00

                                                -Small in size, easy to carry

                                                -More than 100 kinds of flavours to choose
•Disadvantages                                -Unwrapping Chupa Chups can sometimes be diffcult

                                                -Consuming too much may cause too decay

                                                -Plastic stick is dangerous for kids age under 8

                                               

2.11 Unique Selling Proposition

- More than 100 of flavours to choose including (chewing gums, sugar free lollipops)

- Comes with different sizes

- Is easy and tasty

- An innovation brand

2.12 Promotional History and Advertising Schedule

- Poster
- TVC

- Outdoor

- Concert

- Contest

2.13 Positioning Statement

Chupa Chups is easy to consume since it has stick with it and tasty, current target market is teenagers.

Chapter 3 The Company

3.1 Company Overview

Chupa Chups was the first candy designed with children in mind. Enric Bernat launched the Chupa Chups hoping to create a more practical lollipop for kids. After the end of the Francisco Franco dictatorship the company's founder managed to make his sweets known worldwide. An innovative company as Chupa Chups needed an effective logo to represent it. Most people are quite surprised to find out that the Chupa Chups distinctive daisy logo was designed in 1969 by the famous surrealist Salvador Dali. After Bernat introduced his idea of a more universal logo, Dali needed an hour only to draft on a newspaper what would become the basis for today's Chupa Chups logo. Salvador Dali throughout his later life-time would lend his image to a variety of commercial interests, using himself as a brand. He was the ultimate self publicist, trait which led Breton to nickname him "Avida Dollars" when talking about Dali's later output. The Chupa Chups logo can currently be found on all kinds of lollipops and related items , and the company maintains its focus on creating new, exciting products.

3.2 Business Description

Chupa Chups is a candy company where they sell lollipop as their main products since 1958. In 70's, Chupa Chups appear in Singapore, Philippines and Malaysia market, as well as Australia. In 80's, Chupa Chups expanded to European and North American and in 90s appear almost in all of the Asian countries. In 2003, 4 billion lollipops were sold in 150 different kinds of countries. The company has 2000 emplyees. Chupa Chups believe that their maintain and gain new consumers with their new promotions, campaigns and activities.

 

3.3 Company History

In the early 1950s, Enric Bernat worked for an apple jam factory called "Granja Asturias", when Enric Bernat came up with the idea of "candy on a stick"  which designed for children, who had to settle for sugary gum drops that inevitably lead to sticky hands and dirty clothes, he then took over the company in1958 and renamed it Chupa Chups .
Chupa Chups company was a success. In 5 years Chupa Chups were being sold at 300 000 outlets. When the lollipop was first invented, the sticks were made by wood, but switched to plastic sticks due to Spanish wood shortage. In July 2006, Chupa Chups company was acquired by the Italian group Perfetti Van Melle.

3.4 Key people

Enric Bernat - Founder

Salvador Dali - Logo designer

Raview Bernat Serra - President

Giorgio Maritan - General Manager

Macos Bernat Serra - Vice President

Adrian Romero - Marketing Manager

3.4.1 Key dates

1946: Company starts as Granja Asturias S.A.

 1954: Enrique Bernat joins company, begins development of the lollipop.

 1958: Bernat acquires full control of company, launches Chups brand lollipop.

 1961: Lollipop name is changed to Chupa Chups.

 1964: Company's name is changed to Chupa Chups.

 1967: Chupa Chups forms French subsidiary, opens second production plant in Spain.

 1969: Salvador Dali designs logo; French production facility is constructed.

 1977: Chupa Chups enters the Japanese market.

 1980: Company creates Chupa Chups USA subsidiary.

 1982: Chupa Chups launches German subsidiary.

 1983: Company creates U.K. subsidiary.

 1989: Chupa Chups enters Russian market.

 1991: Company establishes St. Petersburg production facility.

 1992: Chupa Chups unveils Smint line of breath mints for adult market.

 1994: Company creates Chinese subsidiary and production plant.

 1996: Company opens Mexican subsidiary and production plant.

 1998: Brazilian subsidiary is launched.

 1999: Chupa Chups establishes Japanese, Canadian, and Korean sales offices.

 2000: Crazy Planet subsidiary is formed to develop and market non-lollipop products

3.5 Location and Subsidiaries

Principle Subsidiaries

Chupa Chups USA Corp.

Chupa Chups France S.A.

Chupa Chups Diversificacion S.A.

Chupa Chups GmbH (Germany)

Chupa Chups UK Ltd; ZAO Neva

 Chupa Chups (Russia)

Shanghai Chupa Chups Food Co. Ltd. (China)

Chupa Chups Invest Mexico S.A. de C.V.

Chupa Chups Do Brasil Ltda.

Chupa Chups Japan KK

Chupa Chups Canada Inc.

Crazy Planet S.A.

3.6 Brands, Major Products and Services

Chupa Chups is selling Lollipop as their major products, they have their another product like bubblegum and "magics".

3.7 Corporate Vision

- Responsible trading

- Quality & Safety

- Care for people

3.8 Corporate Mission

- Social and environmental responsibility

- Achieving excellence

-Build brand value

- Achieve and maintain satisfied consumers

3.9 Company's Current Promotional Strategy

2009

Life less serious

The commercial being shown through the Asia and Pacific regions. Armed with Chuck ( the mascot for Chupa Chups) trusty Chupa Chups, Chuck has a supernatural ability to go through any situation with an unmatched sense of "unseriousness", including being abducted by a tiny alien spaceship.

2011

"Colour Chupa Chups To Life"
Grand Prize:
iPad, RIO Premiums, 4 TGV Movie Passes and Chupa Chups Hamper

1st Runner Up:
Nintendo Wi, RIO Premiums, 4 TGV Movie Passes & Chupa Chups Hamper

2nd Runner Up:
iPod Touch, RIO Premiums, 4 TGV Movie Passes & Chupa Chups Hamper

Consolation Prize x 20:
RIO Premiums, 2 TGV Movie Passes & Chupa Chups Hamper

3.10 Product Sale's history

3.11 Current Marketing Objective

Long term

- Maintain as the world's top candy brand

- To introduce loyalty program

Short term

- Meet consumer needs

- More promotions needed

3.12 Media Expenditure

Chupa Chups celebrated 50^th anniversary with support MTV. The international performing artists were Katy Perry, The Rasmus and Daniel Powter. The main objective is to build their brand image as a active, cheerful, lively brand and indirectly introducing their brand since there are a lot of famous artists were there to perform.

Chapter 4 Consumers and Stakeholders

4.1 Consumers and Stakeholders

4.1.1 Demographic

Age                                               : 7-24

Gender                                          : Male & Female
Education                                     : Primary and above
Occupation                                   : Kids, Teenager and Young Working adult
Income/ Allowance range            : RM500 and above

Race and Ethnicity                       : All races

Geographical Location                 : Urban & Sub-urban

4.1.2 Psychographics

Perception

-Consumers who enjoy sweets and trendy

-Sweet has become their necessity in their daily life

Learning

-TVC, Internet, Magazines, Flyers, Friends

Motivation

-Product that help consumer to keep track on what's new later on

-Eager to try new products

Attitude

-Cheerful, Explorer

lifestyle

-Modern, Outgoing, Active, Carefree

4.2 Stakeholder's Characteristics

Chapter 5 Industry and Marketplace

5.1 The Industry

5.1.1 Definition of the industry

The industry of candy is based on manufacturing & processing melted sugar with a stick. This all started in 1905, the owner if the McAviney Candy Company. They made boiled hard candies that were stirred with a stick, and at the end of the day, the owner brought the sticks that covered with candy home for his kids to enjoy. in 1908, he began to market these concept as lollipops.

5.1.2 Shape of Industry

Many of the most popular candies are sold in 21th century were develop during 1890 and 1920 by candy makers around united states. Later on many of these candies company were bought and sold many times since they belongs to large company like Mars, Hershey, Warner-Lambert, and Perfetti Van Melle Group.

The first part of the twentieth century marked an explosive period of growth for the candy industry. Tones candies were introduced during this period. Ferrara Pan, a candy company formed in 1919 in Illinois, produced Jaw Breakers, Atomic Fireballs, and Boston Baked Beans. In 1919, the Oh Henry! bar was first manufactured by the Williamson Candy Company of Chicago. Charleston Chews were first sold in 1922 by the Fox-Cross Candy Company near San Francisco, Goobers in 1925 by the Blumenthal Chocolate Company in 1925, and Milk Duds in 1926 by the Holloway Company. During the 1920s and 1930s, the James O. Welch Company introduced several favorites that continue to be sold, including Sugar Daddy, Sugar Babies, Pom Poms, and Junior Mints. Heath Bars, manufactured by the L.S. Heath Company, went on the market in 1932, and Chunky was developed in the mid-1930s by Philip Silverstein.

5.1.3 Development of the Industry

In mid 1990 candy makers also began to introducing seasonal candy. The seasonal candy market posted overall respective dollar and unit volume gains of 10.4 percent and 9.7 percent in 1995. Mars, Hershey, and Nestle didn't join the seasonal candy market, but when candy consumption and sales remained the same, the candy giants capture a major share of the holiday sales. The three companies repackaged many of their most famous candies in pastel colors for Easter. Their entry into the holiday market shoved aside many of the usual holiday candy manufacturers. According to the NCA, Halloween candy had the highest 2008 revenues, with sales of $2.2 billion, followed by Easter with $1.8 billion, Christmas with $1.3 billion, and Valentine's Day with $1.0 billion.

5.2 The Marketplace

5.2.1 Current Marketplace

During 2000, the sales of the candy remained the same. Candy industry shipments fell only slightly in mid 2000, from $17.8 billion in 2004 to $17.2 billion in 2005. According to Census Bureau, united states chocolate and confectionery industry generated $28.9 billion in 2006.

5.2.2 Changes in Marketplace

Positive

- New flavours and products that contain fewer calories or had nutrional benefits.

- Industry are growing as  more and more products are introduce.

- Chewy candy like mentos shows 11% growth rate in 2008.

Negative

- Although candy industry is growing but still lose to chocolate industry

- Too many brands and products are available today, consumer can't remember all of the brands and products

Chapter 6 Competitive and Situation

6.1 Direct Competitors & Indirect Competitors

Durukan

Durukan's 3T Maxi lollipop

Durukan's Choco lollipop

Durukan's Fusion XXL

  Durukan's Sourisssh Lollipop

              

Tien Ming

- Established in 1971, one of the leading manufacturers sweets & candy in Malaysia.

               Blood sucker Lollipop                                          Bloo Pop  

Crystal Lollipop

Animal Lollipop

Indirect competitors

Mentos

Mentos Aqua Kiss

Mentos Chewy Dragees

Mentos Chewy Dragees (pack)

Mentos Bottles

Mini Mentos

Smint

Chapter 7 SWOT Analysis

Strength

- Chupa Chups is second best selling candy in the world

- Chupa Chups comes in different sizes

-Cheap

- Over 100 flavours to choose

- Sugar free products

Weakness

- Causing tooth decays

- Disposal of the stick

- Lack of advertising in Malaysia

- Unattractive packaging

- Lack of brand awareness

- Easy open packaging

- Weak customer relationship

Opportunities

- Introducing sweets product

- Introducing new flavours

- Open a mart that only sells Chupa Chups

- Teenagers like to have sweets as their snacks

- Introducing new packaging

Threads
- Competitive pressures from  other brand like mentos

- Product innovation like Mentos continue to gain market control over Chupa Chups is Malaysia

- Not all places sell Chupa Chups

Chapter 8 Strategic Target Audience

8.1 Proposed Primary Target Audience

Demographic

Age                                                        : 13-18

Gender                                                   : Male & Female
Education                                              : Secondary School
Occupation                                             : Teenagers
Income/ Allowance range                     : RM500 and above

Race and Ethnicity                                : All races

Geographical Location                          :Urban & Sub-urban

Psychographics

Perception

-Consumers who enjoy sweets and trendy

-Sweet has become their necessity in their daily life

Learning

-TVC, Internet, Magazines, Flyers, Friends

Motivation

-Product that help consumer to keep track on what's new later on

-Eager to try new products

Attitude

-Cheerful, Explorer

lifestyle

-Modern, Outgoing, Active, Carefree

Chapter 9 – Research Development

9.1 Market Research & Market Observation
I choose to visit both Tesco and Jusco because they are both where people do most of their grocery. During the weekdays there are less people head for candy section, most of them are people who are buying cooking material for their business. Even in the weekend when there is more people are doing their grocery, I notices that people usually buy packed of sweets instead of lollipops. During my observations, some of the Tesco outlets does'nt sell Chupa Chups where normally can be found near the cashier, as for Giant, they sell in 1 whole bucket but the packaging is not appealing. I also did some reseach and observation on KK mart and some other mini mart. Most of them sell Chupa Chups but normally there are a few flavours available such as cola, vanilla chocolate, straberry. Besides that, I haven't see any Chupa Chups magics and Chupa Chups bubble gum sell in Malaysia. 

9.2 Online Survey

9.2.1 Survey Conclusion
From the survey above we can see that Chupa Chup's advertising in Malaysia is very less. 1-5 advertising in a year is very less for a world leading lollipop and candy company. It seems that Malaysian are more to Mentos compareto Chupa Chups. The survey also shows that people who are borned in 80's & 90's are well known about the existence of Chupa Chups. It also seems that the favourite flavour of all time is Cola follow by Vanilla Chocolate.
 Chapter 10 - Precedent Studies
10.1 Advertising Strategy

10.2 Precedent Studies