Chocolate confectionery accounts for 58% of the market value of French confectionery. It reaches a value of 2, 26 billion. Ferrero has a large market share of the chocolate confectionery market; approximately 22 % by value; but it does not dominate that market as much as it dominates the market spread. It represents about 440 million of the turnover of the company. On this market, Ferrero highly differentiates itself from competitors with innovating and conceiving new and original products such as the chilled snack. The market of the snack is at its maturity stage, but Ferrero has almost created a new market, the one of chilled snack, and provides new products on this market. On the market of snack, it is hard to compete and gain ground because there are numerous substitutes and a large number of competitors who focus on this market whereas it is just a little part of the activity of Ferrero.
[...] In super and hypermarkets, Ferrero products are scattered in all the sections of the stores, then Ferrero products can be seen several times by the same person when shopping. - Presentation: packaging is very important for Ferrero, so this company pays particular attention to its products' packages and elaborates them well. Its products are recognizable thanks to the dominant colors, white and red. - Price: Ferrero products can appear expensive compared to the prices charged by the competitors and the prices of the substitutes. [...]
[...] External analysis: Opportunities Threat Sponsoring Ferrero with Kinder is Anti-obesity campaigns the sponsor of the ‘Fédération française de Basket' Associated -thank to ads- with Some serious competitors in France, sport, actions, good health and Cadbury Schweppes plc, Nestlé S.A., well-being. Altria Group Inc. Perceived as sane products Competitors offer lower price associated with sport Promotions during public holidays Associated with conviviality and family This market of chocolate confectioneries is full of brands, this market has reached its maturity stage, to be competitive on this market, Ferrero has to provide customers not only tasty and high-quality products, but also innovative and new products. [...]
[...] Kinder Maxi Kinder Choco Fresh Kinder Bueno Ferrero Rocher Mon Chéri Raffaelo Ferrero Duplo Ferrero Garden Kinder Bueno Chilled and snacks accounts for almost of the turnover of Ferrero, but on this market full of efficient competitors Ferrero is ranked number 4. In this market, Ferrero was among the first companies to offer chilled snacks with Kinder Pingui, which appeared in France in 1996. SWOT analysis Internal Analysis Strenght Weakness Ferrero: precursor of chilled snack All products are made with chocolate Family and friendly atmosphere Expensive Taste appeal to children and adults Temperature variations damage the products, above all, chilled products Package and mascot, Kinder Pingui and the penguin Original products External analysis Opportunity Threat Advertisements, promotions and Many substitutes for snacks for gifts presented with the products example fruits or bundles of a pen ‘gagnez les champions', cereals, biscuits, yoghourts etc. [...]
[...] Business Unit Strategy Strategic segmentation As Ferrero offers a different range of products, from spread to pocket candy, its activity can be divided easily into four homogenous segments given this internal criterion: - Spread - Chocolate confectionery (bar included) - Pocket candy - Chilled Snacks For each of this segment, Ferrero has a different weight on the appropriate market: Market Market share (in worth) Competitive position (bar included) Source : Ferrero lecture at ESC Rouen The strategy adopted by Ferrero is different in each one of these markets, this leads to complex strategies at the business unit level, but the dominant generic strategy remains as a differentiation one. [...]
[...] Rapid renewing of stocks is expensive Old brands are like legends and well-known by customers, new brands enjoy the excellent reputation of Ferrero The company commitment, a total and global commitment to better the society Clearness of the nutritive value of the products Small portions, individual packing No communication to children, only to adults with proper language A continuously growing company since 1975 Innovation, their driving force behind their growth External analysis Opportunities Threats Large market-shares in each market Anti-obesity campaigns Wide target Price French leader of the chocolate Competitors in some markets confectionary market (chocolate with mars) First media investor for food in Light products France (drinks not included) Large list of well known brands Competitors charging lower price for same kinds of products Ferrero products are made Threat of substitute Nutella vs. [...]
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