BUSINESS ANALYSIS CASE STUDY 2

BUSINESS ANALYSIS CASE STUDY 2

Abstract

The Campbell Soup Company was begun in the late 1860s as a partnership for canning vegetables, especially tomatoes. The company continued to grow, and it was an early adopter of

radio and magazine advertising, which helped to promote Campbell Soup to new heights as one

of the most well-known and loved American brands. After the turn of the millennium, there was

a slowdown in growth. Over the past decade and more, despite the company’s giant size and

revenues of $8 billion per year, revenues were lagging, losses were becoming the main return on

investments in new strategies, and new products were failing. This situation did not occur

overnight, but rather it was a changing environment along with discoveries of unethical behavior

by the company. The turning point for Campbell Soup, and its downfall, was the repeated use of

deception in marketing the taste, freshness and health of its products. This paper provides an

overview and analysis of the case.

BUSINESS ANALYSIS CASE STUDY 3

Introduction

The Campbell Soup Company was begun in the late 1860s as a partnership for canning

vegetables, especially tomatoes (Shea & Mathis, 2002). Anderson & Campbell set up their

operations in Camden, New Jersey, where there was a significant manufacturing presence, but

their marketing was focused on images of gardens and fresh food (Shea & Mathis, 2002). In

1876 Anderson left the partnership, and many of Campbell’s relatives joined the venture (Shea &

Mathis, 2002). Canned foods were still an emerging product form in America, however their

popularity was growing as was the capacity to transport and distribute products over a vast area,

even nationally (Shea & Mathis, 2002). The company continued to grow, and it was an early

adopter of radio and magazine advertising, which helped to promote Campbell Soup to new

heights as one of the most well-known and loved American brands (Shea & Mathis, 2002). The

company went public in 1956 (Shea & Mathis, 2002). Campbell Soup continued to grow and

expand it s product lines int eh latter half of the twentieth century, including the introduction of

meals that could be prepared using soup as a base, rather than just selling the soup for soup (Shea

& Mathis, 2002). After the turn of the millennium, there was a slow down in growth. Over the

past decade and more, despite the company’s giant size and revenues of $8 billion per year,

revenues were lagging, losses were becoming the main return on investments in new strategies,

and new products were failing (Wiener-Bronner, 2018). Shareholders, of which descendants of

the original founders represented about half of all shares, were at odds with more focused activist

investors, and efforts were diverted into board level debates and battles, rather than corporate

needs (Wiener-Bronner, 2018). The turning point for Campbell Soup, and its downfall, was the

repeated use of deception in marketing the taste, freshness and health of its products.

BUSINESS ANALYSIS CASE STUDY 4

Organization Type and Strategies

Campbell Soup Company is a multinational manufacturer of household products, with a

focus on ready to eat soups. Despite its large size and the wide distribution of products,

manufacturing takes place in the United States, and the primary market is the domestic American

household consumer market (Shea & Mathis, 2002). The most popular products, chicken noodle

soup, tomato soup and cream of mushroom soup, account for a majority of sales (Wiener-

Bronner, 2018). The industry is currently undergoing a massive upheaval driven by cultural

change and emerging preferences (Cardello, 2018). While overall the ready-made food market is

growing in America and globally, multinational food manufacturing companies are getting a

smaller and smaller share of this market while emerging small producers of fresh or non-mass

produced foods are taking this share while expanding the market (Cardello, 2018). Assumptions

have held for decision makers in the food manufacturing for decades, such as the idea that people

go to supermarkets, and to some extent “blindly toss their products into the grocery cart”

(Cardello, 2018, n.p.). This true of Campbell Soup Company, but also their major competitors

One important reason for the failure to adapt is that the competencies of ready-made food

manufacturers is mass producing food, and this cannot work with the distribution needs of fresh

prepared and small-batch ready-to-eat food (Cardello, 2018). The industry is in crisis, with most

of the chief executive officers (CEOs) including the CEO of Campbell Soup Company,

terminated in just the last few years (Cardello, 2018).

BUSINESS ANALYSIS CASE STUDY 5

Table 1: Sales trends in decline (Singh, 2018)

Key Players and Industry

There were many kinds of stakeholders in the ready-made and condensed soup market.

These include regulatory bodies like the Federal Trade Commission and the Food and Drug

Agency, consumers of soup, competitors, distributors and retailers. Organizations that are not

usually considered central to the industry that have been gaining importance are the public health