Product price at different retailers
The process of marketing Aero Nestle chocolate bars in Canada demanded allocation of various prices in different retail outlets. Product differentiation and packaging appearance strategies have also been adopted to market the product.
Various outlets are retailing the product with slight price differences in order to convince customers into buying them. Moreover, the customer friendly adverts provided in the Appendix had positive impacts to the firm’s revenue. The adverts have cleared the suspicion that customers believed that most marketing campaigns are just mere scams intended to blackmail them[1].
The Candy land stores retails Nestle Aero milk chocolate at $2, Amazon marketplace retails Nestle aero mint chocolate at $2, Cost Plus World retails Nestle aero peppermint at $2, and the Christmas Central Retail Store sells at $3. All these stores have adopted close price ranges for the product given that customers go for lower price.
The highest price of $3 adopted by some stores is a marketing tactic because they offer after sale services which other stores do not offer as a result of higher marginal cost of doing it. This has actually positioned the marketing of Aero Nestle product for customers to access them.
Pricing strategy
Pricing strategy is defined as a distinctive strategy where marketing team adjusts the price of its products basing on the cost of production, distribution and the price offered by the competitors. The Nestle Chocolate Bars have adopted this strategy by pricing their product based on the competitor-based pricing policy and setting prices on the same margin with its competitors[2].
This is evidenced by the graph in the appendix section showing how Nestle intensive pricing strategies generated high revenues within a short period of time. The Nestle intends to intensify the marketing of the Aero Nestle products because of the stiff competition offered by rival firm in the same industry
Fine-tuning price tactics
Fine-tuning tactics are strategies meant to convince customers to buy more of a product. These tactics adopted for the Aero Nestle are the quantity and functional discounts. Quantity discounts are offered when customers buy more and get their prices reduced by a specified margin which vary in different retail outlets. The functional discounts are offered to the retailers and distributors so that the final price offered for the product is customer friendly[3].
A company will benefit from the increased turnover and high customer base. Moreover, fine-tuning tactics should be exercised after undertaking a thorough competitive intelligence so as to gather all the necessary data. Without such an exercise, a firm can find itself offering huge discounts hence lowering their long term revenues. On the other hand, without discounts may make the product expensive thus swaying away potential customers to rival firms.
Comparative summary of prices
The main long time competitor of Nestle is the Cadbury. Their competition intensifies as time goes where prices are often affected. The prices of the product from both firms fluctuate by one or two dollars in most retail outlets. This shows a high level of competitiveness thus allowing customers to benefit from the reduced prices.
In some outlets, Aero Nestle products are quoted as high as $8 and $12. This is because of product differentiation and packaging strategies. In these stores, Aero Nestle has some other ingredients such a mint, orange and milk flavors which gives the customers a wider range to choose from.
Place strategy
Due to geographical positioning of customers, Nestle retails Aero on various online shops through which customers can have the products delivered to their doorsteps. These retailers are Amazon marketplace.com, British delights, BellaMia Store stores, Canadian favorites, Candy land stores, and the British Delights.
This strategy places the company in a unique position to market its products to customers from all over the world[4]. Moreover, the retail outlets caution the firm against the cost of distribution to final customers. This is also an added advantage because it enables the firm to concentrate on its core business while at the same time maximizing the shareholders value.
Non-store retailing strategy gives the company an opportunity to market Aero Nestle products in a customized environment. These avenues are the mail order shops, online shopping and vending machines installed at strategic points such as parties and busy streets. It should be noted that non-stores retailing have a wider coverage than the retail confectionaries and supermarkets. For example, more customers can access the vending machines placed in the streets or at the work place.
Nestle products are usually located in a confectionary section in a retail store given that it contain sugars. This is also a strategic positioning by the marketing team so that customers buying other food products can by chance or intention spot and buys them. This is a better approach of positioning the products in a retail store so that the customers will have an opportunity to compare with other brands and prices. Therefore, they will make an informed purchase decision[5].
Distribution intensity
Distribution intensity of the Nestle products is usually high in every geographical area. This is because of its efficient pricing, distribution, after sale services and the production capacity. When these factors are taken into consideration, the supply of Aero would meet the demand thus avoiding shortage.
In addition, distribution intensity ensures maximum customer awareness about the product on sale. Since Aero Nestle product is available in different brands, potential customers may not be aware of them. Therefore, it is only through distribution intensity that these products are availed to customers at the right time[6].
Comparison of the distribution
It should be noted that the distribution tactics of Nestle and Cadbury in the chocolate industry is similar owing to the fact that they are competing for the same market. Both firms have intermediaries who are the retailers and therefore, most of their products are found in same retail outlets worldwide.
However, Nestlé’s approach is more comprehensive and covers a wider geographical area than Cadbury. This has given them a vast recognition in many countries for supporting various health charities while at the same time enhancing the product distribution
Bibliography
Cadogan, John. Marketing Strategy. Los Angeles: Sage, 2009.
Haberer, Jenny. Disneyland International Marketing Mix International Marketing Mix of Disneyland Hong Kong. München: GRIN Verlag, 2010.
Richter, Tobias. International marketing mix management: theoretical framework, contingency factors and empirical findings from world-markets. Berlin: Logos, 2012.
Rogers, Stuart C. Marketing strategies, tactics, and techniques: a handbook for practitioners. Westport, Conn: Quorum Books, 2001.
Appendix
Sample advertisement statement
“We are fully and truly committed to responsible consumer advertisements that enable customers to make informed decision”
Graph
Graph showing the increased revenue collection from the sale of the Aero product with intensive fine-tuned prices strategy
Footnotes
- Tobias Richter. International marketing mix management: theoretical framework, contingency factors and empirical findings from world-markets. Berlin: Logos, 2012.
- John Cadogan. Marketing Strategy. Los Angeles: Sage, 2009
- Stuart C Rogers. Marketing strategies, tactics, and techniques: a handbook for practitioners. Westport, Conn: Quorum Books, 2001
- Tobias Richter. International marketing mix management: theoretical framework, contingency factors and empirical findings from world-markets. Berlin: Logos, 2012.
- John Cadogan. Marketing Strategy. Los Angeles: Sage, 2009
- Jenny Haberer. Disneyland International Marketing Mix International Marketing Mix of Disneyland Hong Kong. München: GRIN Verlag, 2010