Redesigned marketing strategy for Nutella; Product concept of chocolate, Hazelnut, palm oil and sugar. Nutella, the $3.9 billion nut-based and sweet spread category grew 34% from 2008-2013. While its popularity grew steadily, the product really took off after the company employed three smart branding strategies 1)
It focused on the breakfast market 2) the company never explicitly claimed the hazelnut spread was healthy in and of itself, it did cleverly brand the spread to be associated with a balanced diet 3) It capitalized on consumers’ curiosity to experiment with using it on other items and sharing it on social media. Boycott Nutella!!
In May 2017, the European Food Standards Authority warned that a contaminant found in the palm oil’s edible form is carcinogenic. It warned that even moderate consumption of the substance represented a risk to children and said no level could be considered safe (The Independent, 2017). Palm oil is found in hundreds of household name food brands including Cadbury’s chocolate, Ben & Jerry ice-cream, but Nutella has so far faced the brunt of a consumer backlash. Thus, associating the brand with concerns linked to environmental damage provoked by palm oil production and negative effects on health due to high sugar content from its consumption (Cova and D’Antone, 2016). Sugar content in a standard 400g pot of Nutella equates to nearly 56% of the whole Nutella jar raising health concerns for parents who incorporate the spread into their children’s diets. Several retailers have boycotted the spread as a precaution. In response, Ferrero has launched an advertising campaign in an attempt to reassure customers that its products are safe. Ferrero insists that the decision to keep sugar and palm oil in Nutella, despite safety fears, is about quality, not cost. The substance is used to give the spread its smooth texture which it says can’t be achieved by using other substitutes, such as sunflower oil or flaxseed oils. Making Nutella
without palm oil would produce an inferior substitute for the real product, it would be a step backward. Ferrero uses about 185,000 tons of palm oil a year, so replacing it with those substitutes could cost the firm an extra $8-$22 million annually. The European Food Safety Authority said that palm oil generated more of a potentially carcinogenic contaminant than other vegetable oils, but it did not recommend consumers stop eating it (Sydney Morning Herald, 2017).
Cova and D’Antone. (2016). Brand Iconicity vs. Anti-Consumption Well-Being Concerns:
The Nutella Palm Oil Conflict. The Journal of Consumer Affairs, Vol 50 (1),166-192.
Nutella maker fights back against public(tm)s fears over cancer-causing palm oil. (2017,
2017/01/12/). Brief article. The Independent (London, England), p. 55. Retrieved from
Nutella defends its use of palm oil. (2017, 2017/01/14/). Brief article. The Sydney
Morning Herald (Sydney, Australia), p. 16. Retrieved from
Image source: MrFlow/Reddit
The scope of your assessment has been narrowed down in order to ensure continuity in
thinking throughout the marketing report. The scope of your assessment, in which
students must adhere to, is outlined as follows:
Redesigned marketing strategy for Nutella should be within the boundaries of nutbased
spreads and sweet spread product category.
Marketing strategy should be for Nutella Hazelnut spread only!
Product concept of chocolate, Hazelnut, palm oil and sugar should be retained.
Report based on Australian context.
Use the structure provided as sub-headings in the report.
Presentation style: Marketing report. Adhere to the structure provided on the
To score highly, students must attempt to fulfil 70% of the assessment criteria
Length: The total length of the assignment is a maximum of 3,000 words.
Penalty applies for exceeding word count limits (see Tutorial Week
7 ppt). Appendices may be attached as necessary (appendices are
exclusive of the word limit).
Weighting: 25% of your total mark.
Group Project: 2-4 members; you must form a group with students that are
enrolled in the same tutorial class as yourself; you may only
form groups with students from alternative tutorials provided
you have the same tutor.
Workshop A practice workshop will be held in tutorial week 7.
Workshop slides will be available in LMS after the tutorial.
Due Date: Wednesday 3rd October 2018 by 4pm (Week 10 Submission)
Submission Process: Online via the LMS. Hard copies are NOT required.
You must consult & reference a minimum of 4 academic sources, of which one can
be the prescribed textbook Armstrong et al. (2018).
Section Assessment Criteria
The purpose of the executive summary is to summaries the marketing plan and
provide readers with a synopsis of the analysis along with the limitations and
conclusion to the report.
An executive summary should be half page in length and usually
written only once the marketing report is finalized.
The purpose of the introduction is to establish:
Purpose, context and scope of the report and should answer the
question― why is this report relevant?
Avoid nuance. Be as direct as possible this will set the tone of the
report. If the market research shows the company is dominating, say
so. If the market research shows the company is falling behind
competition, admit it.
Talk statistics to explain your point or identify a research issue
Keep it brief. If you’ve gone longer than a three- or four-paragraph
introduction, start editing. The intro’s job is to lead readers into the rest
of the report, not repeat everything they are about to read.
Following the introduction this section should provide an in-depth analysis of
the current marketing strategy used by Nutella and industry trends in nut-based
spreads and sweet spread product category.
If possible, use statistics to support your statement.
This section should be brief and identify a specific area of concern, a condition
to be improved upon, a difficulty to be eliminated or a troubling question for
Nutella using marketing theory/concepts.
Problem exploration should be against current marketing strategy used by
Nutella and industry trends in nut-based spreads and sweet spread
Visualise the problem areas beyond the background brief provided
(10%) This section should include the buyers profile and buyers’ behaviour for your
target audience and look at issues around (but not be limited to)
What are the traditional market segments within the nut-based spreads
and sweet spread product category?
What recent consumer trends are shaping those market segments?
What market segment is your redesigned product targeting? Describe the
target customer(s) Identify your target audiences/ segment’s key value
In-depth analysis of the buyer in the customer profiles― buying roles,
buying behaviour and buyer decision making process.
In this section, use 4Ps of marketing to redesign a marketing strategy for
Nutella to strengthen its brand image.
Construct a “conceptual map” (see workshop ppt for conceptual
map examples) to report all your observations that inspired your
new marketing strategy
Consider the timeline for your strategy (e.g. either launch/shortterm
and long term plans).
Discuss the impact of your redesigned strategy on Nutella product.
Discuss the impact of your redesigned strategy on its pricing.
Discuss the impact of your redesigned strategy on distribution
Review the impact of the redesigned strategy on promotional tools
Evaluate the commercial value of your redesigned concept against the
commercial value of original Nutella spread.
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