Product Description

This report focuses on the market analysis and marketing mix for KIT KAT SENSES – an innovative product from NESTLE. This marketing mix and market analysis of KIT Kat Senses would assist in evaluating the possibility of the products sells and how well it will do in market.

In 2018, Nestlé has come up with a new product under the brand name Kitkat, especially made for sharing with friends and family and loved ones. “KITKAT SENSES” The new product from the brand has a different look in comparison to the earlier finger shape, these are now individually wrapped and bite size three layered filled with flavors for three different taste pallets.  It is famous for its Breaking an image of wafer finger chocolate.

It has now come up as three flavors removing the tag of chocolate bar, and is also available mix sharing box with all the three flavors, these flavors are, The Hazelnut Praline, the Salted Caramel and Double Choc (Chantelle, 2018).

The second largest market in Europe for confectionery and chocolates after Germany is the U.K. Chocolate and confectionery market, it is estimated that an average consumption of the UK chocolate market is between 4 KG to 10 KG per head. Since 2003, not only in consumption, but the confectionery sale is also the highest.  The chocolate market has an increasing trend showing an annual growth rate reaching £4.83bn.

According to Mintel (2013) Britain is not partial when it comes to chocolate consumption and buying pattern, alone in 2012, 94% consumers bought chocolates and 95% ate the same. The buying behavioral pattern suggests that the filled bar chocolates and block chocolates were amongst the major players.

Source: https://www.statista.com/chart/5940/top-five-uk-confectionery-manufacturers

It has been seen, that in U.K. market sharing bags and small bite chocolates have more sales than others, and offering on the bite to bite basis would be more preferred. In 2016-2017 more sharing products came up with just a bite size chocolate, a newer chocolate version to candies and toffee, it also became a success.

Market trends

Such as Mars came up with snicker bites, known as mars bites, Twix another chocolate came up as Twix bites, Cadbury Launched its Dinky Deckers and Nestle apart from Nestle Senses earlier came up with Nestle Bites, which was also a success and was in line with the trend Mintel (2018). However, the consumers are moving towards healthier choices, therefore, they are moving to opt for healthy and energy bars, in this market, launching bite size chocolate will give them a feel of chocolate to satisfy their sweet tooth with a small calorie intake. It will be easier to avoid eating a whole bar of chocolate having more than double calories (Mohd, Idris, and Momani, 2013).

The future market growth and consumer pattern will depend on the changing pattern of consumer buying behavior and how the chocolates are prepared, their impact on the environment and health. Due to this lobby being created by health conscious consumers and healthy eating community the chocolate and confectionery market is struggling to stay with innovation and opportunity to survive by reducing the calorie count, reducing the size and making filling with nuts and nutrition. Therefore the Organic Chocolate Market is coming as a recent trend which is again an issue for a non-organic chocolate brand (Rashid, and Ghose, 2015).

Segmentation: The entire market can be divided on the basis of Psychographic, geographic and behavioral segmentation.

Psychographic Segmentation: Kitkat Senses is segmented on the basis of size, the product will enter in the market with small bite size chocolate in order to maintain the calorie count along with satisfying the sweet craving.

Geographic Segmentation: The product is made and distributed in the UK market looking at the number of consumers and booming confectionery markets. Initially the product will however be launched in Tesco (Rashid, and Ghose, 2015).

Behavioral Segmentation: It has a tag line which the company is using nationwide, “Make the most of your break”, this time the positioning is to have a break with friends and family with the assortment pack of 20 bite size KitKat.

The target market is aimed at people living in U.K. The test market will be Tesco and further moving to the U.K. and entire nation and other countries. Target customers will be above 10 years of age and till approximately 50. Children below the age of 10 must be eating more healthy treats and fruits, similarly, people above 50. For people above the age of 50 suffer from diabetes and heart diseases, therefore would require less sweetened choices (Fernandes, Ferreira, and Moura, 2016).

Key competitors and their positioning strategy?

The college and school students and working class people will be targeted; therefore the pricing will be kept according to the market avoiding the pricing to go too high.

Source: https://www.statista.com/chart/5940/top-five-uk-confectionery-manufacturers/

“KitKat Senses” is launched as a premium confectionery product in the U.K. market, providing people the same product in a new packaging, removing the old concept of the finger chocolate bar.

As it can be seen from the data above, the market for chocolate sharing bags and chocolate Multipacks is small and has a scope to be explored further and tap the non users. Therefore, the product is launched in the form of sharing bags, However, the Chocolate block market is large but, KitKat original with finger sticks is already tapping the stated block market.

Therefore, the positioning will be done on the basis of

1. For sharing with friends and loved ones
2. Launched in the market during the holiday season to give the consumers a reason to buy and increase the use of a new and innovative product by the same old established brand in a new flavor.
3. The box makes it a perfect gift, on special occasions to fight against the Cadbury gift products (Foodprocessing, 2018).
4. Small munching items post dinner

1. The small size will provide the satisfaction in low calorie
2. The assortment pack of 20 in a box will be a great gift for the loved ones
3. The new kitkat senses is introduced to share it while enjoying the most special moments (Schmidt, Spann, and Zeithammer, 2014).
4. The price is also affordable being in a premium segment, 3.99 Euro per 100g.

Kitkat senses have dropped all the expectations and tried moving beyond the expectations by making changes in the older version. The product now will be available in three different variants away the original chocolate wafer flavor. The product will new packaging altogether from bars to box packaging, which will open in an easy and convenient sharing plate. The consumers will find a different taste and look from their favorite finger shape chocolate wafer brand, however, the tag line remains the same as make the most your break, but this time, it must add along with your friends. A chocolate wafer has now turned into a snack.

There will be 20 small bite size chocolates in a box for £3.99 starting from Tesco to move nationwide (IMOGEN, 2018).

Out of multiple pricing strategies in the market, the company will use the following strategies.

1. Competitive pricing
2. Market oriented pricing
3. Psychological pricing

A combination of strategies will work best for the brand,

The Competitive based marketing strategy will be used, keeping the current kitkat pricing in mind, Market oriented pricing will have to be followed as well, because this is a new and innovative product to break an old image, the switching cost is low therefore, a high price could be a danger. Adding psychological pricing on the above strategies can be advantageous, as it has been seen that psychology pricing affects consumer buying behavior (Siguaw, and Simpson, 2015). 

The chocolate industry is considered to be highly seasonal despite its sales throughout the year, but the boost in sales comes during the holiday season during December and January. Therefore, most of the promotional activities will be before Easter and Christmas Eve to seek a sharp increase in sales.

1. The promotional tools will include
2. The advertisements during prime time
3. The company has been using the celebrities for promotions, the same will be continued.
4. The social media tools such as direct purchase from Instagram and Facebook will be made available.

The sales of confectionery product is highly dependent on the availability and stock in the market, therefore, the product will be available in all the retail stores, and other distribution channels such as online selling platforms to promote impulse purchase.

Conclusion: 

After assessing all the details and the marketing mix of the newly introduced Kit Kat product, it could be inferred that company by following the customized products and product differentiation strategy could easily win over the market. This will help company grab more market share and increase the attraction of its newly offered chocolate in the market.

References: 

Chantelle. S., (2018). Nestlé launch Kit Kat Senses sharing chocolate box and you can buy them from these major supermarkets [Online]. Retrieved from https://www.mirror.co.uk/money/shopping-deals/nestle-launch-kit-kat-senses-12075410 

Fernandes, C., Ferreira, M. and Moura, F., (2016). PPPs—True Financial Costs and Hidden Returns. Transport Reviews, 36(2), pp.207-227.

Foodprocessing., (2018). Nestlé launches KitKat Senses box in UK and Ireland [Online]. Retrieved from https://www.foodprocessing-technology.com/news/nestle-launches-kitkat-senses-box-uk-ireland/ 

Imogen. B., (2018). KitKats go posh! Nestlé is to launch a new luxury version of the famous wafer treat (and it looks like a deluxe Chunky bar) [Online]. Retrieved from https://www.dailymail.co.uk/femail/food/article-5426393/Nestl-launches-posh-luxury-KitKat-Senses-bars.html 

Martin. A. (2016). Top Five Confectionery Manufacturers [Online]. Retrieved from https://www.statista.com/chart/5940/top-five-uk-confectionery-manufacturers/

Mintel., (2018). chocolate-confectionery-uk-april-2013 [Online]. Retrieved from https://store.mintel.com/chocolate-confectionery-uk-april-2013

Mintel., (2018). Mintel Chocolate Confectionery Overview [Online]. Retrieved from https://store.mintel.com/us-chocolate-confectionery-market-report.

Mohd, W., Idris, S. and Momani, R.A., (2013). Impact of environmental dynamism on marketing strategy comprehensiveness and organizational performance. International Journal of Business and Management, 8(9), p.40.

Rashid, S. and Ghose, K., (2015). Organisational culture and the creation of brand identity: retail food branding in new markets. Marketing Intelligence & Planning, 33(1), pp.2-19.

Schmidt, K.M., Spann, M. and Zeithammer, R., (2014). Pay what you want as a marketing strategy in monopolistic and competitive markets. Management Science, 61(6), pp.1217-1236.

Siguaw, J.A. and Simpson, P.M., (2015). A marketing plan for marketing instruction: A satirical look at student comments. In Creating and Delivering Value in Marketing (pp. 129-133). Springer International Publishing.