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Ferrero

Marketing Plan
(Christmas Holiday Season 2010)

Module Title:
Principles of Marketing Management

Module Leader:
Dr. Wen-Ling Liu
Module No: 56181
Level: 7

Submission Date: 20 August 2010


Executive summary
The plan has been developed to support Ferrero’s finest chocolate range, which
includes the “Ferrero Collection”, as well as the newest additions, “Ferrero Rondnoir”
and “Raffaello”. High quality, crafted precision, product freshness, careful selection
of the finest raw materials, respect and care for our consumers. These are the
Ferrero “key values” which have endeared our products to millions of consumers all
over the world (Ferrero, 2010).
A media campaign, along with activating the consumers’ attention to the
Ferrero brands, has been considered throughout this study. Initially, the situational
analysis was revealed to analyse the market challenges and the opportunities for
Ferrero to utilize the tools in this year’s Christmas campaign. The marketing mix was
determined to value the products offered by Ferrero. In the following sections, a
marketing plan has been proposed with the situational measurements, along with an
assessment of the effectiveness of the marketing strategies in designing a firm and
practical campaign.

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Ferrero Marketing Plan: Christmas Holiday Season 2010


Table of Contents Page No
Executive summary
1.0 -Introduction 3
2.0 --Situational analysis 4
2.1 ---Macro-environmental analysis 4
2.1.1 --- Political and legal 4
2.1.2 ---Economics 4
2.1.3 ---Socio-cultural 4
2.1.4 ---Technological 5
2.2 ---Micro-environmental analysis 5
2.2.1 ---Customers 5
2.2.2 ---The market 5
2.2.3 ---Competitors 6
2.3 --Internal Environment 7
2.3.1 ---Operating Result 7
2.3.2 ---Strategic issues analysis 8
2.3.3 ---Product portfolio 8
2.3.4 ---Marketing performance 9
2.4 --SWOT Analysis 11
3.0 - Marketing objectives 11
4.0 - Target market 12
5.0 -Product offerings 13
6.0 - Positioning 14
7.0 - Marketing mix 14
7.1 ---Product 14
7.2 ---Price 15
7.3 ---Place 15
7.4 ---Promotion 16
7.4.1 ----Communication strategy 17
7.4.2 ---- Communication message 17
7.4.3 ---- Communication tactics: tools 17
7.4.3.1 -----Advertising 17
7.4.3.2 ----- Public relations 18
7.4.3.3 -----Email marketing 18
7.4.3.4 -----Social media marketing 18
7.4.3.5 -----Sales promotion 18
7.4.3.6 -----Budget implementation and control 18
8.0 -Implementation and control 19
9.0 -Budget and financial forecast 19
10.0 -Conclusion 19
-Bibliography
-Appendices
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Ferrero Marketing Plan: Christmas Holiday Season 2010


1. Introduction
Ferrero is one of the major chocolate confectionery manufacturing companies in the
world. Over the past 20 years in the UK, Ferrero has spent over £50 million on
adverting (Ferrero, 2009). Between 2007 and 2009, boxed chocolate confectionery
and the sales value of different seasons grew by 2.1% to reach £1.3 billion.
However, much of this growth was driven by rising cocoa prices, as cocoa farmers
struggled to keep pace with increased demand from emerging markets (Mintel,
2010). In real terms, therefore, with the effects of inflation taken into account, the
seasonal and boxed chocolate market decreased by 3.1% over this period (Mintel,
2010).
Seasonal sales of chocolate confectionery are dominated by Easter chocolate
sales, with retailers depending on price discounts on Easter eggs to drive sales. New
product activity has offered consumers a wider selection of products at different price
points (Mintel, 2010). However, consumers are more likely to buy seasonal
chocolates for someone as a gift over Christmas, with the average spend on a box
likely to be £5.00-£9.99 (Mintel, 2010).
Today, companies have to prepare themselves for a new economy which is
characterized by globalization, hyper competition, technology and empowered
consumers than ever before. The old economy marketers worked on certain set
theories and principles, which were focused on internal efficiency and productivity.
Situational analysis has been taken forward to the match with the competitors and
their positioning in the market, followed by the strategies to cover the market in the
UK with the tastes of Ferrero products in the coming Christmas holiday season. Page29

Ferrero Marketing Plan: Christmas Holiday Season 2010


2. Situational analysis
2.1 Macro-environmental analysis

2.1.1 Political and legal

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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sales volume in the year.

Ferrero Marketing Plan: Christmas Holiday Season 2010


2.1.4 Technological

This market is highly standardized by labelling, packaging, production and hygiene,


and with the environmental concerns which always push manufacturing companies
to increase their technological innovation and implementation. For example,
NETZSCH, a manufacturer of chocolate production machines, recently introduced
their latest innovation, a series of chocolate manufacturing modules called
“ChocoEasy™”, which can produce any size and any variety of chocolate from
scratch in a cost-effective way (Foodprocessing-technology.com, 2010). Other than
the main issue of health and well-being staying constant in the food industry, as the
UK has the highest obesity rate, people are concerned about artificial colourings and
additives and are interested in the added natural fruit flavourings which push
chocolate companies to create new technologies continually.

2.2 Micro-environmental Analysis

2.2.1 Customers

A PEST (Political, Economic, Social and Technological) analysis illustrates that


throughout the recent economic slowdown, consumer expenditure and
disposable income rise. According to Mintel research (2010), “Value sales of
chocolate confectionery increased by 11.7% between 2007 and 2009”.
Nevertheless, the inflation effect caused sales to fall by 2.9%. Although the
chocolate confectionery penetration reduced, consumption frequency
increased by 8% between 2008 and 2010, as loyal customers found it an
“impulse affordable treat” (Mintel, 2010).
The basic reason for consumers to buy chocolate is to treat themselves and
parents also find it easy to buy treats for their children (Mintel, 2010). According to
Mintel (2010), women use chocolate to reward themselves, although there is
concern about the high fat and calorie level within chocolate confectionery. Despite
this, chocolate confectionery continues to be accepted within a large section of the
adult population, for example women and the under-45s consume sweets/chocolates
(Mintel, 2010). Furthermore, according to Mintel (2010), there is a close correlation
between travelling or driving and consuming sweets, which might increase the
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impulse buying behaviour before a journey.

Ferrero Marketing Plan: Christmas Holiday Season 2010


2.2.2 The market

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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Ferrero Marketing Plan: Christmas Holiday Season 2010


Cadbury Trebor Bassett (CTB)

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.

Ferrero Marketing Plan: Christmas Holiday Season 2010


Nestlé

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).

2.3 Internal Environment

2.3.1 Operating results

Although Ferrero experienced various economic difficulties and a slowdown, Ferrero


is the fourth-largest chocolate confectionery manufacturer in the world. In 2009,
Ferrero possessed a 4% market share in the UK market with a value of £125 million.
Within the 2007-2009 period, the Ferrero chocolate market share increased by 9.8%
(Mintel, 2010). Due to quality concerns recently in Canada, Ferrero recalled one of
its confectionery products, which has also happened in previous years. This
damages its brand image (Euromonitor International, 2010). On the other hand, the
small scale of operations can reduce the bargaining power of Ferrero compared to
its competitors, as Mars annually sells its products with record revenues of $22,000
million and, in contrast, Ferrero’s annual revenues are $9,142.9 million (Euromonitor
International, 2010).

2.3.2 Strategic issues analysis

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 Marketing Plan: Christmas Holiday Season 2010


Ferrero’s development strategy has been international expansion, as well as striking
a deal with hard discounters like Aldi and Lidl, which has been proven to be
successful (Euromonitor International, 2010). Ferrero has also always relied on
“organic growth for its market development, shunning acquisition opportunities”,
which has also proved to be successful (Euromonitor International, 2010). Ferrero is
focusing on mass-market development where they target everyone from children to
adult (Euromonitor International, 2010), for example the Kinder chocolate campaign
attempts to pull its target audience of 4 to 10-year-olds through the children’s
mothers (Mintel, 2010).

2.3.3 Product portfolio

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).

Raffaello: It is “made from swirls of silky-white praline wrapped around a whole


almond, encased in a crispy wafer shell and rolled in delicate flakes of fresh coconut”
(Ferrero UK, 2010). According to Ferrero UK (2010), it is very popular in Germany,
where they consume nearly 730 million raffaellos per year.

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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even as a dessert item.

Ferrero Marketing Plan: Christmas Holiday Season 2010


Other brands: Nutella which is one of the most preferred breakfasts spread in UK
and one of the favorite 'impulse' products in UK is Tic Tac which is easy-to-use and
unique with its different flavors like orange, mint, exotic cherry and passion fruit
flavor (Finweek, 2009).

2.3.4 Marketing performance

Promotion

The promotional strategy for Ferrero includes advertisements, event-marketing,


sales promotion and sponsoring. For example, in 2009 for Rondnoir they sponsored
Channel Four’s Desperate Housewives Series 5, and for Kinder Chocolate they also
tried to tie their campaign with 4 to 10-year-old children’s mothers (Mintel, 2010). In
2009, Ferrero spent £2.6 million on Kinder Bueno chocolate advertisements and
overall £1,670,000 has been spent by Ferrero on chocolate bars and countlines
advertising.

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,

Ferrero Marketing Plan: Christmas Holiday Season 2010


Sainsbury’s and Asda and a Fererro Rocher 200 g box costs £3.79. On the other
hand, a pack of Kinder Bueno costs £1.69 (Mysupermarket.co.uk, 2010). However,
inflationary pressures have let the price of raw materials (cocoa, milk, butter, etc.)
increase, which has put pressure on manufacturers to increase the price of their
products. According to Mintel (2010), although the product price is rising, the
increasing level of wealth will be beneficial for the confectionery market in the UK, as
this has an impact on treat spending.

2.4 SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis

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3. Marketing objectives

Ferrero Marketing Plan: Christmas Holiday Season 2010


The promotion is planned to carry its finest boxed variety, including the gift
assortment Ferrero Collection, as well as the newer add-ons, Ferrero Rondnoir and
Raffaello. Ferrero is looking forward to a penetration strategy with its products to
increase its sales.

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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2007). Parents have maintained control over the


purchase of chocolate confectionery, with just over one-

Ferrero Marketing Plan: Christmas Holiday Season 2010


third of children buying chocolate confectionery
themselves (Mintel, 2010).

Where to purchase Online purchasing can have substantial effects, which


can be viewed after changes in local retail options. “When
a store opens locally, people substitute away from online
purchasing, demonstrating that consumers appear to
respond to increased convenience in the offline channel”
(Forman et al., 2007).

Product end use Continuous female bias on chocolate confectionery


influences more products to have an ultimately female
positioning. In general, men show less interest in the
category, with the noticeable exceptions of king size and
standard size bars (Mintel, 2010). Just over one-quarter
of consumers are eating four or more types of chocolate
confectionery, with one-quarter sticking to just one type
(Mintel, 2010).

Media usage Just under one-fifth of young people have listened to an


international station of radio channel, with occasional
listeners outnumbering regular listeners by a ratio of
almost four to one (Mintel, 2010). As affluent, early
adopters, consumers will respond best to product-based
and performance claims, as well as marketing messages
which emphasize the “newness” and exclusivity of the
technology (Mintel, 2010). Alongside a fall in the number
of people who read magazines, the frequency with which
they read magazines has also slipped (Mintel, 2008).

5. Product offerings
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Ferrero Marketing Plan: Christmas Holiday Season 2010


This holiday season, whether it’s milk chocolate and hazelnut, one-of-a-kind dark
chocolates, or a delectable assortment of flavors, Ferrero offers beautiful gift boxes
that will make any holiday moment special (Ferrero, 2010). This Christmas, one
answer to buying a gift for someone can be Ferrero, with a wide variety of Rocher
choice. As a preamble to the special Christmas packs, the Ferrero Collection has a
mixture of attractive packs of 4.5 oz to 15.4 oz size (Ferrero, 2010). Almost two-
thirds of consumers buy boxed chocolates to give to someone as a gift for Christmas
(Mintel, 2010). There is, however, a limit on what consumers are willing to spend on
a box of chocolates, as over a £10-£15 threshold boxed chocolate begins to
compete with other gift items such as perfume (Mintel, 2010). Thus the products of
boxed chocolates will always receive preference during the Christmas season.
Specially-packed items with a symbolic Christmas shape (e.g. a bell) can attract
consumers who are concerned for their relatives or friends (Mintel, 2010).

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

Ferrero Marketing Plan: Christmas Holiday Season 2010


7.1 Product

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

Ferrero Marketing Plan: Christmas Holiday Season 2010


Ferrero follows retail channels for distributing throughout the market. An Internet
locator is also found in some retail chains.
The new Christmas packs will be visible during this Christmas holiday season
from around November 2010 to mid-January 2011, to ensure the availability of
Ferrero products at consumers’ nearest locations.

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).

1.1 Chocolate specialists

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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Ferrero Marketing Plan: Christmas Holiday Season 2010


Ferrero has invested in above-the-line campaigns in the build up to the Christmas
season (Mintel, 2010). The advertising campaign will act as a reminder to consumers
as they decide what gifts to buy.

7.4.1 Communication strategy

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.

7.4.2 Communication message

This could be conveyed by attracting consumers through “Christmas isn't Christmas


without Ferrero” (emotion) and “Ferrero has always been synonymous with
Christmas, for family and friends” (see Appendix 1).

7.4.3 Communication tactics: tools

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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Ferrero Marketing Plan: Christmas Holiday Season 2010


Various media channels are in use to promote the brand and its values to draw the
attention of the consumers who love to share memories with their close ones this
Christmas. Frequencies and appearances of advertisements are given in detail in
Appendix 2.

Print

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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7.4.3.2 Public relations

Ferrero Marketing Plan: Christmas Holiday Season 2010


With a vision to reach the hearts of the chocolate lovers who also care for the
organization and its philanthropic activities, Ferrero will also emphasize the market
visibility. As part of the deal, “Holden held a Christmas carol night last year at
Westfield Shopping Centre beneath the brand’s giant Christmas tree” (Pitch, 2010).
This is one way to communicate with consumers by staying at their level.

7.4.3.3 Email marketing

Consumers purchasing Ferrero products online could be contacted by email to


remind them that they are really going to miss something this Christmas by not
ordering a Ferrero item.

7.4.3.4 Social media marketing

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.

7.4.3.5 Sales promotion

Sales promotions of this kind are intended to be for a short period of time only.

Cash discounts

Availing consumers’ attention of discounts according to pre-set criteria of purchase


or frequency of purchase is the key to increasing sales at point of sale.

7.4.3.6 Budget implementation and control

For a detailed budget and roll-out plan, see Appendices 3 and 4.

8. Implementation and control


Marketing plan implantation has to go along with the overview of the implantation
phases and the stakeholders’ strategies to implement the issues at different points of
the implementation timeline. Project members’ responsibilities for the various parts of
Page29

this plan have been illustrated briefly in Appendix 5. To achieve the best possible

Ferrero Marketing Plan: Christmas Holiday Season 2010


outcome, a logical approach is essential for developing and executing the strategies.
What we, as Marketing Manager have looked at so far represents the necessary
background for the development of sound marketing plans and marketing planning
procedures (Kahle and Chiagouris, 1997). Local tastes for Ferrero have been taken
under consideration during implementation plans. Although local tastes remain an
important influence on advertising, the underlying argument of standardization is still
valid (Kahle and Chiagouris, 1997).

9. Budget and financial forecast


Ferrero has £5 million to make the campaign successful in the coming Christmas
holiday season. Budget allocation has been illustrated briefly in Appendix 6.

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.
Page29

Ferrero Marketing Plan: Christmas Holiday Season 2010


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Ferrero Marketing Plan: Christmas Holiday Season 2010


Appendix 1: Promotional Strategy – Communication message – Descriptions
The advertising message is “Christmas isn't Christmas without Ferrero” (emotion).
An emotional message has been sent through this message as this is the opening of
the advertisements and consumers may think they are going to miss something very
special this Christmas.

Another message to be delivered is “Ferrero has always been synonymous with


Christmas, for family and friends”. Consumers who care for their family and friends
will find something they are really looking for and will receive through the products of
Ferrero. An emotive attachment has been created with this message as this is a
message about family and friends. These are the people who are always very close
to anyone’s life.

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Ferrero Marketing Plan: Christmas Holiday Season 2010


Appendix 2: Frequencies and appearances of advertisements
2010 2011
Marketing
Communication
Tools Frequency October November December January
1 1 2 1 2 2 1 2 1 1
4 1 8 5 1 8 5 2 9 6 7 3 0 3 0 7 24
1 Advertising
1 full-page,
1.1 Print: magazines 4/c
1.1.1 The
Foodie List 1 / month
1.1.2 Vanity Fair 1 / month
1.1.3 Readers
Digest 1 / month

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
Page29

Banner and
1.5 Online content ad.

Ferrero Marketing Plan: Christmas Holiday Season 2010


1.5.1 Facebook During the
whole term
1.5.2 Youtube During the
whole term
1.5.3 MySpace During the
whole term
1.5.4 Twitter During the
whole term
1.5.5 Sky During the
whole term
1.5.6 BBC Online During the
whole term
During the
1.5.7 NME
whole term
During the
1.5.8 MSN
whole term

1.6 Comic magazines 1 / week

2. Public Relations
2.1 Media relations:
press release 4

3. Direct marketing
3.1 E-mail marketing 1 / week

3.2 Internet marketing


3.2.1 Online During the
advertising whole term
3.2.2 Promotion
on
Facebook,
MySpace
and During the
Twitter whole term

4. Sales promotion
4.1 Cash discounts ---

5. Campaign
research
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Ferrero Marketing Plan: Christmas Holiday Season 2010


Appendix 3: Budget planning – marketing communication activities
Amount (£)
1 Advertising 227,000
1.1 Design 5,000
1.2 Administration 3,000
1.3 Placing advertisements
1.3.1 Print 45,000
1.3.2 Outdoor 40,000
1.3.3 TV 110,000
1.3.4 Radio 11,000
1.3.5 Online 9,000
1.3.6 Comic magazines 4,000

2. Public relations 8,000


2.1 Conduct press release 3,000
2.2 Administration 2,000
2.3 Enhancement of media database 3,000

3. Direct marketing 8,000


3.1 E-mail marketing 2,000
3.1.1 Conduct newsletter
3.1.2 Administration

3.2. Online advertising 3,000

3.3. Promotion on Facebook, Twitter and


MySpace 3,000
3.3.1 Conduct information on sites
3.3.2 Administration

4. Sales promotion 40,000

5. Campaign research 17,000

Total 3,000,000
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Ferrero Marketing Plan: Christmas Holiday Season 2010


Appendix 4: Budget planning – marketing roll out plan
2010 2011
Responsibilities Responsible Staff October November December January
2 2 2 1 1
4 11 18 25 1 8 15 2 9 6 7 13 0 3 0 7 24
1. Product Product Manager
Packaging
1. Design
2. Production

Labelling
1. Design
2. Print

2. Distribution Logistics Manager


2.1 Transport of
inventory
2.2 Warehousing
2.3 Distribution service
2.4 Administration
2.5 Delivery to the
retailers

3. Price Product Manager


3.1 Administration
3.2 Quantity discount

4. Promotion Marketing Manager


4.1 Advertising
4.2 Public relations
4.3 Direct marketing
4.4 Sales promotion
4.5 Campaign research

Market Research
5. Market Research Manager
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Ferrero Marketing Plan: Christmas Holiday Season 2010


Appendix 5: Budget planning – marketing plan
Marketing Activity Percentag Amount
e (%) (£)
1. Product 16 800,000
1.1 Packaging
1.1.1 Designer
1.1.2 Material
1.1.3 Production

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

5. Market research 4 200,000

Total 100 5,000,000


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Ferrero Marketing Plan: Christmas Holiday Season 2010