The purpose of this report is to evaluate the marketing mix of Schneiders food, past marketing strategies and prospects in the future to suggest changes.
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The last large traditional manufacturing plants “Schneiders food” established in Canada In 1890 to produce packaged processed meats, poultry and grocery products; this company runs as a subsidiary of Maple Leaf Foods (Schneiders 1 and Mercer 1).
Marketing Mix of Schneiders Food (Maple Leaf Foods)
Schneiders Food, being a brand of Maple Leaf Food, offers a wide variety of products like Bacon, Cold-Cuts-and-Deli-Meats, Ham, Hot Dogs, Sausages, ham stuffed tomatoes, Country-Naturals, and Lunchmate as well as many other items.
According to MLF (1), Maple Leaf Food offers high quality products through brands like Schneiders, Dempster’s, POM, Mitchell’s Gourmet-Foods, Bon-Matin, Burns, Olivieri, Maple Leaf Prime Naturally, and so on; moreover, products like Dempster’s and Bon-Matin-Healthy-Way with ProCardio are exclusive recipes designed to maintain healthy cholesterol and blood pressure-levels; conversely, ThinkFOOD is formed to expand the company’s bakery and protein-based products.
The company’s Meat-Products-Group comprises value-added fresh-meats, chilled and ready-to-cook products, ready-to-serve products, and packaged-meats; moreover, Bakery-Products-Group comprises breads, rolls, ethnic-breads, bagels, croissants, morning-goods, baked-goods, and pastas, whereas the Agribusiness-Products-Group possesses biodiesel production and hog production operations
According to the annual report 2011 of Maple Leaf Foods, it increased the price of packaged meat products due to volatility of the price of raw meat products and the rationale of this strategy was to increase aggregate profit margin this firm. On the other hand, Mercer (1) stated that it needed to invest large amount in order to expand its business operation in Hamilton and other place; therefore, the management of this company decided to boost the price.
At the same time, the management of parent company of Schneiders food increased the price to balance the restructuring costs of $2.5 million and to face the challenge of operating costs, for example, annual income from poultry processing business decreased drastically because of continuous raises in live bird costs.
Packaged food products of this company was popular both in national and international markets (particularly in the American and European market), for example, in home, it operated in Ontario, Manitoba, Quebec and British Columbia; however, Maple Leaf Foods would like to restructure the business by starting operation in new place or closing unprofitable centers (Schneiders 1 and Mercer 1).
In 2000, it had 22 operating facilities along with 5000 staff (excluding retail market) to offer above 1000 products in the US and Canada; however, the marketers of this company expanded its operation the European market particularly Italian market following joint venture strategy and took technological supports from various partners, for example, Cappola Food, Mitchell’s Gourmet Foods and so on.
Apart from a number of advertising methods conducted by Maple Leaf Foods, its brand Schneiders undertakes promotional activities based on its individual products; for example, discount of one dollar on subsequent purchases of Lunchmate and Fruit, and coupon to save one dollar on any pack of Schneider’s Juicy Jumbos, Red Hots and Grill ‘Ems products.
However, it is arguable that rather than offering various types of promotional codes, Schneiders mainly focuses on promotional activity based on small discounts on the products, which creates boredom among customers; moreover, the method of offering the discounts are also not lucrative.
Assessment of How Well the Marketing Strategies Worked In the Past
In order to assess the extent to which the marketing mix of the company has worked in the past, it is essential to look at the financial highlights and past sales figures of the company. It is arguable that the marketing strategies have worked well in the past as the financial position and sales figures indicate that in the past, the company has performed better than its competitors and in comparison to its own position presently.
The following figure shows the past performance of the company in terms of sales, financial position, and earnings per share in order to illustrate that the marketing strategies have worked well in the past, because of which the situation was better in 2005 – 2006 period:
Figure 1: The past performance
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Source: MLF (1)
Prospects in the Next Few Years
According to MLF (2), the sales of the company has fell gradually from 2007 to 2011; in addition, although most of the multinational corporations has already recovered from the global financial crisis, falling sales in this stage when the economy is booming indicates that there are certain deficiencies in the marketing strategies of the business presently.
Although the marketing strategies have worked well in the past, this requires modifications at this stage so that the consumer demands do not fall in future because of boredom with the company’s products, or because of monotonous promotional strategies.
There is a requirement for diversification in the product line and initiation to offer attractive promotional packages. Otherwise, in the next few years, the revenues of the company will diminish significantly; however, the following figure shows how the present performance of the company is deteriorating:
Figure 2: The present performance
Source: MLF (2)
Need for Change
Because of inadequate present performance, it is necessary for the company to diversify its product line to increase the customer base; moreover, in order to boost sales, the company should offer attractive promotional packages.
Present pricing strategy of Maple Leaf Foods needs to change though the pricing structure played vital role for the success of last year; however, it requires change because the purchasing power of the customer has decreased all over the world; therefore, it should reduce present pricing strategy to increase large customer base in local and foreign packaged processed food markets.
On the other hand, Flaming (2) presented audit report on energy savings in meat processing and stated that Schneiders food had tried to reduce operating costs to offer products at comparatively lower price, for instance, it saved about $78,000 by reducing warm stand-by boiler; however, following figure shows more elaborately –
Figure 3: – Steam System Energy Savings
Source: – Flaming (2)
Figure 4: – Refrigeration System Energy Savings
Source: – Flaming (2)
In this context, Maple Leaf Foods will lose strong customer base of Schneiders food if it not restructure its pricing strategy. At the same time, if the management if this company seems that they will not change pricing strategy, then they must have to rethink about their marketing plan along with value creation program.
Business expansion strategy of Schneiders Food before acquisition was relatively slow, but effective to gain competitive advantages and increase profit margin from international market; however, the aim of this company was to consider the development of the product Life Cycle to expand its market.
Mercer (1) provided information about the expansion plan in the local market and the annual report Maple Leaf Foods did not give any clear idea in this regard, but from the scenario, it can assume that Schneiders Food followed the Uppsala internationalization model, which recommends the company to develop business in local market and starts internationalization from psychically near.
According to this internationalization model, the growth would be slow; thus, this report suggests Schneiders Food to consider other expansion model, such as, born global to concentrate on rapid expansion in the prospective market like Asian market.
Instead of focusing on monotonous small discounts only, there should be interesting promotional packages, for example, setting special offers for New Year festivals, Christmas Eve, Valentines Day, Mother’s Day, Father’s Day, and Halloween by means of special vouchers, promotional codes, and special reductions for loyal customers.
On the other hand, it is notable that Maple Leaf Food has not effectively used social media in marketing the products of its Schneiders brand – as a result, there is inadequate advertisement of the brand in such an important media.
By advertising through Google +, Foursquare, Twitter, Myspace, or Hi5, the company will be able to inform a large number of people about the products at the same time; this is because today, people of almost every country use this social networks to connect with the outer world notwithstanding the geography, age, gender, martial status, education, or cultures.
Social-networking-websites are awesome for constructing consumer relationships; moreover, it is quite simple to connect with consumers at social websites through which the company can provide helpful information about products and update information frequently; conversely, Schneiders could share consumers’ experiences and ask for feedback; in addition, consumers will also enjoy joining the community to find information about what to buy.
Flaming, Dennis. Energy Savings in Meat Processing. 2011. Web.
Mercer, Greg. Maple Leaf Foods closing Kitchener Schneider’s plant, 1,200 jobs to be lost. 2011. Web.
MLF. A little bit about us. 2008. Web.
MLF. Annual Report of Maple Leaf Foods. 2011. Web.
MLF. Investor Fact Sheet. 2008. Web.
Schneiders. Overview of Schneiders food. 2011. Web.