Case Study Description of Campbell Soup Company: Selling Channel Innovation to Customers
Campbell Soup, like most food manufacturers, faced grocery chain and wholesale demand for its goods driven by Campbell's own promotional pricing structure rather than retail consumer demand. Former policies to encourage overstock created huge swings in production and inventory levels. Campbell's introduced continuous product replenishment (CPR) under which they would manage inventory for their customers, enabled by electronic data interchange to link supply to actual demand. Implementing this channel shift required a restructuring of relationships with its customers and a radical restructuring of its promotional policies.
Swot Analysis of "Campbell Soup Company: Selling Channel Innovation to Customers" written by Zeynep Ton, James L. McKenney includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Campbell's Soup facing as an external strategic factors. Some of the topics covered in Campbell Soup Company: Selling Channel Innovation to Customers case study are - Strategic Management Strategies, Customers, Data, IT, Supply chain and Technology & Operations.
Some of the macro environment factors that can be used to understand the Campbell Soup Company: Selling Channel Innovation to Customers casestudy better are - – digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, geopolitical disruptions, wage bills are increasing,
competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, etc
Introduction to SWOT Analysis of Campbell Soup Company: Selling Channel Innovation to Customers
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Campbell Soup Company: Selling Channel Innovation to Customers case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Campbell's Soup, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Campbell's Soup operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Campbell Soup Company: Selling Channel Innovation to Customers can be done for the following purposes –
1. Strategic planning using facts provided in Campbell Soup Company: Selling Channel Innovation to Customers case study
2. Improving business portfolio management of Campbell's Soup
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Campbell's Soup
Strengths Campbell Soup Company: Selling Channel Innovation to Customers | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Campbell's Soup in Campbell Soup Company: Selling Channel Innovation to Customers Harvard Business Review case study are -
High brand equity
– Campbell's Soup has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Campbell's Soup to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Technology & Operations industry
– Campbell Soup Company: Selling Channel Innovation to Customers firm has clearly differentiated products in the market place. This has enabled Campbell's Soup to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Campbell's Soup to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Campbell's Soup are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Successful track record of launching new products
– Campbell's Soup has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Campbell's Soup has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Low bargaining power of suppliers
– Suppliers of Campbell's Soup in the sector have low bargaining power. Campbell Soup Company: Selling Channel Innovation to Customers has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Campbell's Soup to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Campbell Soup Company: Selling Channel Innovation to Customers Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Effective Research and Development (R&D)
– Campbell's Soup has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Campbell Soup Company: Selling Channel Innovation to Customers - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Campbell's Soup digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Campbell's Soup has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Strong track record of project management
– Campbell's Soup is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Campbell's Soup has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Campbell Soup Company: Selling Channel Innovation to Customers Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Ability to lead change in Technology & Operations field
– Campbell's Soup is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Campbell's Soup in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Campbell's Soup is one of the most innovative firm in sector. Manager in Campbell Soup Company: Selling Channel Innovation to Customers Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Campbell Soup Company: Selling Channel Innovation to Customers | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Campbell Soup Company: Selling Channel Innovation to Customers are -
Need for greater diversity
– Campbell's Soup has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Campbell Soup Company: Selling Channel Innovation to Customers HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Campbell's Soup has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Campbell's Soup has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Capital Spending Reduction
– Even during the low interest decade, Campbell's Soup has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Campbell Soup Company: Selling Channel Innovation to Customers, it seems that the employees of Campbell's Soup don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
No frontier risks strategy
– After analyzing the HBR case study Campbell Soup Company: Selling Channel Innovation to Customers, it seems that company is thinking about the frontier risks that can impact Technology & Operations strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Campbell Soup Company: Selling Channel Innovation to Customers, in the dynamic environment Campbell's Soup has struggled to respond to the nimble upstart competition. Campbell's Soup has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Campbell's Soup is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Campbell's Soup needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Campbell's Soup to focus more on services rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study Campbell Soup Company: Selling Channel Innovation to Customers has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Campbell's Soup 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Campbell's Soup is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Campbell Soup Company: Selling Channel Innovation to Customers can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Campbell's Soup has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Opportunities Campbell Soup Company: Selling Channel Innovation to Customers | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Campbell Soup Company: Selling Channel Innovation to Customers are -
Buying journey improvements
– Campbell's Soup can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Campbell Soup Company: Selling Channel Innovation to Customers suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Better consumer reach
– The expansion of the 5G network will help Campbell's Soup to increase its market reach. Campbell's Soup will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Campbell's Soup can use these opportunities to build new business models that can help the communities that Campbell's Soup operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Building a culture of innovation
– managers at Campbell's Soup can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Technology & Operations segment.
Developing new processes and practices
– Campbell's Soup can develop new processes and procedures in Technology & Operations industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Creating value in data economy
– The success of analytics program of Campbell's Soup has opened avenues for new revenue streams for the organization in the industry. This can help Campbell's Soup to build a more holistic ecosystem as suggested in the Campbell Soup Company: Selling Channel Innovation to Customers case study. Campbell's Soup can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Campbell's Soup to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Campbell's Soup to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Campbell's Soup has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Campbell Soup Company: Selling Channel Innovation to Customers - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Campbell's Soup to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Campbell's Soup to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Campbell's Soup can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Campbell Soup Company: Selling Channel Innovation to Customers, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Campbell's Soup can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Campbell's Soup can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Campbell's Soup can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Campbell Soup Company: Selling Channel Innovation to Customers External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Campbell Soup Company: Selling Channel Innovation to Customers are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Campbell's Soup can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Campbell Soup Company: Selling Channel Innovation to Customers .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Campbell Soup Company: Selling Channel Innovation to Customers, Campbell's Soup may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Campbell's Soup needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Technology acceleration in Forth Industrial Revolution
– Campbell's Soup has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Campbell's Soup needs to keep up with the evolution of technology in the Technology & Operations sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Regulatory challenges
– Campbell's Soup needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Technology & Operations industry regulations.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Campbell's Soup will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Campbell's Soup business can come under increasing regulations regarding data privacy, data security, etc.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Consumer confidence and its impact on Campbell's Soup demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Campbell's Soup in the Technology & Operations industry. The Technology & Operations industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
High dependence on third party suppliers
– Campbell's Soup high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Campbell's Soup.
Weighted SWOT Analysis of Campbell Soup Company: Selling Channel Innovation to Customers Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Campbell Soup Company: Selling Channel Innovation to Customers needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Campbell Soup Company: Selling Channel Innovation to Customers is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Campbell Soup Company: Selling Channel Innovation to Customers is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Campbell Soup Company: Selling Channel Innovation to Customers is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Campbell's Soup needs to make to build a sustainable competitive advantage.
