Analysis of Lindt Sprüngli Chocolate Brand

Analysis of Lindt Sprngli Chocolate BrandIn 2001, hot hot hot chocolate production (without semi-finished products) in Germany reached to 730,000 tons, of which 50,000 tons were exported. Sales volume of German chocolate merchandise was the biggest in the Europe (EUR 3.4 billion). Approximately 100 producers existed in the chocolate industry. 35% of the securities industry was served by the 2 biggest players Ferrero (from Italy) and Kraft Foods (from the USA). Both of them marketed quadruplicate marks of chocolate and were producing mainly for mass market. There also existed many family-owned meek confectioners. They were specialised in fine chocolates and exquisite pralines.Lindt Sprngli, a medium-sized company, hold the third position in the German chocolate market. The company served moreover subsidy segment.Market could be segmented by the type of chocolate apply in the production dark chocolate, white chocolate or unit of measurement milk chocolate. But the most c ommon way was to distinguish the market by the product type chocolate tablets, pralines, seasonal worker products, chocolate bars, chocolate surprise products and chocolate snacks. Lindt Sprngli products comprised all the first 3 types chocolate tablets, pralines, seasonal products.The following main distribution thoroughfares could be identified posture stores carried luxuriously quality chocolate, provided good divine service to customers, enabled confectioners to receive direct feedback from consumers and to prevail promotions at the point of sale.General retailers consist of food retailers and discount stores. This channel distributes products for mass market. Discount stores are classified as hard (foc employ only on price) and soft stores. General retailers provided low or no service for the customers.Proprietary shops or praline boutiques usually owned by small family-owned confectioners. This channel allowed the manufacturer to be very pie-eyed to end-customer and evaluate their feedback. Flagship stores, also fitted as proprietary shops, were utilise mainly to promote brand image.Convineince stores rivet mainly on impulse purchases.Online shops were only marginaly important in Germany. grinder outlets were used to sell the overrun or atomic number 16 choice products. intensity level stores were the core distribution channel for the Lindt Sprngli. But discount stores were putting high pressure on Specialty store. In 2000 discount store gross sales step-upd by approximately 40% compared to 1992, and Lindts sales in strength stores dropped by around 14% compared to 1992 (though moderate increase from 1997). Since 1997 Lindt Sprngli also used food retailers and soft discounters as additional distribution channel. Their step was do with caution and didnt take full advantage of segment growth, though raise high disapproval of specialty stores.Strategic AlternativesLindt Sprngli has different strategic alternatives.1. troupe can choo se exclusive intensity for distribution totally release the mass market and sell only through specialty stores. (Michael R. Solomon, 2009) In this case, Lindts brand image would increase, appropriate service would be provided, control on the distribution channel would increase, emotional connection with the customer would be established, close feedback sales in specialty stores would be monitored and specialty stores will be satisfied with decision. The negative effects are decreased revenue (mass market is a big market), increased bargaining supply of specialty stores. (Grant, 2010)2. intensive distribution for the most part focusing on mass market is another(prenominal) weft (while distribution through specialty stores is sustained). For implementing this strategy the company should largely use food retailers and soft discounter. This will probably increase the sales, and set out specialty stores bargaining power. In this case Lindt Sprngli could decrease its expenditure on RD. The negative effects of this option are lower brand image, myopic or no control on the quality of service, little or no feedback from consumer, vertical channel conflict (high competition will blow over to lower margins) dissatisfaction of specialty stores. Use of hard discounter would have ravaging negative affect on brand image. (Spekman, 2009)3. Flagship stores could be used to increase brand image and brand identity. This would also decrease bargaining power of specialty stores and could bring dissatisfaction of the latter. 4. Factory outlets could be used to sell the overproduction at low price. The overproduction of high priced products shouldnt be sold here. 5. For using convenience stores Lindt have to develop new products like snacks. Use of this option will negatively affect the brand image. 6. Online shops could be used for gift products. Especially for the seasonal products, it could be used to arrange a pitch shot as a gift.Given to increase the sales and to s ustain the companys school of thought of providing high quality chocolate, the best solution for Lindt Sprngli could be the use of multi-channel distribution. gild can split into 2 different brand names Lindt luxuriousness (for example) and Lindt. The first would be for high quality premium products with rigorous selected ingredients, and the second would serve mass market. This strategy only partly would harm brand image, but would increase the market share and revenues. Specialty stores would be only partly dissatisfied, as their products would differ from those of retailers and discounters. Online shops could be used additionally.