NUTELLA REPORT
Table of Contents
1.0 Introduction
Main body
2.0 Consumer behaviour theory
2.1 How Nutella uses target market information to influence the decision-making process
2.2 How a family decision making unit can encourages purchase
2.3 How values and attitude encourage purchase
3.0 Marketing mix
3.1 Product
3.1.2 price
3.1.3 promotion
3.1.4 Place
4.0 conclusion
Reference
Appendices
Evaluates a consumer favourite
1.0 Introduction
This report is an evaluation of Nutella, discussing its target market along with how Nutella uses their consumer behaviour theory and marketing mix analysis to persuade consumers to purchase Nutella for their household. Nutella was created by The Ferrero Group; their history shows their success as the group has been around for three generations. The invention of Nutella was an innovative solution to the shortage of cocoa and now it’s a well-known household brand which is enjoyed by all ages. Nutella has a mass following and love, as fans united to dedicate one day to their favourite spread February 5th, 2007 (World Nutella Day, 2018)
Main body
2.0 Consumer behaviour theory
This section of the report will focus on consumer behaviour theory and how Nutella utilises the theory to retain their customers along with attracting new customers. Consumer buyer behaviour can be identified as the consumers’ final decision of buying goods and services for personal consumption (Kotler et al, 2017) The Ferrero Group understanding of this theory will ensure the company’s success of Nutella with their existing customers and potential ones.
2.1 How Nutella uses target market information to influence the decision-making process
Nutella has a wide demographic; allowing them to market to several different age groups. Nutella’s most popular age groups are under 24, 35-44 and 45-55 (Appendix 1). The Nutella target market is children and families, this can be seen by their campaign “wake up to Nutella”. This campaign has been around since 2007 – the advertisement called ‘toaster dance’ (Appendix 2) aimed to attract parents by expressing balanced diets for their children when using Nutella for breakfast.
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On 5th February 2007, Nutella had a day dedicated to them all over the world (World Nutella Day), which was made possible through fans petitioning, this shows that Nutella has a huge target market to exploit as it also consists of people who love chocolate. World Nutella Day has been a massive success as it shows how Nutella’s following Is expanding as the website encourages people to try Nutella through honest reviews. Nutella has done collaborations with famous YouTubers that aim to spread the word. This year Nutella team up with Alfie and Zoella to create a vlog which includes them using Nutella to create a feast of deserts. (Appendix 3).
Nutella needs to understand their target market information and how it will affect the consumers’ behaviour decision-making process as it would aid them in better marketing strategies. Appendix 4 shows how a decision-making process is analysed by a consumer, it states the five stages of influences need to be considered before a purchase is made and after. There can be some modifications to the stages as the consumers tend to skip stages regarding routine purchases. Consumers that purchase Nutella regularly would skip the stages, as they know the satisfaction the brand brings to them compared to another. This can be seen in the number of sales that Nutella make every year. Nutella shows their impressive sales through classics architecture that is well known by consumers (Appendix 5).
2.2 How a family decision making unit can encourages purchase
Family members can influence the consumer buying behaviour as each member task will differ depending on the items being purchased. When shopping as a family, the main shopper does not act as an individual, as they need to consider others in the family and incorporate their needs and taste (Brassington and Pettitt, 2013). In the family the parents will ultimately be the purchaser and decider of the products; this is seen in figure 1 through the ‘family decision making unit’ diagram. It shows that the rest of the family will take the additional roles such as the user or influencer. Nutella needs to be aware of the power which the family decision-making unit can have on product purchase, as this is important to help increase sales. This means they need to market their products correctly to attract potential families as well as keeping the existing ones. Nutella’s target strategies are to market the product to children which creates an initiator in the family this will then encourage purchase.
Figure 1- family as a decision-making unit
Source: Brassington and Pettitt
2.3 How values and attitude encourage purchase
Value is described as a belief regarding a desirable destination and guides selection of behaviour (Solomon et al,2016). Nutella’s values can be clearly seen in their reports (Appendix 7). An important ingredient to make Nutella is cocoa, Nutella makes sure that their cocoa is done through the World Cocoa Foundation a non-profit organisation that empowers their farmers and communities while also promoting human rights and conserving the environment (world cocoa foundation). A company’s values are significantly important as consumers will consider this factor when purchasing the products or even remaining with the company. As Nutella’s value is to provide their customers with the best product through making sure that their materials used are from an ethical background with a long history will encourage purchasing of Nutella as consumer values have been achieved.
A consumer can develop a certain attitude towards a product or service; these attitudes will affect the buyers’ behaviour. This shows the importance of how attitude can influence consumer judgement, whether it’s through perception, evaluation or even decision-making process (Brassington and Pettitt, 2013). There are different types of attitudes the consumer could have towards a product or service; there is a cognitive attitude, and this relates to the consumer’s beliefs or disbelief. A consumer might understand Nutella’s campaign and agree that the product is healthy for their family to have. Using correct marketing strategies and relaying the intended information Nutella was able to convince the consumer of the benefit Nutella would bring to their household. Since Nutella’s message was correctly understood the consumer would be more willing to purchase the product along with recommending the product to others furthering Nutella’s sales.
McDonald and Meldrum (2013) described the marketing mix as the main demand influencing variables that are available to an organization. Since the consumer will be making a purchase with the supplier, they will be responding to a wide range of variables that are unknowingly attached. The marketing mix is further broken down into the four P’s; product, price, promotion and place.
3.1 Product
The product is seen as a physical good or service that can offer tangible or intangible attributes that are viewed necessarily for a person or organization, that is worthwhile that the consumer is prepared to exchange money to acquire the item (Brassington and Pettitt, 2013). The Ferrero group are exchanging their consumers a tangible good; the consumer recognises the satisfaction the product will bring and are willing to exchange cash to purchase the convenience good which is Nutella.
From consumer response through sales of the product, the marketers can assess if they have achieved their objective along with marketed the product to the correct target market. This can be done through a product life cycle, this was created by Raymond Vernon is 1966 an American economist. The diagram shows stages a product is in there are four stages, these are introduction, growth, maturity and decline. A product will experience different levels of success in its life depending on which stage it’s in. If the product is in the early stages, then the success is different compared to maturity. Figure 1 below shows which life stage Nutella is currently in.
Figure 2 – Nutella lifecycle
Source: https://geileon.com/blog/product-life-cycle-marketing-management-introduction/
Figure 3 Nutella packaging
Source: https://www.amazon.com/Ferrero-Nutella-Hazelnut-Spread-26-5/dp/B008TMIO2M
Packaging is interesting as Nutella is spelt with 2 different colours black and red. By doing this the brand is eye-catching and helps the brand differentiate from other brands. These colours would be able to recognise world-wide due to the company’s outstanding reputation.
3.1.2 price
Brassington and Pettitt (2013) define price as being a value that is placed on something, that a consumer is willing to purchase to acquire something else. The most common way to measure price is through money, as it’s the most convenient medium of exchange that requires a set price. Before a consumer purchases an item, they weigh up price against their need to see if it’s necessary. The factors that consumers weigh up before making their decision is shown in figure 2 below:
Figure 4 – factors for consumer weigh up
Brassington and Pettitt
These factors would be considered before the consumer buys Nutella. For example, functionality Nutella would bring to their life, resulting in saving time for breakfast. The personal benefit could be bringing them comfort due to the rich chocolate in the product. With all these factors the financial factor of the product would outweigh the rest, as different retailers sell the product at different prices (appendix 8).
3.1.3 promotion
Promotional mix is where a company such as Nutella would attempt to directly communicate to their target market, through five different marketing communications. These are advertising, sales promotion, personal selling, public relations and direct and digital marketing. This can be seen in figure 3 below:
Figure 5 – Source: Brassington and Pettit, 2013
The promotional mix is used to promote consumer products in the most efficient way, through these mediums. However, the communications would be used in different levels depending on the product. Nutella’s communication would be all 5, but personal selling would not be a massive factor due to Nutella being a fast-moving consumer good also not durable. Nutella mostly use advertising to promote their products to their consumers through television adverts, bus stop poster etc. This allows them to attract an audience on a bigger scale compared to direct marketing. The main purpose Nutella would use the promotional mix is to make sure that their consumers receive the correct message regarding the product.
3.1.4 Place
Marketing channel allows the product to be available for the consumer to buy the product as there is a place established for them to do so. The channel includes different members that make it possible for the product to be sold to the consumer. Figure 4 below shows the different members that are involved.
Figure 6- Source: Brassington and Pettitt, 2013
Nutella’s distribution channel includes producer, retailer and consumer. Nutella would need an intermediate to sell the goods to the consumer, as they do not have another way to provide the consumer with the product. Nutella’s intermediates would be the retailer, this is where the goods would be sold; Nutella has lots of different retailers from the low end and high-end super, hypermarkets and even sold online (appendix 9). Due to the mass places consumers can purchase Nutella, this encourages sales of the product as the most store would have the product.
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In conclusion, the report discussed Nutella’s most common target markets and how they encourage the sector to purchase Nutella and external factors that are controlled by the consumer and the consumer’s behaviour towards purchasing goods, and how a company such as Nutella can have an influence on the consumer so that they would purchase the product. The report also discusses Nutella’s own external factors that they would have to manage so that they keep succeeding in their market this was seen through the marketing mix in this is shows the different factors that Nutella would have to be conscious about.
Brassington, F. and Pettitt, S. (2012). Essentials of marketing. 3rd ed. PEARSON.
Ferrero, R. (2016). Ferrero – Key Figures. [online] Ferrero.com. Available at: https://www.ferrero.com/the-ferrero-group/business/key-figures [Accessed 15 Oct. 2018].
Ft.com. (n.d.). Ferrero’s chocolate fortunes face consumer taste test | Financial Times. [online] Available at: https://www.ft.com/content/b244b9a6-2040-11e7-a454-ab04428977f9 [Accessed 25 Oct. 2018].
Geile/Leon Marketing Communications. (2016). The Product Life Cycle: A Guide from Start to Finish | Geile/Leon Marketing Communications. [online] Available at: https://geileon.com/blog/product-life-cycle-marketing-management-introduction/ [Accessed 25 Nov. 2018].
Hogg (n.d.). Decision Making Process. [online] Slideshare.net. Available at: https://www.slideshare.net/bob.hogg/decision-making-process [Accessed 13 Nov. 2018].
Kotler, P., Armstrong, G., Harris, L. and Piercy, N. (2017). Principles of marketing. 7th ed.
mySupermarket. (2018). Buy Nutella Hazelnut Chocolate Spread (400g) online in ASDA at mySupermarket. [online] Available at: http://www.mysupermarket.co.uk/asda-compare-prices/Jam_And_Spreads/Nutella_Hazelnut_Chocolate_Spread_400g.html [Accessed 7 Dec. 2018].
mySupermarket. (2018). Nutella hazelnut chocolate spread. [online] Available at: http://www.mysupermarket.co.uk/asda-compare- [Accessed 5 Dec. 2018].
Nutella.com. (2016). Did you know. [online] Available at: https://www.nutella.com/en/uk/did-you-know [Accessed 22 Nov. 2018].
Provenmodels.com. (2005). ProvenModels – international product life cycle – Raymond Vernon. [online] Available at: https://www.provenmodels.com/583/international-product-life-cycle/raymond-vernon [Accessed 7 Dec. 2018].
Snapshot.numerator.com. (2019). Nutella Demographics and Consumer Insights | Numerator. [online] Available at: http://snapshot.numerator.com/brand/nutella [Accessed 20 Nov. 2018].
Solomon, M., Bamossy, G., Askegaard, S. and Hogg, M. (2016). Consumer Behaviour: A European Perspective. 6th ed. Pearson.
Superbrands.co.il. (2019). NUTELLA. [online] Available at: http://www.superbrands.co.il/pdf/2011/nutella_en.pdf [Accessed 22 Nov. 2018].
ToolsHero. (2018). Product Life Cycle Stages theory by Raymond Vernon | ToolsHero. [online] Available at: https://www.toolshero.com/marketing/product-life-cycle-stages/ [Accessed 4 Dec. 2018].
World Cocoa Foundation. (2018). About WCF | World Cocoa Foundation. [online] Available at: https://www.worldcocoafoundation.org/about-wcf/ [Accessed 24 Nov. 2018].
World Nutella Day. (2018). World Nutella Day. [online] Available at: https://www.
nutelladay.com/ [Accessed 4 Oct. 2018].
Writer, S. (2019). Ferrero invests £8m to reposition Nutella. [online] Talking Retail. Available at: https://www.talkingretail.com/products-news/ferrero-invests-8m-to-reposition-nutella-29-08-2007/ [Accessed 17 Nov. 2018].
Appendices
Appendix 1
Source: http://snapshot.numerator.com/brand/nutella
Appendix 2
Source: https://www.youtube.com/watch?v=9FAykxoBPV4
Source: https://www.natriciabernard.com/showreel/commercials/nutella/
Appendix 3
Source: https://www.nutelladay.com/
Appendix 4
Source: https://www.slideshare.net/bob.hogg/decision-making-process
Appendix 5
Source: https://www.nutella.com/en/uk/did-you-know
Appendix 6
Source: http://www.superbrands.co.il/pdf/2011/nutella_en.pdf
Appendix 7
Source: http://www.mysupermarket.co.uk/asda-compare-prices/Jam_And_Spreads/Nutella_Hazelnut_Chocolate_Spread_400g.html
Appendix 8
Source: https://www.mysupermarket.co.uk/brands/Nutella_in_Lidl.html
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