Campbell's Soup Products

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The purpose of this memo is to analyze the external and internal environment that Campbell’s is currently facing as well as provide evaluation for the future strategies. Campbell’s Soup Products have become an American cultural icon over the past century; the red and white can has been known as a principal of America’s diet for generations. Campbell’s should take advantage of this status by utilizing the brand equity that has been gained to expand into new product sectors. Specifically, Campbell’s should enhance the condensed soup line with product improvements, additional sodium reduction, and new marketing aimed at the organic and simple meals categories. Analysis of External Environment Regulatory The latest labeling within the food rating…show more content…
It is an international company and sells more than 8,500 products in over 100 countries. Nestle has been able to achieve significant growth through the acquisition of key brands, including Source Perrier in 1992, Ortega Mexican foods in 1995, San Pellegrino mineral water in 1998, and Gerber in 2007 (Hitt). Nestle has been able to succeed because of the way it adapts products to appeal to local tastes. Competitive Rivalry within Processed and Packaged Foods Industry The rivalry among companies in the Processed and Packaged Foods industry is high. These food-processing companies are competing on brand recognition, quality, price, advertising, promotion, convenience and service (Hitt). Campbell's major rivals are General Mills and Nestle. However, Campbell’s high quality of soup products and its ability to maintain low production costs weaken the rivalry of the generic soup brands. Campbell’s will need to continue developing superior healthy food to distinguish itself from General Mills’ Progresso and smaller soup maker companies. Threat of New…show more content…
Campbell’s major rivals, Nestle and General Mills, create high entry barriers in the Processed and Packaged Foods industry through their high levels of advertising and promotion. The intense competition in the food processing industry makes it hard to gain access to the market and makes the expected retaliation high. In addition, smaller food processing companies often have difficulty obtaining supermarket shelf space for their products as large retailers charge for space on their shelves and give priority to the established companies who can pay for the advertising needed to generate high customer demand. Any new entrant will face high capital requirements, and due to this barrier there are large amounts of acquisitions within the industry. Threat of Substitute Products The threat of substitutes is high due to the significant possibility of consumers choosing to eat out or to cook at home with ingredients that do not involve packaged goods within the meal. This threat increases as the economy recovers and consumers’ disposable incomes increase. The threat is also high due to the low switching costs involved for consumers. Bargaining Power of

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