kit kat

Developing and Implementing Product Strategies Kit Kat

KIT KAT Have a Break, Have a Kit Kat

Introduction: Most of us love chocolate in one form or another and every week a typical UK citizen spends around £1.80 on it. Amazingly, UK consumers have a choice of over 5,000 chocolate lines available from 150,000 outlets. Because it is so widely and readily available, i tend to take chocolate for granted, and few of us probably ever consider what is involved in producing it. . The UK has long been a major manufacturer (and consumer) of chocolate products. All over the world you will find prominent brands first developed in the UK e.g. Smarties, Dairy Milk, Aero and of cmyse Kit Kat (the UK's Number 1 selling confectionery brand since 1985). Three producers dominate the chocolate market. Cadbury with around 28% while Mars and Nestlé each have around 24%. Sales of milk chocolate (96%) predominate, with plain and white chocolate accounting for about 2% each. Boxed chocolates such as Quality Street make up 15% of the confectionery market. Blocks and bars like Kit Kat and Yorkie account for 65% and bitesize chocolates e.g. Smarties and Rolo make up 10%. Easter eggs are another big seller, accounting for 5% of the market. The UK's chocolate industry is over 150 years old. Chocolate manufacture provides steady employment and job security for tens of thousands of employees in manufacturing locations like York and Birmingham. The industry also generates jobs in marketing, administration, transport and storage. Chocolate sales are an important smyce of income for many retailers Kit Kat was launched in 1937. Since then, it has consistently been one of the best selling chocolate bars on the market and has acquired an instantly recognizable brand name and identity. In 1997, British sales of Kit Kat amounted to some £227 million, which made it easily the most popular confectionery product on the market. Forty-fmy Kit Kats are consumed every second in the UK The UK confectionery market is worth over £5 billion per annum and is highly competitive. It continues to be dominated by large, well-established names - highlighting the importance to firms of creating brand identities for their products. Once created, however, a brand name needs constant maintenance. Kit Kat's ability to remain a brand leader over sixty years is no accident. The long term maintenance of a brand name requires continuous monitoring and investment. Brand image must be seen as a dynamic, not a

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Developing and Implementing Product Strategies Kit Kat static factor; the same consumer perceptions that create brand loyalty can also turn against a product that fails to adjust and adapt to changing attitudes. This case study focuses on Nestlé's Kit Kat and the long-term brand name maintenance strategies, which have sustained Kit Kat's position as a market leader for over sixty years. The major stakeholders in are: • • • •

•

shareholders, who want a dividend from profits employees, who want job security and the necessary training and development to allow them to further their careers with Nestlé consumers, who want products that better meet their needs, that are available in the right places and at the right price business partners, who want long-term and trusted relationships local and national economies within which Nestlé operates.

Kit Kat corporate objectives: It is vital to any firm that its marketing objectives are compatible with the overall corporate objectives. In selecting corporate objectives and strategy, a firm might wish to refer to the Boston Matrix, Ansoff's Matrix or use a simple SWOT analysis to establish where the company is and in which direction it wishes to head. For example, a company planning to consolidate its position within a national market might set very different objectives for the marketing of its products to a company wishing to expand into international markets. This in turn would affect the marketing tactics each company might employ. Nestle corporate objective is to be the world's largest and best branded food manufacturer, whilst ensuring that the Nestlé name is synonymous with products of the highest quality. In recent years, the company has pursued a policy of expansion and diversification through acquisition and divestment to achieve a more balanced structure to the business. Global brand names can achieve substantial production and purchasing economies of scale and, as world travel increases, so does the importance of instantly recognizable products. With a product portfolio which includes eight of the thirty top selling confectionery brands, such as Quality Street, Aero, Smarties, Polo and Rowntree's Fruit Pastilles, Milky Bar and After Eight, it is extremely important that the marketing objectives for each product line are fully compatible with the overall objectives of the company as a whole. Like any group of individuals, each product has its own character, strengths and weaknesses and consequently, the marketing objectives of each product need to be specifically tailored. • • •

Corporate Level – No Longer Just Chocolate – Acquisitions Business Level – Differentiation Functional Level 2

Developing and Implementing Product Strategies Kit Kat –

New Product

Why need of launching KIT KAT new product? Every alert, market-focused producer recognizes the need for regular change. This is required because: • consumers want and demand change • rival firms are constantly re-inventing themselves and their products • Innovation and inventiveness keep an organization flexible and able to respond to further change.Marketing objectives and strategy. So that Kit Kat launches a new product that is “Kit Kat Chocolate Balls” with different flavors

Kit Kat has a particularly broad consumer profile and is popular with all age groups. The Kit Kat marketing strategy can be summarized by the line 'Broad in appeal, young in feel and big in stat.

Market Overview Market share market size and market trend include in market overview.

Market Share: Nestlé employs approximately 253,000 people in some 511 factories worldwide. Nestlé is not only Switzerland's largest industrial company, but also the world's largest food company, considerably larger of than its nearest rivals Kraft Foods Inc. and Unilever plc. 1. With products like Perrier and Nescafé, it is the market leader worldwide in coffee and mineral water,

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Developing and Implementing Product Strategies Kit Kat 2. The largest manufacturer of pet food, and is fast increasing its share of the ice cream market. 3. Nestlé acquired Ralston-Purina, a US pet food company, in 2001. Despite producing pet food through its subsidiary, Carnation, since 1985. 4. This acquisition now sees it outstrip Mars as the world's largest pet food manufacturer. Not to be outdone by Unilever's acquisition of Ben and Jerry's, Nestlé's merger with US food corporation Dreyer's to form the Dreyer's Grand Ice Cream Company in 2003 has given it the number one spot in the US ice-cream market, having already bagged the Häagen Dazs, Schöller and Mövenpick brands. Globally, Nestlé is now hot on the heels of Unilever as the number one ice cream seller, a position that it seeks in every market and category in which it operates around the world. Nestle plans to take market share away from its rivals in the crowded 1.4 billion Rs snack/energy bar category with a 9 million national print, outdoor and sampling campaign it hopes will separate its PowerBar Pria bars from the pack, reports A print effort in women's fitness and general interest titles will target active women later this year to drive trial and awareness of Pria's six flavors. Nestle acquired the brand in 2000 and launched PowerBar Pria to cater to consumer demands for a quick-energy snack based on research showing that women's energy needs were not being met with the typically dense large-size energy bars.

Marketing trends: • • • • • •

Retailers Going Upscale Marketers Use All Routes Mass/Class Barriers Breaking Down Leveraging Brand Equity Partnerships as Competitive Advantage The Importance of Packaging

Market size: Products & Services Product/Services Share Candy bars Industrial chocolate Block chocolate Box chocolates Cocoa drinking powders Other cocoa based candies Chocolate spreads

30% 20% 15% 10% 10% 10% 5%

Kit Kat Market Size:

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Developing and Implementing Product Strategies Kit Kat sahre

24%

30%

Cadbury Kit Kat Mars others

21% 25%

Three producers dominate the chocolate market. Cadbury with around 28% while Nestlé has around 24% and Mars have 20%. Sales of milk chocolate (96%) predominate, with plain and white chocolate accounting for about 2% each. Boxed chocolates such as Quality Street make up 15% of the confectionery market

Internal Audit: 4P’S of kit kat Product strategy No matter how effective the promotion and packaging, a firm will find it very difficult to market a product which fails to satisfy a consumer need. Kit Kat owes much of its success to a unique dual appeal as a four-finger chocolate bar, (known in the confectionery trade as a count line), sold at corner shops and newsagents, but also as a two-finger biscuit sold in supermarkets. A product has endured because of its wide appeal across the age ranges and to both sexes. Altering the actual product is potentially a very hazardous act for an established brand name as it risks altering the consumer perceptions of quality built up over decades. Tampering with the recognized core qualities could well damage the integrity of the brand. For Kit Kat, these intrinsic elements of the brand, or unique selling points include the: • • •

chocolate fingers foil and band wrapping, unique in the count lines market and seen as an important feature which encourages involvement and sharing by consumers Well-known strap line - Have a Break, Have a Kit Kat.

In spite of the risks of altering the product, the two finger bar and multipacks were introduced in the 1960s to meet the increased needs of supermarket shopping and more recently, Orange, Mint and Dark Chocolate Kit Kats have been available for limited periods. In the third week that Kit Kat Mint was available, it more than doubled total Kit Kat Sales. The Orange Kit Kat proved particularly popular with sales of 38 million bars in 5

Developing and Implementing Product Strategies Kit Kat just three weeks. It provided very positive market research results. While they are seen as novelties, they can also be used to provide reassurance and reinforcement of the core attributes of the original established brand name. Pricing strategy A key advantage of maintaining a strong brand image in a competitive market is a degree of flexibility in the pricing strategy. It is a common characteristic of imperfectly competitive markets for producers to concentrate on non-price competition. When looking at the pricing strategy for Kit Kat, it can be seen from the figures that the real price has remained remarkably stable over the last sixty years. Promotional strategy Nestlé has used a wide range of promotional tactics with Kit Kat. Promotion offers have included free bars in the multi-bar family packs and an instant win deal with Burger King in 1996. This promotion, where over 75 million free burgers were on offer, increased sales of Kit Kat by an estimated 30 In 1998, an on-pack promotion featuring 'The Simpson’s,' with the chance to win 20,000 cash and hundreds of other prizes, increased sales of Kit Kat by a staggering 41 Advertising plays an extremely important part in the confectionery industry; with spend approaching £114 million in 1996. The Have a Break, Have a Kit Kat theme appeared briefly in 1939, but has been the on-going Kit Kat slogan, or strap line, since the mid 1950s. Kit Kat's advertising is concentrated in two media: • •

television commercials - which follow the well-known Have a Break tradition Posters - where the powerful colors of the pack and product are used to dramatize the message.

A particular challenge for the advertisers is to appeal to both the consumers and the purchasers. Women account for two thirds of all confectionery sales, but a large proportion of these purchases are subsequently consumed by children. Men eat as much as they purchase suggesting they are less generous. Place strategy Nestlé has developed distribution channels, which ensure the availability of Kit Kat to buy wherever and whenever the consumer wishes to purchase it. Sales of confectionery depend heavily on its availability, with market research showing that well over 60of all purchases are made on impulse. Consequently, Nestlé tries to supply as many outlets as possible both wholesaler and retailer channels. Point of sale merchandising is also important when consumers are making instant, snap decisions from a wide range of products on view. Instantly recognizable packaging also helps to tempt customers. Shoe shops, for example, have recently been identified as having potential for confectionery sales owing to the large number of families that visit them. It is also predicted that confectionery, along with all foodstuffs, will become available through cable and interactive television, videophones and the Internet. 6

Developing and Implementing Product Strategies Kit Kat Internationally, Kit Kat is now also manufactured in Canada, Germany, India, Malaysia, China, Japan, Australia, South Africa and the United States. It is available in more than 100 countries throughout the World.

External Audit: Competitors Analysis 4P’S OF Competitors: The primary competitors for Kit Kat will be among the Cadbury “Mars Inc “Twix” and”. Among these three competitors, the most popular will be the “Time Out”. However, mostly still prefers Kit Kat. Although Cadbury had been famous for its original milk chocolate, yet still when it comes to the snack bars, Kit Kat will be the first choice. Hence, i can see that the competitors trying to improvise the original wafer coated with milk chocolate with other ingredients, such as “Time Out” which inserted flakes, “Twix” combined with caramel flavor and. So their key differences from Kit Kat will be the ingredient. Consequently, from all the competitors, their promotion and marketing approach are using their key differences of unique selling point (their key ingredient) to differentiate themselves. Product: Consumers are definitely becoming more design conscious, demanding that goods are not only functional but are aesthetically pleasing. Lifestyles affect products and their packs, more people are eating on the move creating opportunities for chocolate bar-lines to compete in the snack market. Thus, comparison from all the competitors packaging, Kit Kat did a good job with their product picture snap shot in front of their packing which give a clearer meaning of what type of confectionery chocolate bar. On the same time, their gold packaging is not that appealing. Place: From their marketing system, Cadbury tends to go towards the placement of their product. The key term will be “location, location, location”. Normally, their product will be placed on the middle shelf where it is the same eye level of most consumers (adults to teenagers). As for “Twix” they are not that concerned of their product placement, but their brand product of Mars Inc that carried all the way of recognition. Same as “Kinder Bueno”, they are not too concern on their product placement but their highly recognized brand of Ferraro that help to maintain their sales.

Price While Kit Kat on the other hand, promote their product by inducing a lower price compare to the competitors. It might be from the reason of their manufactured ingredients which are mostly local that help them to lower down their price. This is their strength, because in the supply and demand mechanism, when the price is low, demand tends to go up (Who do not like cheaper price when it served the same purposes).

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Developing and Implementing Product Strategies Kit Kat

Consumer Audit: My resulted in the launch of Kit Kat Chunky, a super size Kit Kat finger with a real mouthful of chunky milk chocolate. This 'heavyweight' idea assumes that younger consumers are looking for novelty, interest and even excitement when they buy a chocolate bar. While most of us are loyal to the chocolate products i buy regularly, i also seek novelty. To find out exactly what consumers were looking for, Nestlé carried out detailed market research, including detailed qualitative research. Many pairs of young people were invited to give their views on different formats for the new product e.g. whether they preferred one or two fingers, what flavors they preferred (caramel, peanut butter, orange jelly, chocolate layers etc). Researchers also considered the most appropriate form of packaging to add further interest and attraction to the product. Other forms of market research included group discussions with young people who, typically, were regular consumers of chocolate bars. A survey group might consist of, for example, males and females who were: • • • •

17, 18, 19 or 20 years old Of different ethnic origin From different parts of the UK A mix of students and non-students.

Using focus groups in this way, researchers were able to compile data on the views and feelings of representative samples of the targeted groups of consumers. The research provided clear evidence that: • •

The targeted population of 12-20 year olds were attracted to the idea of the single Chunky finger Kit kat could be a winner.

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Developing and Implementing Product Strategies Kit Kat The research also identified the type of packaging with the greatest appeal - a mainly red and silver flow wrap. It also became clear that Kit Kat ChunKy would inject new interest in Kit Kat across a broad range of consumers, including young children and older adults. The research examined different types of wrappings and formats. In particular, it compared two-finger and single-finger variants of Kit Kat.

SWOT (Strength, Weaknesses, Opportunities and Threats): Strengths: Parent support: Nestle Pakistan has a strong support from its parent company, which is the world’s largest processed food and beverage company, with a presence in almost every country. The company has access to the parent’s hugely successful global folio of products and brands. Brand strength: In Pakistan, Nestle has some very strong brands like Nescafe, Maggi and Cerelac. These brands are almost generic to their product categories. Product innovation: The Company has been continuously introducing new products for its Pakistani patrons on a frequent basis, thus expanding its product offerings. Weaknesses: Exports the company’s exports stood at Rs 2,571 m at the end of 2003 (11% of revenues) and continue to grow at a decent pace. But a major portion of this comprises of Coffee (around 67% of the exports were that of Nescafe instant to Russia). This constitutes of the total exports to a single location. Historically, Russia has been a very volatile market for Nestle, and its overall performance takes a hit often due to this factor.

Supply chain - The Company has a complex supply chain management and the main issue

for Nestle Pakistan is traceability. The food industry requires high standards of hygiene, quality of edible inputs and personnel. The fragmented nature of the Pakistani market place complicates things more.

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Developing and Implementing Product Strategies Kit Kat Opportunities: Expansion: The Company has the potential to expand to smaller towns and other geographies. Existing markets are not fully tapped and the company can increase presence by penetrating further. Product offerings: The Company has the option to expand its product folio by introducing more brands, which its parents are famed for like breakfast cereals, Smarties Chocolates, Carnation, etc. Global hub: Since manufacturing of some products is cheaper in Pakistan than in other South East Asian countries, Nestle Pakistan could become an export hub for the parent in certain product categories. Threat: Competition: The Company faces immense competition from the organized as well as the unorganized sectors. Off late, to liberalize its trade and investment policies to enable the country to better function in the globalize economy; the Pakistani Government has reduced the import duty of food segments thus intensifying the battle. Changing consumer trends: Trend of increased consumer spends on consumer durables resulting in lower spending on FMCG products. In the past 2-3 years, the performance of the FMCG sector has been lackluster, despite the economy growing at a decent pace. Although, off late the situation has been improving, the dependence on monsoon is very high. Sectoral woes: Rising prices of raw materials and fuels, and inturn, increasing packaging and manufacturing costs. But the companies’ may not be able to pass on the full burden of these onto the customers.

PEST (Political, Economical, Social, and Technological): Political: • If the national income went down people would have less money to spend on luxury items such as chocolate that it was better for exporting. Economical: • The foreign product line is often smaller than the Pakistani product line because of financial and market limitations Social: • If the population size decreased then there would be less people to buy their products therefore less profit. • If peoples lifestyles changed e.g. more people wanting to get fit and lose weight, then they will stop eating chocolate and spend there money on gym memberships etc. This means that KIT KAT profits will decrease.

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Developing and Implementing Product Strategies Kit Kat Technological: • An increase in capital expenditure e.g. more up to date equipment would mean that the goods where produced quicker and cheaper but would also result in job lose. • Research and development- keep developing new products to keep up with competition and customer needs. • More legislation in place to make sure that the workplace is safe and the worker is better protected. Expensive costs KIT KAT to implement.

External Analysis: The Macro environment

Social Environment

Global Environment Global expansion becoming easier

More health conscious consumers, childhood obesity

Required to retain market share

Consumer demands for more upscale products

Macroeconomic Environment U.S. economy facing downturn Less consumer discretionary income

External Analysis: 5 Forces of Analysis 11

Developing and Implementing Product Strategies Kit Kat

Intensity of Rivalry Moderately Unfavorable

INDUSTRY STAGE

Power of Buyers Moderately Unfavorable

Power of Suppliers Depends On Supplier

Threat of Entry Moderately Favorable

Pressure from Substitutes Moderate Assumption: Assumptions basically mean estimated values. In marketing plan assumption consists of following factors: Inflation Rate: Inflation rate effects very on achieving company’s desired rate for example Kit Kat set to achieve 15-20% profit on its products but due to inflation people couldn’t able to buy much chocolate rather than their necessities, so Kit Kat selling would be affected and can’t achieve its desired profit. Political Parties: It is another factor which effects on achieving organizational goals in a way that a company sign a contract with a political party or leader but during the contract era, the party or leader changed and new party don’t sign that contract than company would face problem in achieving its desired goal or may be run in lose. But if yours assumptions remain same e-g. Inflation rate doesn’t change and political parties accept your proposal than it would be beneficial for you, and you would easily achieve your desired goals.

Marketing Objectives and Strategies:

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Developing and Implementing Product Strategies Kit Kat Marketing Objectives are the goals that a business is trying to achieve through its marketing. I have set following marketing objectives • To develop a range of product: Developing a range of product or improving the new product helps the organization to maintain their position in market. Still new tastes and flavors are coming up in the market in order to maintain and improve the Company’s image. • To achieve or maintain market share: I have tried to achieve more market share and to maintain existing market share, new product development is essential for every business. • To target a new audience: Every time the organization develops a product, it targets the product to certain audiences. So i would launch a new chocolate ball to suit the needs of young children my new target audience will be youngsters’ between 12 years to 24 years age group. • To increase profitability, sales and revenue: Developing or improving of product increases the probability of fetching more profit and revenue, buy increasing the sales. So i have launched my product at lowest price and as the sale increases the price can be increased gradually.

Strategy: • • • • • • • • • • • •

Focusing on the confectionery business Reduce workforce and increase operating margin Obesity concern Health and wellness as a key to future growth Brand identity challenges Reinvest in advertising at levels in line with competitors. Kit Kat bar had to re-establish itself top-of-mind to regain market share. The primary objective for Kit Kat ball is to maintain its position as the number one selling confectionery brand. In order to achieve this, i have developed a marketing strategy that will take into account all the elements of the marketing mix. My strategy is flexible and relevant to each new generation of consumers. Kit Kat has a particularly broad consumer profile and is popular with all age groups. The Kit Kat ball marketing strategy can be summarized by the line 'Broad in appeal, young in feel and big in stature. My strategy is based on the Five Principles that shape my product: Quality, Responsibility, Mutuality, Freedom, and Efficiency.

Characteristic of product: 13

Developing and Implementing Product Strategies Kit Kat

Product: The ball would be much thicker compared to the traditional Kit Kat bars out there. The ball itself weighs 43 grams. This provides the chocolate buyer with a much lighter product experience. The chocolate ball is more solid; the texture is much better layered and structured by having different flavors inside the ball. Crisp wafer balls with a hazelnut creamy topping (18%, (Sugar, Cocoa Butter, Cocoa mass, whey powder, butte roll, emulsifier, Flavoring ,Maltitol, Hazelnuts, Milk proteins, Soy Flour, Soy Lecithin. The ingredients will be original and effective. Appearance: This Kit Kat chocolate ball is Attractive, slightly crispy, and tasty. Packaging: The style of my product is attractive enough to grab the customer’s attention. There should be enough details provided as it is a healthy chocolate so risks precautions should be there. While launching product i have kept three main things in mind: • The good quality reputation that Kit Kat balls has needed to be kept. • Only two things judge the product and quality the appearance of the product and the taste of the product over all. • The amount of products that kit Kat sell is very high, this needs to be maintained. The packaging color scheme is similar to previous kit Kat versions though this is much narrower in design. Product Design: The design is the most important factor in terms of attracting the customers. The design of my product includes the design of the chocolate which is in form of ball, the material, the logo and the slogan. The colors also matters because they bring out happiness on face so i have used the color red. The chocolate taste also is not so greasy, and does not have a sickly feel to it. It has 19% low calories, which would be the key for success of my new product. It has a nice wafer texture that supports the soft filling. Product pricing The price should be set at a medium stag so i have not used unfair pricing because it will not help the product to do well. I have also considered the competitors pricing techniques. To outcast them by setting a low price. I have decided to keep a low price at the beginning to attract more demand for the Customers.

Market segmentation: Market segmentation is the practice of dividing a market into identifiable groups of customers with common characteristics and motivation. So i have treated each group independently, tailoring the market mix to meet the needs of each segment. Furthermore, opportunities for new products and any niche markets are highlighted .

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Developing and Implementing Product Strategies Kit Kat In the past i have segments the different variety in Kit Kat; i have introduced the wafers, fruit flavor, and coconut flavor now i have launched Kit Kat ball which is pure chocolate with wafers. Now i have segment my product according to the taste of customer because after doing surveys i have noticed that most of customers want a pure chocolate with original taste. My aim to match groups of purchasers with the same set of needs and buyer behavior.

Target market: Kit Kat chocolates are very popular and people do eat chocolates very much, this will be a positive factor for us to launch new kit Kat ball a healthy chocolate that will be eaten more. This chocolate is aimed especially at young children; the purpose of my product is to fulfill a broad range of needs. My confectionery offers energy, taste, rewards and gift opportunities. Basically i have target the children and now i also want to target the teenagers because teens between the ages of 15-19 consume more candy than any other age group, targeting the teenage market has challenged to produce more products and reposition classic items. Teens eat more chocolates per capita than any other group. They are looking for a “big eat,” and are willing to pay a higher unit price along the way.

Product Positioning: As the above survey shows that 75% people are willing to purchase or test my new innovation or product that’s why i position my product in my mind is: There are two types of product positioning, 1. In customer’s mind. 2. In company’s mind

● ● ● Cadbury

Kit Kat

Mars

Chocolate

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Developing and Implementing Product Strategies Kit Kat

● ●

Kit Kat Wafers

●

Kit Kat Caramel

● Kit Kat chocolate Balls

● Kit Kat Orange

Kit Kat simple

The above graph is assumption that after launching that my new product “Kit Kat Chocolate Balls” is lie in middle point.

Marketing Mix Strategy: Marketing mix includes: 1. Identifying potential markets and market segments. 2. Different ways of entering those markets. 3. Supply chain considerations. After making these decisions the next step of marketing mix is the 4P’s The 4 P’s of the marketing mix: • Product • Price • Place (or distribution) • Promotion. 1. Product characteristics: Inherent features of the product are as follows: • Packaging and labeling characteristics o Protects the product o Communicates information o Promotes the product • Competitive considerations o Degree of competition in target market o Develop gaps in competitors’ product lines o Deciding on the right individual product for a market is only one part of the story 16

Developing and Implementing Product Strategies Kit Kat o Need to decide what family of products should be offered o Starting out with a limited product line in a market provides a way to test the market before expanding • Size of the product I introduce my new Kit Kat chocolate balls with different flavor of fruits, coconut, and almond in three sizes. o Small o Medium o Large.

2. Price: • Pricing situations • Export pricing • Local pricing. • Pricing strategies • Cost-based strategies • Demand-based strategies • Kit Kat chocolate balls prices • Small size of 10Rs. • Medium size of 25Rs. • Large size of 50Rs. 3. Place: Distribution choices are the least flexible choices in the marketing mix • Challenges • Lack of familiarity with distribution channels 11C’s of Marketing Mix: • Customers • Culture • Coverage • Control • Continuity • Communication • Competition • Company

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Developing and Implementing Product Strategies Kit Kat • • •

Character Capital Cost

Promotion: • Promotion mix includes Advertising Personal selling Publicity Sales promotions • Mix will depend on Target audience Company objectives Product or service being marketed Resmyces available • Advertising Media strategy Media regulations vary by country • Promotional message Ads should be consistent with positioning Rational versus emotional appeals Be very sensitive to cultural considerations • Sales Promotions Covers all promotions except for advertising, personal selling, and publicity includes: • Coupons • Free samples • Consumer education • Product demonstrations • Point-of-purchase materials • Discounts • Direct mail • Prizes and giveaways

Measurement Review and Control: Kit Kat’s estimated budget was 5 million, from which i have spent 2.5 million on raw material, 1.6 on the advertisement campaign; moreover 1 million was spent on the wages, salaries, transportation and electric cost etc. And the final cost of the project was 5.1 million, just 1 lac exceeding from the estimated budget. Now i have to adopt such measures through which i become able to get back this entire amount plus at least 15% more amount.

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Developing and Implementing Product Strategies Kit Kat Kit Kat can control this project to get more and more profit through making attractive advertisement, especially make such type of advertisement which attract children and youngster more because Kit Kat chocolates balls targeted first children and than youngster. And also provide such promotional incentives which would be beneficial for children as well as their parents.

Questionnaire Analysis: From survey i come to know Nestle Kit Kat chocolate’s position in market is shown in this figure:

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Developing and Implementing Product Strategies Kit Kat 45 40 35 30 25 20 15 10 5 0

Dairy Milk Kit Kat Mars

This bar chart shows selling of Kit Kat in the market. Nestle Kit Kat chocolates wants to bring an innovation in existing product which is Kit Kat chocolate balls with fruit, coconut and almond flavor. Before launching my product i conduct a survey that my customer would like this change or they are not ready to purchase Kit Kat chocolate balls rather than Kit Kat chocolate bar, survey result is shown graphically as below 80 70 60 50

Yes

40

No

30

Neutral

20 10 0

I conduct a survey of 25 samples, out of this 75% people are willing to adopt this change, 19% says they are happy with existing product they don’t want any change in Kit Kat bar chocolate and 6% are neutral.

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