Introduction
For the over 60 years that it has been in existence, M&M’s has created a market share that is yet to be matched by the company’s close competitors. In 2004, the company was on record for realizing an impressive $201 million in candy sales in the United States alone, a feat that propelled it into the top spot in the market for boxed and bagged chocolates in the country (Wax, 2010).
The success of M&M’s has been attributed to many factors, including eye-catching and distinctive advertisements and promotions, effective consumer participation and feedback, extensive marketing strategies, affordable pricing, and a broad assortment of customized product possibilities. One of the foremost factors that have led to the unparalleled growth of M&M’s in the candy industry is the effective application of its marketing strategy.
According to Nash (2000), for contemporary businesses to remain competitive and be profitable, they must develop the right tools, especially in terms of understanding the products or services that their target market is looking for.
Indeed, businesses need not only concentrate on understanding what products should be introduced into the market, but they must ensure that objective data about the success of their current products within the selected target markets is available. This section aims to critically evaluate how M&M’s have so far managed to maintain a cutting-edge marketing strategy through careful selection of its target markets.
M&M’s Target Markets & Theoretical Backing
According to M&M’s official website, the company is currently engaged in producing a wide range of candies to not only cater for a broad market, but also satisfy individual tastes and preferences. The candies, which include peanut, almont, pretzel, baking bits, and dark chocolate, among others, comes in different colors and shapes aimed at satisfying the wants and needs of diverse target markets in the U.S. and beyond.
Virtual Advisor (2009) suggests that any effort towards developing an effective marketing strategy must first and foremost realize that existing and potential customers fall into specific segments that are largely characterized by their own unique needs and expectations. From the wide range of products going under the M&M’s brand name, the company has been able to successfully anchor its position as one of the best candy makers in the world (Rehoboth, 2004; Brown, 2004).
It is evidently clear that M&M’s company utilizes differentiated marketing to target unique market segments and make distinct offers for each product it produces depending on the needs of the target markets. Differentiated marketing, according to Kurtz et al (2010), occurs when a company endeavors to appeal to two or more noticeably defined market segments with a particular product and distinctive marketing mix customized to each separate market segment.
M&M’s company was quick to understand that the market for candies includes customers with diverse lifestyles, preferences, backgrounds, and incomes levels (Brown, 2004). As such, the company produces a multiplicity of candy products in addition to pricing, promoting, and distributing them using diverse marketing approaches ostensibly designed to satisfy the wants and needs of smaller target markets, which includes children, teenagers, adults, and people with specialized needs (M&M’s Website, 2010).
The practice of differentiated marketing, though costly to effectively run, has made it possible for the company to achieve higher than satisfactory sales in all of its target markets. Kurtz et al (2010) are of the opinion that, “…by providing increased satisfaction for each of many target markets, a company can produce more sales by following differentiated strategy than undifferentiated market would generate” (p. 280).
It is a well known fact that through the identification, evaluation, and selection of a particular target market to pursue, companies are better placed to come up with more efficient and effective marketing approaches. Kurtz et al (2010) suggests that, “…to identify these markets, marketers must determine useful ways of segmenting different populations and communicating with them successfully” (p. 260).
For M&M’s company, this has partly been achieved through catchy brand names, use of color to differentiate target markets based on age, and the use of cartoon imagery on the packages of candies to symbolize the company (M&M’s Website, 2010).
Indeed, the employment of cartoon characters as M&M’s marketing strategy for its candies has a long history dating back to 1954, when the cartoon characters Red and Yellow came into the fore, bringing with them the slogan, “The milk chocolate melts in your mouth not in your hand” (M&M’s Website, 2010).
To date, the carton characters and humorous TV commercials successfully illustrate the fun, color, and friendliness that are attached to M&M’s candies, and the company has effectively used this marketing strategy to appeal to various target markets, including children and teenagers. According to Elliot (2005), “…colors of Mega M&M’s are meant to appeal to more mature audiences; the regular hues like red, green, yellow and blue are being supplanted by shades like maroon, gold, beige and teal” (para. 8).
Appropriateness of Target Market Selection
It is evidently clear that M&M’s differentiated marketing strategy has been successful in terms of meeting and satisfying the needs and preferences of its target markets. Buy targeting and segmenting its customers along their unique needs and age, M&M’s has been able to offer exactly what each target market wants in its candy products.
This has led to sales increases over the years not mentioning the fact that the company still maintains its number one position in the business of candy selling according to industry figures (M&M’s Website, 2010). What’s more, the company’s unique advertising strategies based on comprehensive differentiation of its target markets continue to endear many customers to its ever increasing product list.
According to one of the company directors, customers are always on the lookout for extra excitement, and M&M’s is only too happy to respond to customer requests through the development of new products and packaging that are intended to target particular markets so that the image of M&M’s candies remains with the customers for a very long time – if not forever (Elliot, 2005).
Recommendations
The first recommendation is that M&M’s should utilize the convergence of technology witnessed in the 21st century to expand its target markets in countries that it is yet to set base (Wax, 2010).
Although expansion is costly at the short-term, the company’s strong sales performance and a wide range of candies for customers to choose from puts at a distinct advantage to benefit on long-term basis from expanding its target markets. Such a strategy would be aimed at enhancing the market performance of the company within its target markets.
It could also serve the company well to increasingly diversify its products range and introduce other products into the market that are associated with candies.
Such products may include chocolate sweets, health drinks, fresheners, and other lifestyle products. According to Voss & Voss (2008), increased product diversification serves to entrench a company’s products or services into its target markets. Furthermore, such an intervention will not only assist in improving market perception, but will also increase sales and market performance
Lastly, although the cartoon characters and the use of color have served well to market M&M’s candies to the various target markets, the company should work on other marketing strategies that appeal to unique target markets that may not particularly be attracted to cartoons or the various colors used. Still, a customer may today readily identify with a cartoon but identify with something else tomorrow. As such, continuous market research should be done to identify the trends of contemporary market segments (Voss & Voss, 2008).
List of References
Brown, S (2004). Tapping into New Fans. Retail Merchandiser, 44(7), 10-12.
Elliot, S (2005 ). Calories? Hah! Munch some Mega M&M’s. The New York Times. Web.
Kurtz, D. L., Mackenzie, H. F., & Snow, K (2010). Contemporary Marketing, 2nd Ed. Toronto, Ontario: Nelson Education Ltd.
M&M Website (2010). History. Web.
Nash, E. L (2000). Direct Marketing: Strategy, Planning & Execution, 4th ED. New York, NY: McGraw-Hill.
Rehoboth, W. G (2004). Dandy Candy. Convenience Store News, 40(13), 28-31.
Wax, B (2010). Target Marketing Thrives on the Web. Property & Causality Risk & Benefit Management, Vol. 114, Issue 14, p. 32-36.
Virtual Advisor, Inc (2009). Targeting your Market. Web.
Voss, G. B., & Voss, Z. G (2008). Competitive Density and the Customer Acquisition-Retention Trade-Off. Journal of Marketing, Vol. 78, Issue 6, p. 3-18.