Beruflich Dokumente
Kultur Dokumente
Marketing Plan
(Christmas Holiday Season 2010)
Module Title:
Principles of Marketing Management
Module Leader:
Dr. Wen-Ling Liu
Module No: 56181
Level: 7
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In the UK, according to sections 7, 14, 15, 20 and 21 of the amended Food Safety
Act 1990, there are strict guidelines regarding food nutrition, safety and hygiene
factors. For example, according to section 14, the following is not permissible:
“selling to the purchaser’s prejudice any food which is not of the nature or substance
or quality demanded by the purchaser”. Alternatively, breaching General Food Law
Regulation (EC) 178/2002 can lead to imprisonment for a term from six months to
two years (Food Standard Agency [FSA], 2010). The FSA also advises producers to
decrease the level of saturated fat contained in chocolate confectionery products
(Mintel, 2010).
2.1.2 Economics
The towering effects of recession involved heavy falls in GDP and exemplified the
rising unemployment rate in 2009 (Mintel, 2010). In 2010, the unemployment rate is
8.0% and has increased by 0.2% from previous years (National Statistics, 2010).
According to Mintel (2010), consumer expenditure and disposable income have risen
slowly. In 2010, the GDP rose by 1.1%, which is 4.7% below its pre-recession level
(National Statistics, 2010).
2.1.3 Socio-cultural
The total population of the UK increased by 0.6% in 2009 from 2008, a rise of
394,000, and the projected population is expected to be 4.3 million by 2018, as the
average growth of the population is over 1,000 people a day (National Statistics,
2010). According to McKechnie & Tynan (2006), a reciprocal trend of presenting and
accepting gifts is present in the society of the UK at Christmas, which is an
emblematic time for friendship, gathering and love. Also according to McKechnie &
Tynan (2006), the Christmas period is the time for achieving the most important
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2.2.1 Customers
Despite the forecast, the UK’s boxed chocolate market value is now £1,246 million,
which is higher than the value in 2006 (Mintel, 2010). In 2009, an overall increase of
9.2% in the chocolate confectionery market reached the value of an estimated £3.6
billion. Although the market was thought to be recession proof, in real terms sales
growth has fallen by 2.9% (Mintel, 2010). Despite decreased sales growth, 2009 had
a glimpse of success, i.e. the “re launch of Wispa and launch of Nestlé’s low-calorie
treat Kit Kat” provided a boost in the market (Mintel, 2010). On the other hand,
Cadbury’s fair trade products expanded in the market by 131% between 2006 and
2008 (Mintel, 2010). According to Mintel (2010), the total chocolate market is
dominated by “43% of new launches of boxed chocolates vs. 33% for seasonal
chocolates, and 25% for chocolate count lines and moulded chocolates”. The
changing tastes of consumers and continuous pressure from the FSA entails the
chocolate confectionery market in offering healthier consumer products, which leads
them to the new product innovation which has been lacking in this industry (Mintel,
2010).
2.2.3 Competitors
In recent years, Ferrero has faced a tough contest in the market. Competitors are
innovating and improving their design and technological pattern. The major
companies in this industry are as follows:
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According to Mintel (2010), CTB lost its premium position in the market after Mars’
acquisition of Wrigley. In the UK, CTB’s market share went down to 30% from
34% in 2009 with a value of £1,058 million compared to the last financial year.
Under CTB’s product range, Trident, with its unique flavour combinations, is
the world’s leading chewing gum brand, which had a sales reach of £33
million in 2008 (Mintel, 2010). Later on, they launched the first chocolate-
flavoured chewing gum in the UK. CTB offers sugar-free confectionery which
includes the product line of Bassett’s in Kent, Maynards Wine Gums, Pascall,
Sour Patch and Swedish Fish. In 2009, Cadbury launched “gummy-bear-
shaped candies which are available in different flavours and are additive- and
preservative-free” (Mintel, 2010). Alternatively, for Christmas 2010 Cadbury
revealed new chocolate merchandise, i.e. Cadbury Wishes, “star-shaped milk
chocolates with aerated centres”, from which 10% of the profits were donated
to an aid organization (Mintel, 2010). Moreover, this company will be the
official confectionery and ice-cream sponsor of the London Olympics in 2012
(Mintel, 2010).
Mars
Mars became the world’s largest confectionery manufacturer in 2008 after the
purchase of Wrigley, which includes the brand portfolio of “Boomer, Big Red, Excel,
Extra, Freedent, Winterfresh, Life Savers, Hubba Bubba, Pim Pom, Orbit, and
Doublemint” (Mintel, 2010). In the UK Market, Mars’ market share went down to 27%
from 31% in 2009, which was worth £978 million, although within the period 2005-09
their market share went down by 2.4% (Mintel, 2010). According to Mintel (2010), by
2020 Mars will ensure that all their product range will use cocoa from sustainable
supply and to verify their cocoa they will use the Rainforest Association Plan, which
ensures a sustainable and ethical source of their product range. Mars caters to
different tastes and has a range of products, such as Starbust Smoothies, Opal
Fruits, Extra Ice, Skittles, Skittles Confused, Mars, etc. and in 2008 their total
advertising expenditure was £10 million (Mintel, 2010). In 2009, Mars launched a
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new aerated chocolate bar, Galaxy Bubbles, supported by £2.5 million marketing
use.
Nestlé is one of the world’s largest manufacturers of “coffees, milk drinks, chilled
meats, chocolate and confectionery” and in 2009 they possessed 21% of the UK
market share, valued at £733 million (Mintel, 2010). In order to improve sales and
increase demand, Nestlé launched “price-marked packaging” in the UK. Nestlé’s
product range includes Fruit Gums, Rowntree’s Fruit Pastilles, Tooty Frooties and
many others, which are mostly aimed at children. In 2010, a “vanilla-flavoured split-
pot yogurt” with Kit Kat pieces was launched by Nestlé and they also launched a new
Easter egg line up for Easter 2010, which includes the Smarties egg, Rolo egg and
the “last Rolo” (Mintel, 2010). In 2009, Nestlé invested almost £750,000 in
advertising the polo brand and they launched the “Accelerating Success” idea along
with an association of the UK’s leading athletes (Mintel, 2010).
Ferrero has introduced a new product into their product portfolio and also become
part of an ethical cocoa-buying scheme, which will enhance their brand image and
value (Mintel, 2010). Ferrero has also started a new website, (ferrero-trade.co.uk),
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which will assist retailers in improving sales. In recent years, the major aspect of
Ferrero offers 15 different chocolate products, which include the Nutella, Ferrero
Rocher, Fiesta Ferrero, Kinder Maxi, Kinder Bueno, Giotto, Confetteria
Raffaello and Tic Tac brands.
Ferrero collection: Ferrero Rocher perhaps the best known flagship brand in the
world which contains hazelnut in milk chocolate and hazelnut in the centre.
Unpacking each Ferrero chocolate seems like a gift. It has two other different
collections which include Rondnoir (dark chocolate with a hazelnut in the centre and
a roofed wafer along with silky cocoa) and Ferrero Garden (with a creamy centre and
dusting of coconut covered with a white shell) (Ferrero UK, 2010). To enhance the
occasion and to share something special consumer chooses Ferrero collection
(Ferrero UK, 2010).
Kinder range: This includes Kinder Bueno, Kinder Délice, Kinder Joy and Kinder
Chocolate, etc., which are all about “mom treating the children in a responsible way”
(Finweek, 2009). Other than children, adults also love kinder products as snacks or
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Promotion
Distribution
Ferrero offers their products in the market through different distribution channels,
such as multiple retailers, the Internet and convenience stores (Tesco Express or
Sainsbury’s Local). At Christmas and Easter, express store delivery also happens
and between August and April co-packing operations providing “Dollies” (chocolate)
for Sainsbury’s and Tesco also increases (Mintel, 2010). In 2009, to assist retailers
to increase sales, Ferrero started a new website, Ferrero-trade.co.uk, which offers
vendors suggestions for gifting with a box of chocolate, kids’ confectionery and
sweet spreads mints, and countlines (Mintel, 2010). Ferrero also became part of an
“ethical cocoa-buying scheme called Source Trust, which claims to be able to ensure
the provenance of the cocoa sourced and the welfare of cocoa farmers for a
premium price” (Mintel, 2010).
Price
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For the different product ranges, Ferrero applies different pricing strategies. For
example, a Ferrero Rocher gift box with 32 candies costs £7.99 in Tesco,
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3. Marketing objectives
4. Target market
Demographic
Age: Children, parents and young people (age group 7-35 years)
Gender: Male and female
Generation: New generation
Occupation: Students, full-time workers and professionals
Psychographic
Personality Accept changes, love to experience new tastes; also early adopters as
well, who are very loyal to brands in this category, having a greater
influence on how manufacturers treat their brands (Mintel, 2010).
Lifestyle Caring for close ones, socially open-minded and love to taste new dairy
products as well as share (Mintel, 2010).
Value Who evermore want to form, expand or manipulate tastes, and share these
creations with their peers (Armano, 2006). Relations are more than
anything to these people. According to Dratch, “We've become so non
traditional in our outlook of how we live life” (2005).
Behaviour
Purchase decision Food items purchase decision is the active participation
of young people and adults, which sometimes might be a
joint activity by parents or friends (Noergaard et al.,
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5. Product offerings
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6. Positioning
Brand positioning
Ferrero has the indulgences of the market for its products and innovations in ideas.
Marketing Director of Ferrero UK, Dave Tucker, has said that “Ferrero has always
been synonymous with Christmas, for family and friends. Our new campaign builds
on this association, to highlight that giving and sharing Ferrero this Christmas can
make the occasion even more special” (Golding, 2009). Twice a year, Linkfluence
carries out a brand essence study to review quantitatively and qualitatively the
changes in observation about Nutella, Kinder and Ferrero. The learning from this
recognizes the existence of chances for brand positioning and communication and
proposes ideas helpful to the product innovation strategies (du Gardier, 2009).
According to Ferrero, the company “wants to remind consumers that ‘Christmas isn't
Christmas without Ferrero’” (Golding, 2009). According to the Boston’s BCG model
(Herndemson, 1972), “It captures the relative market share of a business unit or
product”.
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7. Marketing mix
1. Strategy
The item for consumption comes in particular targeted pack formats, together with a
seasonal cube and a Christmas tree-formed box, an Easter egg format and a variety
of sizes to meet consumer needs all around the year. An innovative diamond format
has also been initiated to further improve the premium significance of the brand.
Ferrero has also signed up to the Source Trust to ensure that the cocoa sourced can
be traced back to its origins and that cocoa farmers receive their due (Mintel, 2010).
This will help Ferrero to reveal their philanthropic activities to the consumers who are
sensitive and cautious regarding the companies whose products they enjoy.
2. Tactics
Ferrero, like Lindt and Thorntons, appears to run marketing campaigns during the
run up to specific occasions with special gift ranges (Mintel, 2010). These
promotions have included heart-shaped packs for Valentine’s Day and Mother’s Day
by Ferrero Rocher and TV, press advertising and sponsorship (Mintel, 2010). Its
360-degree advertising campaign for Christmas 2009 tried to reiterate its image as a
company selling premium gifts for special occasions (Mintel, 2010).
7.2 Price
In the UK, the strongest consumer trends are regarding “premium single inlaid
boxes”, where delivering superior value indicates that producing a fresh line of
products can be worthwhile (Mintel, 2010). Uncertainty and cost factor regarding the
price can discourage consumption, so more predictable prices can be executed by
Ferrero to accommodate consumers. For Ferrero, the best possible way would be to
not react to each negligible modification of input cost (Matějka, 2010). Frequent price
changes can create a great deal of consumers’ attention, which can lead to reduced
consumption. In line with high-value chocolate products, Ferrero is on the way to
offer its products in the shape of a desirable pricing strategy to its consumers.
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7.3 Place
1. Retailers
Ferrero chocolates and confections can be found in the confectionery aisle and/or
the sweet section by the checkouts in most pharmacy, grocery, mass merchandiser,
warehouse clubs and convenience stores (Ferrero, 2010). Consumers who may be
looking for a gift are also able to buy Ferrero products from a grocery chain, as they
are ideally placed for last-minute purchases, helped by their longer opening hours
(Mintel, 2010).
While supermarkets are the main outlet from which consumers buy their boxed and
seasonal chocolates, one-third still look to the chocolate specialists when they are
looking for a box of chocolates (Mintel, 2010). Consumers do not appear to be
browsing long in the boxed chocolates aisles and obtaining advice on what type of
chocolate to buy does not appear to be a priority, as only 13% of consumers’ state
that they like to receive such advice. However, there is scope to introduce chocolate
counters in the larger grocery chains, offering consumers a more personalized
service (Mintel, 2010).
7.4 Promotion
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Tougher economic conditions and rising raw material costs have put manufacturers’
profit margins under increased pressure (Mintel, 2010). They have had to rationalize
their marketing budgets and find more innovative ways to promote their product
ranges (Mintel, 2010). Last year, to gain a major confectionery market, Ferrero
Rocher launched a £5 million marketing push campaign for its Christmas collections
and to promote “Christmas isn’t Christmas without Ferrero” (Pitch, 2010).
Consumers with a vision of representing themselves to their close ones may find the
communication by Ferrero an effective way to be persuaded.
Advertising media are to increase sales in all retail outlets and increase awareness
of prospects with the new presentation of Ferrero as follows.
7.4.3.1 Advertising
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Magazines and comic books, the latter having a high volume of interested young
people including children, is the major entrance for Ferrero for those who love to
spend some time reading. An editorial is something that children can access online
for free (Mintel, 2010), which is one solution for young people to attain successful
sales.
Outdoor advertising
Within the suburban centres of cities with dense populations, bus advertisements,
billboards and screen displays could be utilized: London, Cardiff, Manchester,
Glasgow, Leeds, Bristol, Birmingham and in Scotland as well.
Television/radio
TV has remained the dominant medium used by all manufacturers, accounting for on
average 57% of advertising expenditure. Ferrero had the highest spend on TV in the
monitored period, with their Ferrero chocolates. (Mintel, 2010). Young people can
be attracted by high frequency TV commercials during different kinds of television
shows.
Online
On high traffic websites, banner-ads for young people could be utilized. Internet TV
with access by all is the answer for attracting the young generation who spend a lot
of time on the Internet.
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Social networking sites are the root to finding the exact target audience and
communicating with them the message of Ferrero. Young people are in the first
position to be in touch with social networking sites and they are in the way to
communicate about Ferrero this Christmas.
Sales promotions of this kind are intended to be for a short period of time only.
Cash discounts
this plan have been illustrated briefly in Appendix 5. To achieve the best possible
10. Conclusion
Establishing the bottom line for the consumers buying special Christmas products,
along with Ferrero’s regular products, by detailed analysis of all possible marketing
strategies and views will be reflected in the sales volume of Ferrero during this
coming holiday season in the UK. Observing market trends and market behaviour
can sometimes result in a slightly different picture from the actual outcome. The
realization of all possible scenarios throughout the study will help in reviewing the
market positioning of Ferrero after the Christmas campaign.
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Dratch, Dana (1 October 2005) “Brand Packaging”. Retrieved 5 August 2010 from:
<http://www.allbusiness.com/marketing/market-research/622021-1.html>.
Finweek (2009) “Ferrero: entrepreneurial and innovative. At the heart of the global
Ferrero company is a family business”. Retrieved 1 August 2010 from:
<http://web.ebscohost.com/ehost/detail?vid=1&hid=106&sid=7c242208-f784-
4b9c-b3b5-
5e9e43278353%40sessionmgr110&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d
%3d#db=buh&AN=42842046>.
%3d#db=buh&AN=42842051>.
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between Local and Electronic Markets: How the Benefit of Buying Online
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Golding, Amy (13 October 2009) “Christmas treats: Ferrero Rocher promotes its
boxed chocolates” . Retrieved 5 August 2010 from:
<http://www.marketingmagazine.co.uk/news/945296/Christmas-treats-
Ferrero-Rocher-promotes-its-boxed-chocolates/>.
Henderson, B. (1976) “Anatomy of the Cash Cow”. Retrieved 5 August 2010 from:
<http://www.coursework4you.co.uk/essays-and-dissertations/bcg-growth-
sharemarket.php>.
Kahle, Lynn R. and Chiagouris, Larry (1997) Values, Lifestyles and Psychographics,
Mahwah, NJ: Lawrence Erlbaum Associates, p. 389.
Matějka, Filip (1 April 2010) “Rigid Pricing and the Rationally Inattentive Consumer”.
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<SSRN: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1653309>.
Mintel (2010) “Television and Film: Enhanced Viewing Formats - UK - July 2010”.
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<http://academic.mintel.com/sinatra/oxygen_academic/my_reports/display/id=
503582&anchor=atom/display/id=540090>.
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<http://academic.mintel.com/sinatra/oxygen_academic/my_reports/display/id=
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1.2 Outdoor
In suburban
centres in cities
1.2.1 Billboard
with a high
population
In suburban
centres in cities
1.2.2 Buses
with a high
population
In suburban
1.2.3 Screen centres in cities
displays with a high
population
20 sec.
1.3 TV commercial
1.3.1 British TV 2 / day
1.3.2 BBC 2 / day
1.3.3 MTV 2 / day
15 sec.
1.4 Radio commercial
1.4.1 Planet Rock 1 / day
1.4.2 BBC Radio
1 1 / day
1.4.3 Choice FM 1 / day
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Banner and
1.5 Online content ad.
2. Public Relations
2.1 Media relations:
press release 4
3. Direct marketing
3.1 E-mail marketing 1 / week
4. Sales promotion
4.1 Cash discounts ---
5. Campaign
research
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Total 3,000,000
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Labelling
1. Design
2. Print
Market Research
5. Market Research Manager
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1.2 Labelling
1.2.1 Designer
1.2.2 Print
2. Distribution 11 550,000
2.1 Transport of inventory
2.2 Warehousing
2.3 Distribution service
2.4 Administration
2.5 Delivery
3. Price 9 450,000
3.1 Administration
3.2 Quantity discount
4. Promotion 60 3,000,000
4.1 Advertising
4.2 Public relations
4.3 Direct marketing
4.4 Sales promotion
4.5 Campaign research