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Table of contents
1 The aims and procedure of this assignment *
2 Presenting of facts *
2.1 The Market for Cereals *
2.2 The target competitors *
2.3 The Product: Kellogg's Coco Pops *
2.4 The target customer segments *
3 The Buyer Behaviour study *
3.1 Who constitutes the Market ? *
3.2 Why does the market buy? *
3.3 What does the market purchases? *
3.4 Who participates in the buying-process? *
3.5 When does the market purchase? *
3.6 Where does the market purchases? *
3.7 How does the market purchase? *
4 Marketing objectives *
5 Marketing Strategy *
6 Positioning Statement *
7 Communication Objectives *
8 Communication Positioning Slogan *
9 Communication Mix *
9.1 Advertising for Kellogg's Coco Pops *
9.1.1 TV advertising
*9.1.1.1 Reasons for choosing TV
*9.1.1.2 Advertising theme TV spot
*9.1.1.3 The timing for TV-spot sending
*9.1.2 Children Magazines
*9.1.2.1 Reasons for choosing children's magazines
*9.1.2.2 Advertising theme of the ad in children's magazines
*9.1.2.3 The timing for the magazine advertising penetration
*9.2 Sales Promotion *
9.2.1 Reasons for choosing SP and the use of it
*9.2.2 The timing for the sales promotion campaign
*9.2.3 Sales Promotion to the parents
*9.2.4 Sales Promotion to the kids
*9.3 Packaging, Merchandising and Word of Mouth *
9.3.1 Packaging
*9.3.2 Merchandising
*9.3.3 Word of Mouth
*10 Budgeting *
10.1 Costs for Sales promotion *
10.1.1 To the Kids
*10.1.2 To the Parents
*10.2 Advertising costs *
10.2.1 TV advertising costs
*10.2.2 Costs for magazin-advetising
*10.3 The budget for Coco Pops *
11 The Implementation of the Communication Plan *
12 Conclusion *
13 References *
The aims of this assignment are to produce a marketing communications plan for a brand/product or organisation of my choice. In addition rationales for the decision to use a communication tool are asked. All proposals should be costed.
For this assignment I chose Kellogg's Coco Pops for, because I think Kellogg's is a very successful company with a very powerful marketing performance. Coco Pops are competing in an increasingly fragmented market with at least one very strong competitor - Nestlé.
There is no timeframe given, so I set a frame of one year–the year 1997–for my communication plan. During this year there will be a promotion campaign to strengthen/regain sales volume from Nestlé. In addition I try to include the normal promotional actions during the rest of the year.
At first I will analyse the current situation by presenting all the facts necessary to set effective goals and strategies. The presentation of facts include the market data, the competitors as well as the target segments and the product itself.
Afterwards, I will make a buyers behaviour study. I decided to make this study here, because it is important to know the buyers behaviour before placing the communication tools. The buyer behaviour study is part of the assignment for students of the 3rd level.
I will continue with the setting of general Marketing objectives and strategies. Then I will give a positioning statement of the product and I'll set communication objectives and a positioning slogan. Having all this done, I should be able to construct a communications plan.
In the text I often make a distinction between 'normal' budget (i.e. the costs for advertising, when the normal timing pattern for TV or magazines is applied) and 'budget for the campaign' (i.e. the costs arising, when only the additional costs for the reminding campaign are ment)
.
In spite of recession, the cereal market had grown in the recent years, with enormous rates.
Between 1990-1995 the market achieved annual growth (in volume terms) of 3.3% per year.
The sector has grown by 24% (annual rate 7.2%) over this period of time in real terms to reach a volume of over £1 billion in 1995. That means 443,000 tonnes.
The huge variety of the whole market brings me to the assumption, that it is a mass-market. The Companies apply target marketing in its segments. They target one segment (e.g. sweetened cereals) and tailor products for the needs and wants for this special target-group.
The market can be roughly segmented into :
·
cold ready to eat cereals (e.g. cornflakes, muesli)
The reasons for this are on the one hand, the increasing figure of woman working outside the house, on the other hand the growth of one-person households, as well as the change towards healthy food in peoples opinion.
Moreover the companies are responding to this trends with much new product launches in short time (especially in the Muesli segment to provide the healthiness fashion) and with tremendous amounts of money being spent on advertising and promotion (especially for the children cereals to enforce 'pester power').
Now it is important which segments of the whole cereal market are growing. So the next table shows the cereal market divided into the main segments
A very sharp rise is performed by the sweetened breakfast cereals. In this segment the so called 'pester power' from the kids plays a big role in the purchasing habits.
As mentioned above I want to take a closer look on a special product called 'Coco Pops from Kellogg's in a special market segment (sweetened cereals). So I've tried to get some shares in this segment. The most actual I found was from the key-notes research on CD-ROM from 1993. Here, the share of Kellogg's Coco Pops is about 3% of the cold RTE cereal market (Key Note Report 1994).
The market is increasingly fragmented. Here is the following situation in shares:
The market of the sweetened cereals could be segmented more deeply, because not all products are made for children (e.g. Kellogg's Crunchy Nut). To reduce the scope of competitive products, I'll take the niche 'chocolate breakfast cereals' into consideration. Here are the main competitor products and my close competitors.
Despite of all the many products in the market, there are mainly four big competitors: Kellogg, Cereal Partners, Weetabix and Quaker
Kellogg is market leader with a declining share of 42,5% in 1995 and an average growth of 9,4 %.
Weetabix is second with a share of 13,9% and an average growth of 7,3%.
While the other three companies are owned by multinationals, Weetabix is an independent British Company. Its competitive product for the chocolate flavour share is 'Weetos chocolate flavour'.
A tremendous average growth have the Cereal Partners brands with 58% and a share of 8,2%. Cereals Partners is a joint venture between the American General Mills and Nestlé.
Due to the joint venture, Cereal partners are able to provide the customer with a huge variety of products ranging from Muesli to modern sweetened Cereals. The company sells under the well- known name Nestlé.
Especially for the segment of chocolate flavoured cereals, Nestlé is the main target competitor. In 1994 they launched Nesquik Chocolate Flavour Breakfast Cereal in addition they have Coco Shreddies. The advantage against Kellogg's Coco Pops is, that the brand name 'Nesquik' which is already well established for and strongly associated with milk and chocolate (Nesquik milk drink). Nestlé's products are gaining more and more share. Therefore Kellogg's Coco Pops must be brought back in consumer's mind.
The fourth, Quaker has a big average increase, too and a share of 6,4%.
Quaker is the leader in the hot-cereal market with a share of more than 50%.
The own label brands have a relatively big share. That's because of their low price compared to the market leaders. They have their own chocolate flavour cereals. TESCO's are named 'Coco Puffs' and Sainsbury's 'Coco Snaps'. These products have the same texture than Coco Pops. Here the advertising must emphasis the superior quality of Kellogg's product.
Kellogg's Coco Pops is one of the really long established products in the niche of chocolate breakfast cereals. Recognising the sales volume of this sector, other manufacturers appeared with its products. I've mentioned them already.
In contrast to Kellogg's Chocos, Coco Pops are made for the younger children.
Kellogg's Coco Pops have that scrummy chocolate taste combined with good-for-you grains of rice, vitamins and iron. They're packed with carbohydrates, a great source of energy. Plus they contain folic acid, which helps kids to develop. All this and they're 99% fat free!
So, mums are happy because their kids are eating a nutritious breakfast to start their day, and kids are happy as they enjoy their delicious Kellogg's Coco Pops breakfast.
The healthy contents of Coco Pops are:
Thiamin (B1) & Niacin : Help release energy from food.
You need energy to keep your body active.
Riboflavin: Helps your skin skin and eyes stay healthy
Vitamin B4: Helps you keep healthy skin and nerves
Vitamin B13: Helps your blood cells grow and develop...and its importnant
To a healthy nervous system
Iron Helps you to keep your red cells healthy and to carry oxygen around
The body.
(taken from the Kelloggs Home-Page UK)
The main target group of sweetened breakfast cereals are children and teenagers.
In the case of Coco Pops, the young children aged 6-12 are targeted.
(What should not mean, that the older ones don't eat them.)
These children are belonging to parents which can be segmented by age of 25-45. These young (25-34) or mid-aged(35-45) couples are belonging to the peak of the heavy-and middle users in Great Britain. Nearly two third of each of the two age brackets are heavy or medium users. The reason for this is the likelihood to have children in their households.
An evidence for the influence of children is, that (heavy-)usage of cereals fall steadily with age. Moreover in households with children only 1.5% of the housewives don't serve RTE cereals, while in houses without, 10% don't serve breakfast cereals.
The children are the target consumers and the persons I will aim my advertising to. The parents are the buyers in the process and their behaviour has to be analysed in the following buyer behaviour study.
Regarding the social classes, the penetration is fairly steady with a slight fall 'among group E, those living at the lowest levels of subsistence.' (MINTEL). Therefore the segmentation after this criteria is useless in this case.
By region, penetration is fairly equal, too. There is a light peak in East and West Midlands, while penetration is lowest among Londoners.
When advertising, there don't have to be differences regarding social classes or regions. Kellogg's Coco Pops is a product that can be advertised to all children over UK through all social classes. Therefore TV is an important medium.
With the growing markets these days, the contact from the marketing decision makers to the customers is becoming more and more distanced. To address the actual buyers is vital for the company's success. An accurate allocation of capital to the right channels (reaching only the targeted groups of people) is using money more efficiently. This development made a distinction between customer groups necessary. Therefore Companies divide the whole market into target segments.
Moreover it is important to analyse the point of time (in the customers decision process), at which the consumer should become aware of the advertisement. This enables the company to spend the money for advertising even more accurately. Therefore analyses about the buyer behaviour have been made, to bring light into the 'black box' customer.
To understand the above targeted buyers in their behaviour, some questions have to be answered shortly known as the seven O's.
The market is constituted by the target customer segments of children (6-12) with their parents (age brackets 25-34;35-45) who buy the product (chapter 1.4). On the other side there are the companies with their products. All this is described in the first chapters in more detail.
The children as the consumers want Breakfast cereals, which are trendy and all their friends eat, they don't want to be outsiders. According to an article in 'The Guardian'(27/01/97) "My daughter can identify and name every single product that her friends eat regularly: when the gap between what a child and its peers eat is too great, the child feels uncomfortable-to children conformity in food is just as important as in clothes".
Moreover they like sweet things and chocolate.
Children are influenced by television ads. The huge amount of spots especially for kids food is still increasing. In a survey cited by the same Guardian article, "85% of children had asked their parents to buy them food they'd seen advertised on TV and, given their fabled 'pester-power', got it". In the table of MINTEL, 41-50% of the parents ( in the targeted ages) admit to buy what children want. "Studies have shown, that small children are ferociously brand loyal, with a remarkable memory for jingles."(Guardian 27/01/97)
Another important thing is, that the children food market has become a branch of entertainment. Cartoon characters (e.g. The Clown from McDonalds or the Monkey from Kellogg's Coco Pops) are already familiar to children from toys and the TV ads.
All these issues are explaining the 'pester-power' children have. This power influences strongly the buying behaviour from the parents and the following table taken from MINTEL:
The parents ( in the two regarded age brackets) as the buyers of the cereals, are influenced buy the whole family and tend to have a variety of cereals in their cupboard. In case of Coco Pops, they are only influenced by their children.
The buyer behaviour is influenced by a strong experience in quality and healthiness. Both is provided by the TV advertisements of the big cereal companies. Therefore parents prefer to buy well known brands. 47% of the younger age bracket housewives prefer well known brands and 40% of the older bracket. Coco Pops are fulfilling these two needs from the buyer, too, as mentioned in the product description. If they won't be disappointed in this regards, they reward it with a high brand loyalty. Even the younger aged housewives are looking for the healthiness of their children's food. So if the Coco Pops monkey provides the children with arguments when 'pester-powering' their parents, a purchase could become a bigger likelihood.
About 20 per cent of housewives in each of the two analysed brackets is looking for special offers (the peak in the table) especially ABC housewives. (This table is related to the whole cereal market. In case of children cereals, gifts are much more important) .For Coco Pops it is important to have gifts in the box, because children will look at it. It is a buying argument for the children. They will try to persuade their parents.
The same for the figures in the column "Tend to buy what children like". Coco Pops are made for children and the children persuade their parents to buy them. Therefore the peak of this column is in the regarded age bracket (people there tend to have children in the right age). The children need rational arguments (Vitamins, reduced fat etc.). The parents should recognise these arguments on the box when standing in front of the shelf.
The market purchases products (in the sweetened cereal market) the children like. Features like high quality and healthiness must be supported buy advertising and package design and the product, of course, because the housewives are buying the cereals. They want to have a good conscience when they opt for Coco Pops.
There are different person involved in the buying process:
Buyer: The buyers are the parents form the children, mostly the housewives. They have the money and will decide ultimately what to buy. In this case the mother is the decider, too.
Influencer: The influencer is the child, who practices pester-power on their mother. The main aim of the advertising should be to strengthen this power. The children are consuming the product after getting it, so they are the users, too.
The initiator could be both the child and the mother. The child could see the product in the TV or get informed buy a friend and ask for buying it. The mother could recognise the need to buy new cereals for the kids and write it on the shopping list.
Breakfast Cereals are a every day product, so there is no long decision making process before in general. The buying behaviour can be described as a variety-seeking behaviour with low customer involvement. Because of the high variety, brand switching can occur easily.
The housewife buys Coco Pops:
a) when recognising the need for Cereals at home.
b) in a suddenly decision (without planning it) , when the kid
asked in the supermarket to buy Coco Pops.
c) for certain occasions or to reward the kids
(housewives, who don't often buy sweetened cereals)
The aim of Kellogg's as the market leader should be to encourage the habitual buying of the customer. The frequent reminding advertising to the children can help here. The continuous pester power makes the parents to get used to buy Coco Pops. Otherwise the kids will be dissatisfied.
The cereals are normally sold in bigger supermarkets, because small retailers don't have the space and the money to sell them in a huge variety.
The main place of selling Coco Pops are the larger supermarkets like TESCOs or Sainsburys, as well as all the others.
This is a challenge to the package design because of the big variety. The box must be striking in comparison to the competitors products with big eye-catchers like the company logo (brand loyalty) or the Monkey (eye catcher for kids). In addition the buying arguments with which the kids are provided in the advertising should be recognised buy the parents quickly (e.g. The money holding a sign where the vitamins and their meaning for children's health are mentioned).
The 'How' of purchasing refers to the buying process as a whole. Therefore I cite a simple buyer-behaviour model, which I try to adapt to the purchasing process of Coco Pops.
The model enables me to determine the communication gaps, which have to be filled with advertising/promotion.
The following model was the easiest I found in the literature. I have modified it to Coco Pops:
The process according to the model above begins with the recognition of the mother, that new cereals for the kids are needed. This could happen one morning at home. She will make a notice in her shopping list. All the next steps are mostly happen in the supermarket.
Breakfast Cereals aren't such a valuable product, that long information collecting and decision processes (if at all) have to take place. The mother can only be informed buy a TV spot she sees in the morning TV before she goes shopping or get influenced by her child (at home or in the supermarket).
Otherwise she gets the information when standing in front of the cereals shelf. At this point of time it is important that:
·
the child has done a good preparation that the mother chooses Coco Pops·
the package design persuades the mother to buy Coco Pops instead of anotherThe housewife buys the Coco Pops when she takes them out of the shelf and puts them into her trolley.
The post purchase dissonance can arise to the mother, when doubts about the real healthiness occur. On the other side all worries fall away, when she sees her child smile while enjoying Coco Pops. The satisfaction should result in a repeat buy of Coco Pops.
Buying models have the task to show the gaps, a company has to fill with appropriate communication when selling its products. During explaining the buyer behaviour model, I have mentioned which of the communication tools I want to use (and when I want to use them).
Strengthen and extend the existing market share of 3% against emerging competitor's products, like Nestlé's 'Nesquick chocolate breakfast cereal' in a three month promotion campaign. As the market leader, Kellogg's should encourage the habitual buying behaviour.
·
Conduct a three month reminding campaign aimed at the main target group (children 6-12) and the buyers (their parents 25-45).Kellogg's Coco Pops: The healthy, fat free chocolate breakfast cereal meal for the young children. Careful chosen high quality ingredients and a mild preparing are providing the kids with necessary vitamins they need for the day, without refusing the chocolate they like.
·
Maintain Coco Pops as the preferred chocolate breakfast cereal among 45-50% of the'Coco Pops are the mega-choky cereals all children like'
Kellogg's must now divide the total promotion budget for Coco Pops among the communication tools.
For each tool I'll explain the use, the objectives sought, the strategy and its timing. The budget for the tools I'll calculate in the next chapter.
At the end, I'll draw a total timing plan, mentioning again the costs arising at which time.
In the advertising the product is presented to the target consumer through mass-media like e.g.: newspapers, TV or magazines. The consumer should develop a certain opinion about it.
Kellogg's spent huge amounts on advertising its products. For a successful advertising, the Marketing must make some decisions:
·
Advertising objectives- Make children to apply their 'pester power' to the parents (buyers)
- As the market leader it is important to keep the products in the top-of customer's mind
·
Advertising strategy
A suitable 'selling person' must be chosen to give children the necessary arguments to persuade their parents.
This could be Coco the Monkey. Children like animals and trust them.
to remind the children regularly TV spots are sent in all big TV stations. Moreover advertisements are made in some big children's Magazines and comics.
during the reminding campaign, the frequency of advertising is increased to create a top-of the mind awareness and a preference for Kellogg's cereals.
I chose the following media for advertising:
Children are very sensible for visual and acoustical influences. Moving pictures say more than static ones. The movement and sound attract children's attention and involve every sense. With this media, many children in the targeted age can be reached. The impact of the medium TV is very high on the kids.
The funny Monkey 'Coco' is an eye-catcher and attracts children's attention. They can recognise him on the cereal box easily. In addition, they will feel sympathy with the character. Through this sympathy the whole product gets a positive image for them.
As mentioned in the table (chapter buyer behaviour), 41%-50% of the parents tend to buy what their children like. That means, when the TV spots make the children asking their parents to buy Coco pops, the half would do it. With the additional campaign in the summer the influence of the children will grow and more parents will buy them Coco Pops.
TV is a good medium for Coco Pops, because all children watch the same programmes independent of social class. TV spots placed in times children are watching, have a high coverage.
The Monkey Coco jumps in the jungle from palm to palm and sings a happy song, which the children can easily remember. The text contains the key-words 'Quality', 'Healthiness', 'mega chocolate taste'
The spot already exists from the year before and has a duration of 30 seconds.
Basically two things have to be taken into consideration referring for general timing patterns. Coco Pops is a product that is often purchased. As a result, the advertising has to be very continuous to place the product in the top of children's mind.
Secondly, it is important to have a look on the 'forgetting rate' (the buyer or targeted person (children) are forgetting the advertisement). In the case of Coco Pops, children could forget advertisements often, because of the huge amount of other spots during TV-shows. This is another argument for a constant advertising level over the year.
The communication plan covers one year. As mentioned at the beginning, I will conduct an advertising campaign in the middle of the year. The campaign has a duration of three month.
For the advertising over the year with TV I will apply the following pattern:
Legend:
|
Spot sending |
X |
X |
|
Weeks per month |
2 |
2 |
|
Days per week |
3 |
2 |
|
In Morning |
2 |
0 |
|
In Noon |
2 |
2 |
|
In Evening |
0 |
0 |
Generally, I will apply a constant intermittent timing pattern to prevent boosting the annual budget.
In the 'normal year, spots will be sent in every second week of the month. Within this weeks, two spots will be sent per TV station on two days in the afternoon (Every second month; one week within this month; Two days with three spots each (in the afternoon) within this week). In the following Table, Weeks with a 'normal' sending pattern are printed as a normal, capital 'X'!
During the summer campaign, two spots both in the morning and in the afternoon, on three days a week, every second week of the month will be sent. This pattern is applied during the first two months of the campaign. In the last month, the promotion is well known under the kids, therefore advertising can be cancelled then. TV advertising weeks during the reminding campaign are printed as a bold, underlined capital 'X' letters. In addition I will paint the cells grey.
I introduced advertising in the morning, because at this time, kids have holidays and stay at home (the older part of the targeted age bracket). They can watch TV in the morning and probably will go shopping after this with their mothers.
The regional (I)TV stations are following the same sending pattern, whilst the cable stations are shifted among one another, so that there are ads every week. I chose those stations with a high population coverage:
The regional stations together have a coverage of 86.5% of all Households in GB. The other are covered by the satellite TV stations and Cannel 4 I chose:
These national stations are covering a huge amount of children in the desired age.
Magazines are relatively cheap in relation to the audience they reach. Because of the high variety in the market, advertisements can accurately be placed. The most important advantage to the TV is that the message can be read again. The pictures placed in print-media are static and have no sound. The impact on children is not so high as TV spots.
One advantage of magazines is, that the real number of children that can get in touch with the ad is 2-3 times higher than the circulation, because the magazine can be lend or shown to friends.
The ad is a full colour page to attract children's attention. It is made like a comic with the following theme:
The Monkey Coco meets his friend the elephant in the jungle. The elephant is sad, because he has no delicious cereals for breakfast. Coco gives his friend a portion of his Coco Pops. The elephant is happy again and after enjoying the breakfast, both are dancing and singing the slogan: 'Coco Pops are the mega-choky cereals all children like'.
At the end a big picture of Coco the Monkey could be printed holding a sign, where the important vitamins and their function for the health are listed.
The comic style makes the children to get used to the Monkey as a normal Cartoon character, linked with Coco Pops (like the TV ad). They identify the 'dead' brand with an animal or comic character they like and can speak about him. This supports the reminding campaign in the summer as well as the already existing character merchandising of Kellogg's.
I'll place the ads in 13 nation-wide Children magazines. Two of them are pure girl magazines (Pony in my pocket, Barbie) and two are boy magazines (Soccer Stars and Action Man). The ads in this magazines are being placed in every second issue and complementary (see table).
E.g. one month, ads are placed in Pony Pocket and Soccer Stars, the following month they are placed in Barbie and Action Man. It is important, that there is sold a pure Boy and Girl Magazine with a high Circulation every month.
The other Magazines are made for both genders. Here, ads are placed in the same pattern. In this case, a constant coverage over the year is provided. All magazines chosen have a high circulation (highest in BRAD).
In the three month reminding campaign, there will be an ad in every issue of each magazine to increase the awareness of the kids. In the summer, the children are often playing outside the house and can take the comics to their friends.
The themes of the magazines are covering a big variety of different interests of the children aged 4-14.
The issues of "Our school"-magazines are covering a big variety of topics. They are distributed for free in primary schools, the ideal area for the Coco Pops ads. Here, children can talk and laugh about the comic-ad with Coco.
The "Fun to learn"-magazines are covering the right age group of children, too. Children in pre school ages should read them together with their parents. Here an optimal scene for applying the "pester-power" is set. Children can talk with the parents about Coco Pops when they see the ad. Parents will read the information about vitamins at the end of the Comic-Strip.
The bold printed figures during the summer campaign (grey painted cells in the table) are the additional costs for Magazine advertising during the campaign. The resulting costs are belonging to the extra budget for this campaign.(Chapter 10.2.3) !
Sales Promotion is a below the line activity and is used as a short term incentive to encourage the purchase of a product. In the case of Coco Pops I want to use Sales Promotion to trigger the buying action. Sales Promotion should give the buyer an additional reason to make the buying decision and to buy again !
Moreover, my sales promotion should reward the loyal buyer for his faith as well as make new customers to buy Coco Pops (regularly). I decided to make a sales promotion for the Buyer and for the consumer.
The two sales promotions should be the main activities in the reminding campaign in the summer.
·
The objectives for the Sales promotionThe sales promotion should trigger the decision of the buyer (Housewife) to choose Coco Pops. The result: increase in sales.
Reward loyal and gain new (regularly) customers.
·
Sales Promotion strategyPrice off coupons should make the buyers to decide for Coco Pops regularly over a certain time (habituation-effect).
Price off coupons should trigger the buying action of the irresolute housewives
Cards collection for the kids should give them a further incentive to ask their mothers to buy Coco Pops Cards collection makes children to consume Coco Pops regularly and get used to them
The campaign is limited to three months. I chose the middle of the year, where the children have holidays. In addition the campaign should give the sales an extra boost. In addition,
the efforts for the 'normal' annual advertising are increased during this time.
·
For the buyer I offer 20p price-off coupons on one corner at the front of the package. The coupon must be recognised without problems, because I don't want to advertise for it. Parents should be triggered only buy recognising the coupon.
·
The second sales promotion aims to the kids. Here the boxes are containing little pictures with six different motives (one in each box) of Coco and five of his friends.The announcement will be made in the TV spot during the campaign. Therefore the TV-spot has to be changed slightly. The sentence 'Now you can collect me and my 5 friends and win prices for your holidays’ is inserted instead of a sentence, where Coco prises the quality of Coco Pops. The changes can easily be made, because the same scene at the end of the spot can be used. In this scene, the child can only see Coco the monkey speaking to the viewer!.
There are no changes in length of the spot!
Sales promotion of this kind are more efficient when announcing them in TV!
In addition the backside of the box is explaining the campaign once again in more detail.
Other reasons for justifying sales promotion:
the recession make people interested in price off bids
have one more buying argument in 'shelf space war'
relative cheap and effective
The result: Parents will buy Coco Pops more often. Their children get used to it and don't want to refuse consuming them. They will ask their parents to continue buying them !
These two communication tools are also worth having a look to. Especially the packaging design plays an important communication role.
In the high competitive market of Coco Pops, it is important to attract the attention of the buyer. Especially when the product is placed in the shelf with all the other brands. Packaging can act like a silent salesman, helping the customer to make his decision for the product.
On the shelf (and at home) it works permanent as a advertising tool, because everyone sees it, every day.
·
Packaging objectives- communicate with the buyer
- build up the image of a healthy product (showing vitamins of the Coco Pops)
- inform the customer
- offering special bids
- recognition effect for the kids
- persuade and convince the buyer
·
Packaging strategy- communicate through good readable offerings on the front of the box
- build up image through an are where all vitamins are listed
- recognition through showing a big figure of Coco the monkey
The packaging should communicate to both, mother and her child. The special offer coupon in the summer campaign and the listed vitamins is a buying argument for the mother. The child is being attracted by the big money and the chocolate brown colour of the box.
The back of the box provides more detailed information e.g. to the summer campaign or contains comics or games during the rest of the year.
Costs for changing the package design are hardly to estimate. Therefore I assume, that the printing is made within the company and no further costs for changing the box are arising.
Merchandising is used to give the brand 'Kellogg's' some life. Especially when selling products for children this is very important. 'Coco the Monkey' is one of those characters who gives the dead brand some life. He's a funny guy, children like and can speak about.
Kellogg's has a huge (character) merchandising repertoire. In case of Coco the Monkey, the figure is printed of cups, plate, sunglasses etc. In this assignment I used the merchandising for the sales-promotion to the kids. When they make use of the cups and plates, they can eat every morning their cereals from the plate. It would be ugly for them to eat e.g. SAINSBURY'S 'Cocos' from this plate, they hardly would do this.
In addition they see the motives on the plate every morning. This is an implied communication function, too.
The advertising themes are supporting the 'reincarnation' of the dead brand to a living figure. They show comic strips, which children in the targeted age like. Therefore TV advertising is so important. Here the pictures are 'alive'.
The Word of Mouth is an effective medium that's free of charge. Both the housewife and the children can speak about Kellogg's and their products (e.g. Coco Pops). The way they speak about them is influenced partially by the communication tools. On the other hand people have their own experiences with Kellogg's.
The advertising to the kids and especially the sales promotion with the card collection will make the kids to speaks about Coco Pops. They have to collect and swap the cards to receive the prices.
The sales promotion to the parents (price offs) will make the housewives to speak about this bargain. To justify their decision additionally, they will think about the vitamins of Coco Pops. When they see their satisfied kids eating the products, they will be satisfied, too and will tell it to their friends.
All these factors will promote the sales of Kellogg's Coco Pops.
There are no rules of thumb, which industry send which amounts of money to each tool.
Kellogg's generally spent the most of the budgets to TV advertising. For Coco Pops this allocation is suitable, too. I will now go through the communication tools and calculate the costs for each tool.
Kellogg's want to boost sales with a reminding campaign. For this reason the company extends the normal budget for Coco Pops. The campaign runs simultaneously with the normal advertising. For this reason, I'll separate the costs into the components for the 'normal' annual and the campaign budget.
In the next chapters there is a detailed explanation of how the costs of each media are composed:-
The Sales Promotion to the Kids consists of the six pictures of Coco and his friends to collect. The pictures outer dimensions are the same as play card formats. The pictures of Coco, and his friends (Elephant, Tiger, giraffe, snake, hippo) are printed on a thin cardboard covered with a layer of polymer. The ready printed cards can be bought from a supplier. One card will cost 7p.
The cards are put in the boxes (one in each box). The campaign has a duration of 12 weeks. To provide a regular sales volume of the boxes, every two weeks the motive of the card in the box has to be changed. The mothers have to buy (at least one box every second week). This succession, of course, isn't announced in publicity.
The volume for three month is roughly (40,8m boxes p.a. / 4)=10,200,000 boxes
Þ 10,2m boxes * 7p = £ 714,000 costs for picture cards.
At this point; I have anticipated the calculation of the market share volume of Coco Pops. A detailed calculation you can find in chapter 10.3 Budget for Coco Pops.
I assume that every kids will collect 6 cards and send them in for a present. The costs for the presents will be ass follows.
Costs for sun-glasses: 30p
Costs for cup with motive: 40p both articles are produced by supply companies.
The demand for each article is derived from the sales figures in our character merchandising.
Demand sun-glasses: 60% (because of summer)
Demand cups : 40%
Because of future campaigns Kellogg's expects an increase in sales buy 12% (by volume) per month:
Þ average monthly boxes sold (40,800,000/12)=3,400,000 boxes per month
Þ 110% sold = 3,740,000 boxes per month*3months
Þ 11,220,000 boxes over the three months campaign sold
Þ 935,000 boxes per week (one week consumption time until buying new box)
WITH price off campaign (12% more sales): 935,000 boxes per week
Without campaign : 850,000 boxes per week
These costs arise, when only 10% more customers will buy. When a higher percentage level buys, a profit is possible. For the calculation I take the worst case (experiences of last campaigns!).
While writing this assignment, I wasn't able to find TV-costs. In BRAD there are only very few and not from the stations I wanted. I phoned the stations or wrote them e-mails and received answers from some (regional) stations.
I think the received costs are enough to have an idea of costs that have to be paid. So I estimated similar costs for the stations without prices.
To separate the costs for the campaign from the 'normal' advertising budget, the total costs for the advertising campaign (£1,728,000) are deduced from the total (TV) advertising costs (£5,292,000). Then the costs for one 'normal' month (£432,000) are added. The result is the 'normal' annual budget for TV advertising without a campaign of £3,996,000.
Total TV advertising costs with campaign: £5,292,000
– Total TV advertising costs for the campaign – £1,728,000
+ Costs for one month of 'normal' advertising + £ 432,000
= Costs for advertising without campaign = £3,996,000
This amount of money is added to the normal annual budget. The costs contributing to the campaign budget are the difference between £5,292,000 and £3,996,000. The result is: £1,296,000. This is the amount for the campaign budget.
Additional costs are for changing the (verbal) end of the already existing spot. Here the kids see the monkey Coco speaking 9 seconds to them. This scene was especially made for those purposes. In the old spot he explains how healthy Coco Pops are. In the new version he does it, too, but also tells the kids about the campaign as already explained in the chapter TV advertising.
To change the spot to the new text costs: £10,000
The costs for magazine advertising you can see in chapter 9.1.2.3 where the timing for magazine advertising is planned, because I made both in one table!
The total costs are £159,425. Estimating a timing pattern without campaign (every second issue), the bold printed figures fall away. The resulting amount of money for the 'normal' advertising is : £159,425-£27,275=£132,150
During the summer campaign, there will be ads in every issue of the magazines. The costs for publishing the ads in this issues (differing from the normal publishing pattern) are involved in the budget for the campaign.
The sum of all bold figures from the table in chapter 9.1.2.3 is £ 27,275.
As pointed out in the presenting of facts, Kellogg's Coco Pops Market share in the market of sweetened cereals is 3%. I assume that Kellogg's is setting its budget as a certain percentage related to the turnover of the individual product.
In this assignment, I've applied the 'objective and task' approach to set the budget. At first I have calculated the costs for advertising (money that is needed to achieve the goals set). Now I'll set a budget for Coco Pops. In reality, I think, it is normally reversed.
First, I must estimate the market share for Coco Pops for 1997 , because I only found figures from 1995.
Market share: 3%
Volume 1995: 443,000 tonnes (annual growth 7.2%)
Þ 1997 Volume = 443,000*1,0722 » 510,000 tonnes
Þ 3% from 510,000 tonnes = 15,300 tonnes = 15,300,000 kg = 40,800,000 boxes (à 375g)
Þ Price per box £1,85= £ 22,054,054 Turnover
Here are the total costs for the communication at one glance:
The total costs for TV and Magazine advertising are £5,461,000. The percentage part of the Magazine costs is only 3%. That is normal for a company like Kellogg's, which is mainly advertising in TV.
The normal budget for annual advertising during the whole year is set to a percentage level by 18% from sales turnover.
Þ 20% from £22,054,054 » £ 4,500,000 total annual bnudget. This is the amount that can be spent over the year (excluding the reminding campaign).
In addition, Kellogg's pays £3,7 million for the campaign to achieve the goals set at the beginning. The money that remains after covering the costs is used for monitoring the results of all achievements.
I think these figures are realistic ones regarding to the figures mentioned in the literature. "In the Summer of 1995, Kellogg launched a six month campaign, worth £6 million, to back the launch of Sustain..." (MINTEL, Breakfast Cereals Study, 1995).
After all this planning for the communications plan, there is the question of how he is implemented in the companies activities? What action have to be done at what point of time? Of, course, I can't imagine all the necessary steps involved in implementing such a plan, but for the most obvious actions, I have chosen a (Microsoft) Project Plan to illustrate the succession of actions during and before the implementation.
The plan on the next side shows the action, its length in weeks, the beginning and end of the action as well as the department in the company that is involved. In addition a Gantt-Diagram is visualising the succession of the action graphically. The column 'Predecessor' shows the actions that have to be done before the regarded action can take place.
The Milestones are certain dates, where all actions contributing to reach the aim of this stone have to be finished.
For example, the annual advertising has to be planned in 1996 when the spots and advertisements are shown from the first of January.
I think the plan is good to understand. To avoid misunderstandings, I will explain some actions next:
Action No. 1 and 2 : Here the time-span for the 'normal' (annual) and 'campaign' - advertising patterns is shown.
Action No. 3 and 4 : The use of the 'normal' annual communication tools and the budget has to be planned so early, because after this, the media have to be booked. According to BRAD, especially spots for TV-advertising has to be booked 4-6 months before sending them. Therefore this early planning.
Action No. 10 and 11: The planning for the campaign in June, July of 97 can start in 1997, because it is enough time. All spots and ads can be booked in time before sending them.
After planning the communication tools, the budget is set. After the budget is set, the tools can be booked and other actions, that cost money can be done. This is important, because the budget should be justified by the responsible person, before money can be spent.
The same situation in in 1996 when planning the annual communication tools and budget.
Action No.24: It is important to monitor the results of the campaign. I will start with it after the TV-advertising pattern for the campaign is ending to secure a, early end of the monitoring and to have enough time for doing it.
Action No. 26: At last at this point of time the planning for the next years advertising has to be started. Otherwise there could be problems with booking the sports etc.
Making a communications Plan involved many steps including the permanent setting of objectives and its strategies. Both have to be adapted continuously to the changing regulations outside the company. Besides all economical or political changes, the customer should not be forgotten.
In a time where the distance to the customer is becoming larger, it is very important to communicate in a right way to the customer. The amount of 'noise' that disturbs the communication should be decreased. Especially advertising to kids can be disturbed easily.
During writing this assignment I became aware of the ethical side of this issue. Is it ethical to influence kids in this way? Is it ethical to make them to a tool which applies its effective 'pester power' to the buyer (parents)? Those questions are difficult to answer, especially in such a high competitive market such as the cereal market.
On the other hand the advertising in these segments is becoming more and more the character of an entertainment branch. Comic Cartoons are entertaining the kids to buy things they want.
Finally, it is up to the company to decide the measure of ethical and enough and its up to the customer what he buys. In the case of Coco Pops the housewife should decide what is good for her child(ren). Sometimes it could be instructive for a child to hear a 'no'.
Market Research Studies
MINTEL Studies: Breakfast Cereals, 1994
Advertising, April 1996
Key Data CD-Rom : Food Study, 1994
Books
Kotler, Saunders, Armstrong, Wong :"Principles of Marketing" European Edition, Prentice Hall 1996, ISBN 0-13-165903
P.R. Smith: "Marketing Communications- An integrated Approach"; Kogan Page 1997, ISBN 0-7494-0775-1
Internet
ITV Homepage
Kellogg's Homepage