1.0 Introduction
Nestle is the largest food and beverage company in the world which was founded by Henry
Nestle in 1866.The company owns several major consumer brands including KitKat, Nescafe
etc. The main products of the company includes milk products, powered beverages, ice-cream,
chocolate and confectionary. As for this assignment, the chocolate from Nestle, specifically
Nestle KitKat has been chosen and will be discussed (Armstrong, 2010).
Companies such as Cadbury with its well-known Dairy Milk, Mars with its famous M&M,
Hersheys with its well-known Kisses are the main competitors of Nestle with its well-known
KitKat in Malaysia. In this highly competitive market, KitKat must use clever marketing tactics
chocolate
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4)Cadbury dairy milk chocolate
Market Share
High Low
Stars
Q uestion Marks
KitKat
Noodles
Mineral
Water
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High
Cas h Cows
Dogs
Nesquik
Powerbar
Market Growth
Energy
Nescafe Barr
Low
Cash flow is indicated by high market share and low growth rate of the industry. The brand
Nesquik of Nestle together with Nescafe can be regarded as cash cows (Jain, 2005). The business
units that are regarded as stars, have high market share as well, however; the growth rate of
industry is faster and higher. The mineral water packaged by Nestle as well as the brand Nestle
Pure life can be regarded as stars. The Question marks is indicated by low market share and high
growth rate of industry (Moon, 2012). Maggi noodle can be considered as Question Marks. The
business units that are regarded as dogs hold a small and low market share with low potential of
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market growth. The brand named Power bar and the main product that was developed under the
2.0 SWOT
Strengths Weaknesses
Nestle (Rth and Netzer, 2016) KitKats are not provided in the
development capability(Rennhak,
2017)
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Opportunities Threats
al., 2012)
2. Increased competition in the
The strength and opportunities of KitKat are very significant. One of the most important
strength of KitKat is being owned by Nestle which is the largest food and beverage
company in the world. This is a very big promotion for KitKat and facilitate the market
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penetration whereby Nestle productions are of high quality standard and image in the
eyes of consumers. Besides, the main opportunity of KitKat is expanding market growth
in emerging countries such Malaysia and in the rural areas of this country.
PESTLE
Economic The main economic factors that have an effect on the sales of
(Makos, 2015)
If the interest rate, tax rate goes up, then the price of KitKat
If the wage rate goes up, this may affect the demand of
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(Makos, 2015)
2013b)
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Legal The company has to deal with changing nature of regulations
(Team, 2013a)
2013a).
KitKat knows that the main economic factors that have an effect on its sales includes:
Wage rates, taxes and interest rates. Moreover, the company needs to be responsible for
both the ingredients that are used in the manufacture of the product together with utilizing
certain amount of specific ingredients (Association, 2011). The company need to use
machinery to increase the production. KitKat at also needs to adopt the latest technology
in production. Besides the company can involve its customer in production of KitKat
PART 2
3.0 Objective
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Kit Kat objectives are below
This strategy attempts to increase market share within the existent industries, either through
finding new customers or selling more products to the established customers usually through
adopting marketing mixs promotion element. KitKat tried to sell more products to the
established customers and used market penetration on an annual basis through KitKat
christmas packaging and advertisement which helped increase sales throughout festive
period.
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4.3Product Development
This strategy needs the company to develop new competencies which can appeal to the
current market. KitKat can adopt product development strategy and focus on developing
extensions of products such as Kit Kat Green Tea or other flavors like KitKat Durian in
Malaysia. The company can develop KitKat durian because this fruit known as king of fruit
is one of the Malaysian most favorable fruit and it has been known that is very beneficial for
health so KitKat with durian is expected to attract the attention of many people in Malaysia
(Steel, 2010).
KitKat Durian
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Kitkat Green tea
This strategy needs the company to sell its existing products to new markets which could be
new geographic base or new consumer base. Due to the nature of the product, KitKat cannot
target anew customer base, therefore; the company need to emphasize on selling its existing
products to new markets such as rural areas in Malaysia (Poh Chuin and Mohamad, 2012).
4.5 Diversification
Under this strategy, the company is required to introduce new offerings in to new markets in
order to increase its market share. This strategy is very risky as product together with market
development is needed. KitKat Oat Bar is considered a new product because it is no longer
just plain chocolate bar but more to a healthy snack like granola or energy bar. It also
ventures into a brand new market where health is the main issue. The target consumers are no
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longer limited to those who are simply looking for a snack but also those who are leading
5. Segmentation
Geographic segmentation
This segmentation will divide the market in to different geographic units such as regions, areas,
etc. The focus is on South East Asia region, Malaysia. The company will focus on urban and
Demographic Segmentation
There is no age, sex, income and any other kind of limitation on use of the KitKats products.
KitKats products are for all including children, adults and aged people. Any age group can use
Malaysia is multi race country and KitKat products can be used by all races in this country. In
addition, there are various religions in Malaysia including Muslims, Hindu and etc but the
company does not have any limitation for any religion and its product will serve the needs of all
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Psychographic Segmentation
In terms of lifestyle, KitKat segments believers, achievers and active people who works a lot and
needs energy during the day. In terms of personality, KitKat segments cautious, predictable and
Behavioral Segmentation
In terms of benefit, KitKat provides its products to the individuals who want to eat healthier and
less calorically snacks, convenient, easy and quick to bite and bring. Moreover, KitKat offers its
products to regular users with medium user rates who have positive attitudes toward the product
5.1 Targeting
The target market of KitKat is men and women of all age, race and religious who are enthusiastic
who have a positive attitude and look for healthier and less calorically, convenient, easy and
5.1.2Targeting Strategy
The Malaysian market is heterogeneous and customers have different wants for a product.
Malaysian want different mixes of benefits from KitKat but they have different priorities for
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each benefit. Therefore, KitKat will use differentiated Segmentation strategy in Malaysia and
will target two or more segments with a marketing mix for each segment. He provides different
5.2 Positioning
KitKats position itself in the mind of the customers as a chocolate to be eaten every time one
takes a break through its slogan have a break, have a Kit Kat
PART 3
6. Marketing Mix
6.1 Products
KitKat is the leading global brand. Therefore, it has leader product strategy. Moreover,
high quality products. In addition, KitKat adopted differentiation strategy and introduced
new products with new flavours like KitKat Green Tea Chocolate in Malaysia. Besides,
KitKat distinguished its products from its competitors products in the eye of its
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There are 3major product mix width: 4finger, 2finger and chunky bar. The product mix
width can be further broken down into their respective product lines such as chocolate,
KitKat is in Maturity stage because it has already reached wide acceptance in the market
and its sale is peak and it is going to slow down, therefore; it should adopt product line
6.2 Place
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KitKat is available in 100 countries of the world. KitKat has complicated network of distribution
channel that makes the products available to consumers everywhere and anytime that they desire.
KitKat use intensive distribution strategy. Since KitKat products is a very common product in
the market and many different alternatives are available; hence, this strategy is used to push
towards vast distribution of KitKats products. This strategy covers all the possible outlets and
display points that can be used to distribute and sell KitKats products. Moreover, KitKat use
push strategy to promote its product directly to end customers to pull through channel
(Rosenbloom, 2012).
6.3 Price
KitKat has maintained a low price throughout years for the purpose of increasing the volume and
keep its loyal consumers. One of the price strategy that KitKat use in its Malaysian market is
market penetration pricing. The company has set low price for its new product to achieve high
unit sales and maximum market share. Malaysian Market is very price sensitive due to inflation
and New Goods and Service tax rules. Therefore, this strategy may be effective in this market.
Furthermore, KitKat use psychological pricing strategy such as odd-number pricing (like RM
4.99 for Kit Kat 4 Finger) and multiple unit pricing. As such the company can package together
two or more identical KitKat products and sell them at single price. The company can also use
odd numbers that are slightly below whole-Ringgit amount (Goi, 2009).
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6.4 Promotion
KitKat promote its products using offline media including newspapers, magazines, billboards,
posters, and televisions together with online media such as websites, blogs and social media. The
company gives free sample as promotional strategy. In Malaysia, Value for money is the top
priority when shopping confectionary and chocolate products, therefore KitKat offer extra
product free of charge. KitKat advertise on YouTube and social media (Berthon et al., 2012).
This brand also advertise through pop display in mob apps. Moreover, KitKat gives coupon and
tie a coupon on the product itself. Besides, to increase consumer engagement and publicity,
KitKat organize contests yearly through social media sites such as Facebook and Instagram that
have a large number of users. In addition, KitKat, hold some events to promote its products.
KitKat try to add value to the experience of consuming KitKat by holding campaign and
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2018 Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec
Website
Billboard
Brochure
TV
YouTube
Social
Media
Contest
Event
Public
Relation
KitKat promotes its products through online and off-line media. The company advertise its
product in different websites throughout the year, on billboards for 6 months starting March
2018, on TV for 6 months staring July, on YouTube for 3 months starting February, on social
media throughout the year. Moreover, the Company publish brochure to advertise its products in
September, October and November 2018. The company holds contest to promote its products in
December 2018 and events in January and February 2018. Besides, public relation is used as a
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Marketing Tools Cost
Advertising RM 98,000
TOTAL RM 364000
Promotion Mix
RM 55000
RM 98000
RM 67000
RM 82000
RM 62000
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8.0 Contingency plan
Distribution channels such as supermarket store may have limited available slots for Kit Kat.
This threat can be prevented through early planning and giving notice to retailers.
The value of Ringgit to Dollar may suddenly drop sharply. The Malaysian consumers are price
sensitive due to inflation and New Goods and service tax. So, considering the change in the value
of Ringgit, they wont buy KitKat products if it becomes more expensive. Therefore, KitKat has
to deal with this challenge through resizing its product or repacking instead of increasing the
price.
9.0 Conclusion
KitKat is one of the main brand of the Nestle. In the highly competitive market that KitKat
operates, the Company must have very good marketing plan and strategies to be able to appeal to
different cultures in Malaysia. KitKat tries to target men and women in all ages, races and
religious who are enthusiastic who have a positive attitude and look for healthier and less
calorically, convenient, easy and quick to bite snacks. KitKat promote its products using offline
media including newspapers, magazines, billboards, posters, and televisions together with online
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