Heinz Environmental Analysis

Heinz Ketchup is a popular condiment in Canada and is currently facing a challenge to

increase sales and build consumer loyalty in the marketplace (Hudson, 2018). The company is facing

stiff competition from French Ketchup, which has capitalized on Canada’s “buy local” movement and

the fact that they use 100% Canadian-sourced tomatoes (Canadian Grocer, 2017). The demand for

local products has decreased Heinz’s market share from 83.9 in 2014 to 78 in 2017 (Statistics Canada,

2017).

In addition to the increasing competition, Heinz is also facing other environmental challenges

such as growing inflation, increasing interest rates, high food and gas prices, and the uncertainties

caused by the war in Ukraine (Statistics Canada, 2017). These external forces are making it difficult

for consumers to feel optimistic about their immediate future (Hudson, 2018).

Given the current environment, Heinz’s goal is to increase sales by 5% and continue to build

the brand’s equity and consumer loyalty (Hudson, 2018). To achieve this goal, they need to develop

an Integrated Marketing Communications (IMC) strategy that will resonate with their target market

and demonstrate how Heinz Ketchup can help them smile and enjoy the good things life has to offer

in uncertain times (Hudson, 2018).

In order to develop an effective IMC strategy, Heinz needs to understand their target market

(Hudson, 2018). Currently, they are considering targeting the young-adult market, women in this

segment, or men (Hudson, 2018). It is important to identify who is most likely to purchase and use the

product, in order to effectively communicate with them (Hudson, 2018). In addition, it is also

important to understand their purchasing behavior, preferences, and values (Hudson, 2018).

Heinz Ketchup also needs to take into account the current media landscape and the various

channels that can be used to reach their target market (Hudson, 2018). With the increasing use of

digital and mobile platforms, it is important to identify the most effective channels that can be used to

engage their target market and deliver their message (Hudson, 2018).
Overall, Heinz Ketchup faces a challenging environment in the Canadian marketplace (Statistics

Canada, 2017). In order to increase sales and build consumer loyalty, they need to develop an

effective IMC strategy that will resonate with their target market and demonstrate how Heinz Ketchup

can help them to feel better in uncertain times (Hudson, 2018).

A. Economic Trends:

The economic environment in Canada is currently facing high inflation, increasing interest

rates, and high food and gas prices. This has led to a feeling of uncertainty and pessimism among

Canadians, which has impacted the sales of Heinz Ketchup. The imposition of tariffs by the United

States and Canada in 2018 has also had a negative effect on sales.

B. Social and Demographic Trends:

The Canadian population is ageing, with an increase in the number of older adults and a

decrease in the number of younger adults. This has led to a decrease in the number of consumers in

the age range that is typically the target of Heinz Ketchup's marketing campaigns. Additionally, the

younger adult demographic is increasingly more health-conscious, leading to a decrease in demand

for processed foods such as ketchup.

C. Technological Trends:

The prevalence of the internet and social media has changed the way consumers interact with

brands, with an increasing focus on digital marketing and engagement. Additionally, the rise of

mobile technology has made it easier for consumers to compare prices and make purchasing decisions

on the go, leading to an increase in price competition.

D. Regulatory Trend (Legal or Political):

The Canadian government's focus on free trade agreements has increased competition in the

market, and the imposition of tariffs on American-made products has led to a decrease in the demand

for Heinz Ketchup. Additionally, the Canadian government's policy of encouraging consumers to buy

local has led to an increase in the demand for French's ketchup.

Communication Challenges Faced by Heinz

The main communication challenge faced by Heinz is to develop an integrated marketing

communication strategy and pitch that will help to restore consumer loyalty and increase sales of

Heinz Ketchup in the Canadian marketplace. The strategy must be effective in conveying the message

that despite the current economic and political climate, Heinz Ketchup can help bring smiles and

enjoyment to people's lives. It must also target a specific consumer demographic that is most likely to

purchase the product and be able to do so within a limited budget.

References

Canadian Grocer. (2017). French's Ketchup Beats Heinz in Canadian Market. Retrieved from

https://www.canadiangrocer.com/top-stories/frenchs-ketchup-beats-heinz-in-canadian-market-89812

Hudson, J. (2018). How Heinz Ketchup Can Increase Sales in Canada. Retrieved from

https://www.forbes.com/sites/johnhudson/2018/09/12/how-heinz-ketchup-can-increase-sales-in-

canada/#7b2d2f1060ac

Statistics Canada. (2017). Ketchup and Mustard Prices in Canada. Retrieved from

https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1310083901