MARKETING STRATEGY 1

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Table of Contents
Introduction ........................................................................................................................... 3
Market Situation ................................................................................................................... 3
Segmentation Criteria .................................................................................................................. 3
Geographic ................................................................................................................................................ 3
Psychographics ....................................................................................................................................... 4
Demographic ............................................................................................................................................ 4
Behavioral ................................................................................................................................................. 4
Target market ................................................................................................................................. 4
Buying Behavior Issues ................................................................................................................ 5
Competitors ..................................................................................................................................... 6
Positioning .............................................................................................................................. 7
Product ............................................................................................................................................. 7
Pricing Strategy.............................................................................................................................. 9
Price strategies of Kit Kat intermediaries .................................................................................... 9
Place ................................................................................................................................................11
Promotion and Communication ...............................................................................................12
Brand Positioning ........................................................................................................................14
Band Domain......................................................................................................................................... 14
Brand Personality ............................................................................................................................... 14
Brand Values ......................................................................................................................................... 15
Brand Reflection .................................................................................................................................. 15
Brand Assets.......................................................................................................................................... 15
Differentiation ..............................................................................................................................15
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Introduction

A famous chocolate brand Kit Kat provides a wafer bar covered with

chocolate that was previously offered by a company; Rowntree’s of York and now it

is manufactured worldwide by Nestle as it has acquired Rowntree in the year 1988.

But in USA, Kit Kat is produced by a licensee H.B Reese, a candy-manufacturing

firm, which is a subsidiary of The Hershey Company and a competitor of Nestle. The

standard product contains 2 or 4 wafer bars, covered by chocolate and also separated

by a layer of chocolate (Lee, 2016). Each wafer bar could be separated from another.

Kit Kat offers variety of flavors that includes white chocolate, milk and dark

chocolate.

Since 18th century, the term Kit Kat or Kit Cat was used for food products. At

that time mutton pies were called Kit Kat and was offered at a political club known as

Kit-Cat club in UK. Christopher Catling who was a pastry chef owned the club.

Nestle has opened the production of Kit-Kat in 16 countries of the world which

includes; Algeria, Brazil, Bulgaria, Mexico, UAE, UK, Turkey, Canada, India,

Australia, Thailand, New Zealand, Malaysia, South Africa, Japan, Germany, Russia

and China (Lee, 2016).

Market Situation

Segmentation Criteria

Geographic

Nestle has based its market segmentation for its product, Nescafe ice on the

geographical weather like cold, warm or hot. They also take into account the

information like world region, country region or countryside area (Break with Kit

Kat, 2018). Thus it could easily track any changes in the customer behavior.
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Psychographics

Nestle consider the personality traits and life styles of its customers during its

market segmentation for instance Kit Kat is for real chocolate lovers and Nescafe 3 in

1 is for those who need coffee in their hectic routines (Break with Kit Kat, 2018).

Demographic

Nestle also based its market segmentation on important demographic factors like

gender, age, earnings, literacy etc (Break with Kit Kat, 2018):

 Age: Nestle offer variety of products according to their suitability for the

customer’s age, like coffee for adults and milo for kids

 Earnings: Nestle offer its products at reasonably affordable rates to meet the

demands of customers, belongs to various income groups.

 Profession: Nestle also consider the various professions of its customers while

designing its products

Behavioral

Nestle considers the behavioral patterns like awareness, knowledge and

approach of the customers while defining its market segment’s (Break with Kit Kat,

2018).

Target market

Kit Kat’s consumer market includes most of the countries of the world. Both

genders men and women are targeted (Break with Kit Kat, 2018). The target age limit

varies with the products for example Kit Kat chunk for teenagers, Kit Kat mini for

children.

Buying situation

 Benefit sought: Mostly customer purchases Kit Kat for its good taste and

variety of flavors. In majority countries it is available in white and black

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chocolate and milk flavors. But some countries demand more flavors for

instance it offers almost 200 flavors (Break with Kit Kat, 2018). Another

feature is the various formats of Kit Kat that the consumers consider to meet

their distinct needs (Break with Kit Kat, 2018).

 Usage: In every second almost 650 Kit Kat bars are consumed in the entire

world.

 Awareness and Intention:Kit Kat maintain a very helathy realtionship with

all of its customers and thus designed some special attributes to its products to

make it cutomer favorit brand (Break with Kit Kat, 2018). It enables the

customers to share their good or bad their experience of the brand through

pictures on social media.

Buying Behavior Issues

Kit Kat can no longer attract its customer segment of kids through simply

attractive toys. Kids are now exposed to Internet that provides them with

multifunctional games and other entertainment opportunities (Break with Kit Kat,

2018). This segment is now becoming a more rigid, strong and progressive one.

In Australia, firm experience a dramatic change in children’s purchasing

patterns. Due to improved education, earnings and acceptance in society, children are

now frequently involved in almost all the decisions. Children are now involved in

working and earn money that makes them independent individuals. They are well

aware of various brands and experiment different products.

Kids, as compared to adults, observe all the things from big to small in a store.

They examine the environment, staff behavior. If they do not fell happy about all this

they may be annoyed very easily.

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When it comes to Nestle, children mostly regard it as a dairy brand. Many of

them have not realized that Nestle also offer chocolates for kids. Thus Nestle is

leading the dairy product market but not the confectionaries market.

Competitors

Two main competitors of Kit Kat are (Kabriti, 2014);

 Kinder Bueno, a sweet brand of Ferrero. It consist of two separate wafer bars

covered with chocolate. Each bars is further divided into four pre-portioned

bites. A creamy hazelnut is filled in each bar.

 Twix, a sweet brand of Mars incorporated. Its two bars are made up of crispy

biscuit covered with smooth chocolate and caramel.

Kit Kat operates in a highly competitive industry of confectionary. Firms launch

their new range of products, which are very much identical to that of their

competitors. An example of this could be the sale of similar size products by these

brands like Kit Kat mini, Twix mini and Kinder Bueno mini. In addition to this, all

these brands are targeting the similar market, offer similar price range, utilize same

points of selling provide resembling packaging with white and red color and their

timings of product launch is also very close with almost similar products (Kabriti,

2014).

But the unique point of Kit Kat is its shape, a four fingered chocolate bar, which is

sometimes considered as an alternate expression of the brand. A customer can easily

separate the chocolate bars from each other and can further divide each bar into

proportioned bites.
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Positioning

Product

Kit Kat is a tasteful fusion of wafer biscuit and chocolate. Its well-known

four-finger shape enables customers to share the product. It also enhanced the brand

awareness. Kit Kat’s target market includes large set of global customers thus it has to

fulfill a wide range of needs (Bhasin, 2018). Considering this, Kit Kat offers different

flavors and sizes to cater all the divergent needs, irrespective of any cultural

variations. Adaptation is its major strategy so its Product line expansion includes

flavors like tea, caramel and others to suit particular tastes of specific markets (Break

with Kit Kat, 2018). But to avoid cannibalization its major focus remains on their

main product and to increase its life cycle. Kit Kat has also experimented the brand

extension strategy. It shows that it wants to leverage its strong brand image rather

than risking a new product launch in an entirely new market (Break with Kit Kat,

2018).
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Product slogan: Kit Kat has established its famous slogan, Have a break, have a Kit

Kat. It is focused on two major positioning goals; sharing a Kit Kat and producing

relief for the customers in a stressful life (Bhasin, 2018).

Product Packaging: The unique white and red colors of Kit Kat packaging makes the

brand more distinguishable and thus constitute an important brand attribute. Red
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depicts passion and power while white indicates purity and cleanliness. Only during

WWII, Kit Kat had changed its traditional packaging color (Break with Kit Kat,

2018). Its packaging includes the Nestle’s logo to aware the customers about the high

quality of the product and also to create coherence among all the brand of Nestle

portfolio.

Major product elements: A wafer covered with chocolate and available in many

finger sizes. Furthermore, its original flavor and flavors offered for particular time

period like Kit Kat mint. Packaging is also another major element (Bandalkul, n.d.).

Finally different shapes of the Kit Kat like ball, mini etc.

Pricing Strategy

Over some last years, Kit Kat has maintained its price stability regardless of

the variations in the cocoa market, all because of the power of Nestle cocoa plan. But

Kit Kat snacks can vary in terms of its prices based on the place of selling or the

product itself (size, quantity and flavor) (Break with Kit Kat, 2018).

Price strategies of Kit Kat intermediaries

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Independent gas Special retailers Discount outlets Hypermarkets and

stations and like cinemas, supermarkets

convenience stores airports etc.

Normally purchase Schools and They mostly sold a Usually purchase

less quantities and offices etc. offer regular flavor of an large quantities of

thus sale on higher their own prices old product, with Kit Kat with other

prices to get their but with less old packaging. products of Nestle.

profit margins. margins. Cinemas They can purchase It enables them to

and airports have the products on sell each chocolate

their particulate lesser price as of Kit Kat at lower

price policy for compared to other price and thus can

selling snacks with big retailers and conduct more sales

high profit thus sold to promotions

margins. consumers on less

prices.

In mostly cases Kit kat mantains a strong control over its prices. Some

products are exclusively sold to specific stores (small quanity to small outlets). Prices

also vary among the countries where the products are sold. Kit Kat also offers

discounts on multi pack product purchase from supermarkets. Gas stations offer

quantity discounts like bye 2 get 1 free (Break with Kit Kat, 2018). Retailers offer

seasonal discounts on events like charismas to boost the sales.

Kit Kat follows the competitive pricing strategy by offering same price for its

regular bar as the other chocolate bars. But price is not a competitive advantage of Kit
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Kat so it has to rely on active communication, sales promotions and good availability

to attract more customers. In order to gain impulsive purchasing, Kit Kat tends to

emphasize on the small outlets.

Place

Kit Kat faced a highly competitive industry with many alternate products. It

makes the product placement very important as if the customer will not get Kit Kat in

one store; he is more likely to buy another product rather than searching for it in other

stores. Kit Kat follows intensive distribution strategy to make the product available

anytime and anywhere to its customers that indicates online sale and sales through its

own outlets (Break with Kit Kat, 2018). Furthermore, strong distributions network of

Nestle including supply chain, warehouses etc. has also been utilized by Kit Kat.

Kit Kat is available in more than 70 states of the world. As it is an impulsive

product so to attract more customers, many intermediaries use strategic placement

strategy by displaying the product near the cash counters (Bhasin, 2018). But the

approval of two companies is essential for this, which are Nestle and Carrefour in this

case, with both having strong power of negotiation (Break with Kit Kat, 2018). Kit

Kat relies on pull strategy to increase its distribution.

By following these strategies Kit Kat became able to effectively cover its

entire target market. Whenever and wherever its customers want a Ki Kat, they are

able to get it quite easily. Large amount (bulk) of Kit Kat and other products of Nestle

are purchased by some of the hypermarket and supermarket firms like Carrefour

(Break with Kit Kat, 2018). These stores than distribute these products in their stores,

spread in the entire country. Contrary to this the small stores owners rely on

wholesale channels.
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Nestle has utilized both wholesale channels like (Nestle distribution Centre

and Metro in Europe) and retail channels in addition to the special channels like

online sales to maximize the market coverage of Kit Kat and also to increase the

availability of product (Bhasin, 2018). Through all these efforts Kit Kat’s availability

is assured in counties like France and some other countries of the world.

Promotion and Communication

Their advertising strategy based on TV, outdoors media like bus stops,

billboards etc., sales promotion, street marketing and social media. Currently the firm

utilizes various advertisement programs simultaneously in different parts of the world

according to distinct cultural needs of different markets (Break with Kit Kat, 2018).

Their majority advertisements revolve around the idea of having a break.

Online Promotions: Kit Kat is very effective in its online promotions. It relies on

online marketing to promote its contests, new products, events and campaigns. It

utilizes Twitter, Facebook and its website to create awareness about the existing and

upcoming products (Bhasin, 2018). Customers are able to share their experiences and

what they need in the product. It provides online innovative recipes to use the

product.

Sales promotion: Sales promotions are mostly in the form of special discounts like,

buy 1 get 1 free, or contests like cash and travel prizes. Its sales promotion strategies
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are well advertised on Facebook. It has been observed that it does not use its heritage

rather fun and humor as its major advertiement element. In addition to this, the firm

also promoto its product inside its selling stores through designing entertaining events

for the customers where free samples are given to increase awareness and sale.

Public Relations: Kit Kat and Nestle relies on public relations to enhance the

consumer perception and brand equity of the firm. For example they promote the idea,

how their cocoa plan makes the lives of poor farmers much better in under developed

countries, in the press and on their website (Break with Kit Kat, 2018). They also

make partnership with fair trade and create a positive image in the minds of

customers.

Sponsorship and Partnership: Kit Kat also provides sponsorship to events like

football world cup. It made partnerships with some special cultural events like

movies. It also made partnership with Android to get more global visibility and

association with one of the world’s strongest brand.

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Brand Positioning

Band Domain

The targeted audience of regular Kit Kat bar includes both men and women of

age 15-40 in the entire world. While its core target is youth of age 18-24 years. In

terms of market place, the brand operates in a competitive confectionary industry.

Brand Personality
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The Aaker’s brand personality framework defines the personality of Kit Kat as

cheerful, spirited, daring and with a very good sense of humor. As the major aim of

the brand is to give its consumers a relief break from their stressful routines so it

portrays its brand as an empathetic, dynamic and full of fun thus its customers get the

feeling of complicity and gratitude to the Kit Kat (Break with Kit Kat, 2018).

Brand Values

The brand value is well expressed in its slogan. The concept of break became

a universal and timeless identity for the brand. Idea of fun also describe the firm as it

never adopt serious advertising campaigns and maintains a quirky energy which well

suits the idea of break. Brand originality is another important brand value.

Brand Reflection

Customers could have variety of feelings after getting a Kit Kat. They may

feel cool, fun, sharing etc. as the brand is communicated these feelings as its core

values. Due to its break concept the may feel relieved and satisfied. It also gives a

youthful feeling due to its dynamic and positive character (Break with Kit Kat, 2018).

Brand Assets

Kit Kat differentiate its brand from the competitors in variety of ways which

includes a unique and attractive packaging, its four chocolate bars shape and its idea

of having a break. Provision of variety of flavors, formats and packaging defines the

brand as a creative one.

Differentiation

1. Wafer stick

Offering Kit Kat as a wafer stick is a unique and distinguishing feature of the

brand. Although one of its competitors, M&M’s, also offers a type of chocolate with

wafer biscuit but being a chocolate wafer stick is something identically associated
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with Kit Kat. It’s another competitor Ferrero Rocher has almond filled chocolate

center as its main point of difference. Ferrero Rocher has also introduced a new dark

chocolate flavor with chocolate filled center.

2. Different sizes

Provision of its products in variety of sizes is another POD for Kit Kat in

comparison to its competitors M&M’s and Ferrero Rocher. Its size range includes;

single stick, four stick and double stick versions and chunky. While its competitor

M&M’s provides a mini and normal size and Ferrero Rocher provides a standard

fixed size for all its chocolate categories.

3. Related to snacks

Kit Kat is mostly considered as snack contrary to its competitors M&M’s and

Ferrero Rocher that are mainly considered as chocolate brand or a sweet. The reason

that Kit Kat is associated with snack is the fact that it promoted itself through a

famous slogan Have a Break, Have a Kit Kat. Kit Kat pricing is considered more

reasonable than the Ferrero Rocher that positioned itself as an exclusive brand.
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References

Bandalkul, A. (n.d.). Brand positioning. Retrieved from

http://breakwithkitkat.weebly.com/brand-positioning.html

Bhasin, H. (2018). Marketing mix of Kitkat by Nestle – Kitkat Marketing mix.

Retrieved from https://www.marketing91.com/marketing-mix-kitkat/

Break with Kit Kat. (2018). Brand Positioning. Retrieved from

http://breakwithkitkat.weebly.com/brand-positioning.html

Break with Kit Kat. (2018). Break 1: Brand Identity. Retrieved from

http://breakwithkitkat.weebly.com/break-1.html

Break with Kit Kat. (2018). Break 5 - Formulating Future Growth Strategies for your

Brand. Retrieved from http://breakwithkitkat.weebly.com/break-5.html

Break with Kit Kat. (2018). Global Business Strategy. Retrieved from

http://breakwithkitkat.weebly.com/global-business-strategy.html

Break with Kit Kat. (2018). Stage 1 - Segmentation. Retrieved from

http://breakwithkitkat.weebly.com/stage-1---segmentation.html

Break with Kit Kat. (2018). Stage 4 - Brand Strength. Retrieved from

http://breakwithkitkat.weebly.com/stage-4---brand-strength.html

Break with Kit Kat. (2018). The Brand Purpose. Retrieved from

http://breakwithkitkat.weebly.com/new-brand-purpose.html

Charlène, T. (n.d). Strategic International Marketing Review Kit Kat. Retrieved from

http://www.academia.edu/10141703/Strategic_International_Marketing_Revie

w_Kit_Kat

Jaffe, E. D. (1980). Are Domestic and International Marketing Dissimilar? An

Assessment. Management International Review, 83-86.

Kabriti, K. (2014). Kitkat marketing strategy. Retrieved from

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https://www.slideshare.net/kkabriti/kitkat-marketing-strategie

Lee, A. (2016). How Kit Kat Became One Of The World’s Favorite Snacks.

Retrieved from https://www.referralcandy.com/blog/kit-kat-marketing-

strategy/

Roderick, L. (2015). Kit Kat talks up ‘moment marketing’ drive as it celebrates

growing sales. Retrieved from

https://www.marketingweek.com/2015/12/02/kit-kat-talks-up-moment-

marketing-drive-as-it-celebrates-growing-sales/