Ferrero Rocher Case Study

1 January 2017

Ferrero Rocher is an Italian based confectionary company known for its high quality and uniqueness. The history of the company dates back to 1946 in Alba, Italy where Pietro Ferrero created a confectionary out of 50% hazelnut and 50% cacao beans. The ferrero chocolates were an instant hit in the market and the creamy spread Nutella introduced by Pietro’s son Michele took the company to great new heights.

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Even decades after the company was founded the company structure is still based on solid family values. Ferrero Rocher currently holds 7. 3 percent of the global market share (Businessweek, 2010) and 13. 2 percent of Western Europe’s share. Today the company has more than thirty business units, fifteen production plants and three social enterprises the Ferrero Rocher’s consolidated turnover is 7218 million euro, a 9. 1% increase than the previous year (Ferrero, 2010).

Ferrero is best known for its high and consistent quality over the decades focusing on consumers and their strategic understanding of global consumer needs enables their company to rapidly foray into global markets making Ferrero Rocher chocolates globally favourite. Ferrero also ensures that they keep a secure retail supply chain thus ensuring a good relationship with their marketing intermediaries as well. Ferrero Australia was started in 1974 to delight the Australian consumers with the unique experience of high quality chocolates and it has been a growing market ever since.

Ferrero currently employs over 300 people for their operations in Australia. The company does extensive testing of their products in Australia before the actual release showing how careful they are about retaining the high brand image they have attained. Today even with major competitors like Cadburys and Hershey’s, Ferrero still retains its brand image as one of the premium and unique confectionary available over the counter. Answer 1:- Evaluation of Ferrero’s online boutique in Australia and its impacts.

Ferrero Australia’s Online Boutique is one of the newest additions to the Ferrero Family. Started in 2010 the online boutique sells premium gift boxes and corporate gifts containing ferrero products. The online boutique was started as a result of continuous request from customers in Australia particularly during the holiday season for chocolate gift boxes. With the price ranging from $45 to $360 for premium and special occasion gifting purposes, the online boutique also has an option for corporate gifting.

Ferrero’s online boutique is a unique strategy which opens a distribution channel that directly connects the consumers to the company and hence creates a personalised relationship with the consumers providing the consumers with a refreshing shopping experience. The online store also provides easier accessibility to consumers nationwide against the conventional shopping hence reaching a wider audience. This not only improves the sales but also creates a great brand awareness of the product.

It is this easier accessibility that will encourage people all over Australia to use the online boutique especially during the festival seasons. The online Boutique in Australia offers a premium chocolate collection which is targeted at the upper middle class and the High class as they have the essential buying power and hence will take full opportunity of utilising the online boutique services. It also provides a refreshing experience by providing personalised packaging options like keepsake boxes and themed covers and special cards for writing to your loved ones that makes them feel special.

The assortments available in the online boutique is not available in the retail outlets, this creates a special feeling among consumers who use online boutique as they have been offered something unique and exclusive. Since the target market is narrow Ferrero concentrates on constant enhancement of the services provided which creates a great value for the consumer and hence they become loyal to the brand. Thus, by providing a personalised relationship ferrero increases its brand loyalty among its consumers. Also the time taken is very less as compared to conventional shopping hence this serves as a boon to those who are time crunched.

In today’s fast moving world the online boutique offers a great platform for a time saving shopping experience yet the gift received is something wonderful. Bulk and corporate gifting also becomes much simpler as shopping can be done within minutes. Looking at the marketing environment pertaining to Ferrero’s Online Boutique Microenvironment is the factors that directly influence/get influenced by the company forming the inner circle of the company. Taking a look at some of the Microenvironment factors, 1. Strong Company background 2. Reliable and secure supply chain 3.

The Internet usage in particular is used by over 74% of the opulation starting from age 15 and over 64% of online users use it for online shopping purposes. [pic] Internet Usage in Australia Source: (Australian Statistics, 2010) The above factors show that there is a very good marketing environment for online boutique in Australia. Impacts on other Business Segments: Online boutique offers only a range of premium chocolates and for gifting purposes which is more personalised and it caters to a narrow market, also the products available in online boutique is not available in retail stores and vice versa and thereofore this will not essentially affect the sales of the other products.

Also opening an online boutique will create more brand awareness and since it reaches a wider audience this increases the brand image of Ferrero and this will actually help increase the sales of other products offered by Ferrero Rocher. The existing distribution channel also gets enhanced as they have an additional market to cater to. Since the online boutique is an integral part of the Ferrero Company the market share of Ferrero increases. Looking at the above points we can say that opening an online boutique will have a positive impact on its other business segments.

Conclusion: Ferrero’s online boutique is a unique personalised platform that has a focused market but with wider easier accessibility and time saving for the consumers. The gifts are also packaged in a personalised way pertaining to an individual’s choice creating a unique bond between the company and customer. The above factors show a positive growth in the brand image and equity for the company. The marketing environment analysis also shows there is a good potential for an online store.

The impacts caused by the online store towards its other business segments is also positive hence we can conclude that opening up an online boutique would be a profitable enterprise for Ferrero Rocher. Answer 2: Technology driven Marketing In today’s world technology forms an integral part of our everyday life and due to this the business world is also shifting its focus towards technology looking for an efficient way to market its products. The internet technology in particular has helped greatly in bringing the customer closer to their favourite brands/products.

Ferrero Rocher is not an exception to this. Ferrero Australia started a facebook page and an I-Phone application to promote one of its products ‘Tic-Tac’ and that proved to be a great strategy as that enabled them into releasing limited editions of tic-tac, creating more brand awareness and share for the company. Ferrero Australia’s Online Boutique is itself a marketing strategy in a way as it uses technology to target individual consumers and strives to create a lasting relationship with them which is basically direct marketing using technology (Kotler, Armstrong, Agnihotri, & Haque, 2010).

Ferrero can further use the internet technology to increase the customer loyalty towards the brand by customer relationship management. This is basically obtaining information about the individual customers to give a personalised output to the customer hence increasing the brand loyalty. This can be done by creating a personalised account in the Ferrero’s online boutique website while placing an order.

The information provided in the account can then be used by ferrero to make the customers use the online store often by adding personal touches to the company-customer relationship like sending birthday/anniversary wishes by e-mail/SMS/MMS, keeping them informed about special occasions and upcoming events thus making them realise they are not an individual but a part of the ferrero rocher family. Ferrero can also offer e-discounts and small gifts to valued customers making them feel more special and hence increasing the brand loyalty.

Ferrero can also use search engine optimisation by creating tie-up with search engines like Google, Bing to enhance its brand awareness online. The usage of smartphones is on the increase now and ferrero can use this to their advantage by creating mobile applications for not only engaging with customers but enabling them to buy. This can be done by developing applications which enables the customer to buy ferrero products via their mobile phones which makes it even simpler and convenient for the consumers and it is this convenience that will increase the brand loyalty for the company.

Ferrero Rocher can also develop dedicated pages in social networking sites like Facebook, Twitter worldwide where there is a direct platform for the company to know its consumers better and cater to their needs accordingly. Ferrero can also utilise dedicated YouTube channels to keep the consumers informed about various happenings about the company which will keep the consumers ‘hooked’ to the company. New technology like QR codes can also be used by Ferrero where they can promote their products by offering special discounts to those who have synced their devices with the Ferrero’s code.

The online gaming industry is also on the rise and since kids are a potential market ferrero can sponsor online gaming tournaments, creates more online games hence creating huge brand awareness and a positive brand image among the younger generation. Conclusion: Ferrero has already started a facebook and i-phone application in Australia but starting a dedicated worldwide group in social networking sites will create a larger yet a personalised platform between the customer and the company.

Creating personalised mobile buying application will enable convenience for the consumers. Also utilising search engine optimisation and QR coding would enable the company to reach out to the tech-savvy individuals. Furthermore, ferrero can combine CRM strategy with technology to create more brand loyalty among the consumers worldwide.

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