Brand Community: Marketing Strategies and Promotion of Nutella

This case study analyzes Nutella's brand management, focusing on brand equity, brand resonance, brand positioning, and brand valuation. It highlights the success of Nutella's online brand community ('My Nutella My Community') through customer empowerment, while acknowledging the inherent risk of brand hijacking. The report explores key marketing strategies implemented by Nutella, including focusing on the breakfast market, tapping into universal desires (though controversially), and capitalizing on social media platforms. It also discusses the advantages of customer-centric approaches in reducing marketing costs and fostering brand loyalty. The document concludes by emphasizing Nutella's consistent efforts in building strong customer relationships to achieve brand success. Desklib provides access to similar case studies and solved assignments for students.

Running Head: Marketing Strategies and Brand Promotion
NUTELLA’S BRAND
COMMUNITY

Marketing Strategies and Brand Promotion 1
Executive Summary
This report present’s the case of brand management of Nutella which is an Italian company
engaged in the business of manufacturing of hazelnut chocolate spread. The company has
successfully managed to maintain in brand in the market using various important branding
theories such as brand equity, brand resonance, brand positioning and brand valuation. Each
of these brand theories helped the company in creating its unique identity in the market. The
online brand community formation (My Nutella My Community) of the company through its
customer empowerment approach has allowed it to reach its maximum recognition in the
market. However, the said approach has always imposed a consistent risk of brand hijacking
on the company. Brand Hijack is the situation when the consumers take away the control over
the brand of company from the marketing professionals by re-appropriating it.

Marketing Strategies and Brand Promotion 2
Table of Contents
Executive Summary...............................................................................................................................1
Analysis of various concepts of branding:.............................................................................................4
Relevant Branding Theories:..................................................................................................................4
Question 1: Brand Community and its used to enhance brand equity:...................................................6
Question 2: Key marketing strategies that Nutella implemented to build its brand community:...........8
Question 3: Risks for Nutella in using customer empowerment" approach to creating a brand
community...........................................................................................................................................12
Recommendations:..............................................................................................................................13
References:..........................................................................................................................................14

Marketing Strategies and Brand Promotion 3
Analysis of various concepts of branding:
A brand is a name, design, symbol or a term that is used by the seller for the unique
identification of its product or services in the market so as to differentiate it from the products
or services of other sellers in the market. In the present case the concepts of brand
community, brand loyalty and brand equity are analysed as these concepts are closely
connected with the brand management system of any organisation. However, with the
creation of brand communities with its customers, the company has to face the risk of brand
hijacking throughout the life of its product.
Relevant Branding Theories:
Strategic brand management of a company mainly comprises of various branding theories
which ultimately leads to creating brand equity for the firm. These theories are:
Brand positioning:
This theory is directly related to the success or downfall of the brand in the international
markets. When the company decides its target market it needs to draw the basis to position its
market by defining clearly the points of parity and differences.
Brand resonance:
This theory reveals the companies relevant ways to maintain sound relationships with its
customers.
Brand elements:

Marketing Strategies and Brand Promotion 4
This theory sets out the trade-mark tools that help the firms to create unique identification of
brand in the market from the rivalry firms.
The value added by a company from the goodwill that has been achieved by it over a
considerable period of time and unique recognition of its products and services is called as
the brand equity (Aaker & Biel, 2013).

Marketing Strategies and Brand Promotion 5
Question 1: Brand Community and its used to enhance brand equity:
One of the key concepts of branding is the creation of brand communities in the market.
Brand community constitutes tools like innovation management, customer relationship
management and other highly valuable marketing techniques. Communities are often formed
by the persons who have common beliefs and opinion for a particular thing or idea. The
brand communities are majorly classified in two categories i.e. online brand communities and
offline brand communities (real-life communities). There can be various forms of these
communities such as small or large ones, temporary, permanent, static or periodic or
customer initiated or firm initiated. Online communities are formed using the platform of
social media such as social networking websites. The said communities are usually formed by
the appraisers of a particular brand or a company itself. Also, these communities provide the
significant platforms for millions of consumers across the world to connect as well as
exchange their individual ideas, opinions and other valuable and relevant information
(Francisco, López, Anaya, Aguilar & Molinillo, 2015). These are created on the specific
website of a brand. The main reason why people are adopting these brand communities is that
they wish to share their ideas and opinions with the other admirers of the concerned brand
and the actual interaction between the members also attracts them towards formulation of
such communities. Offline communities are however those communities that are formed by
the people in the real world and they are not formed on the virtual platform. These
communities help the firm in building effective connection between the users of brand and
the brand owner. One of the major advantage of building online brand community is to allow
the individuals from across the world to interact with the other individuals who possess
common believes and idea in regards to a particular product or service. These communities
provide the most effective medium to the markets to achieve success of the brand in which

Marketing Strategies and Brand Promotion 6
they are dealing. The rapid rise of information technology in the recent era has allowed the
companies to market its products and services in the innovative ways so that it can maximise
its customer base. Online brand communities have the key potential to represent itself as the
prime marketing instrument. The internet marketers are looking forward to these OBCs as the
strongest business opportunities as it will enable them to influence the purchasing behaviour
of the customers worldwide (Belk, 2010). Also, it enables the companies to entertain and
value the beliefs and opinion of their customers. Through the internet mediated brand
communities, the brand owners can exchange the relevant knowledge and facts about the
uniqueness of the products that they are dealing or marketing in and also it can allow the
brand admirers to show their passion about the particular brand and the desired performance
in terms of quality and satisfaction to the brand owners to that they can maintain their
standards and wherever required, improve them up to the satisfaction and expectation of the
brand followers.
Figure 1: Nutella's Consumer Relationship Management

Marketing Strategies and Brand Promotion 7
Question 2: Key marketing strategies that Nutella implemented to build its brand
community:
In the modern world, the ever increasing competition between the businesses has drastically
enhanced the value of branding of different products and services. The intense completion in
the market has resulted in the changed buying behaviours and the manner in which
consumers undertake their purchase related decisions. Due to this fact, the brand has not only
been recognised as the important asset for any company but also it has persuaded the
marketers to form such strategies that enhance the strong brand equity for their products.
Brand equity is the brand’s total value, considering it as a separate asset. It is the total value
of assets and liabilities that are directly attached to a particular brand name or sign (Burger,
2012). It is quite important for the brand owners to maintain its equity in the market through
various strategies such as formation of specialised brand communities on the virtual base
using different social networking sites such as: Facebook, twitter etc. These communities not
only enhance the market share of any particular brand but also it increases the overall value
of the product’s brand in the market (Medium, 2017). The brand which has positive and
strong brand equity is capable of charging more price than the actual price in the market
(Gunawardane. 2015). The brand communities facilitates the brand owners to show their
followers that they respect and encourage their ideas and opinions and they always strive to
provide them the maximum level of desired results(Keller, Parameswaran & Jacob, 2011).
With the due advantages of social networking, brand management has become quite
convenient with less financial cost and less time consumption.
In the integrated system of marketing communication, brand communities are considered as
the most powerful tool. Nutella is recognised as the most renowned brand for the sweetened
cocoa spread as manufactured by and Italian company. The formed brand stimulus Nutella is
boasted by a strong, lively and crowded brand community on the virtual platform. The name

Marketing Strategies and Brand Promotion 8
of the online brand community of Nutella is Nutellaville (Myers, 2017). The said brand
community is quite effective in context of contribution, commonality as well as
complementarity with the integrated marketing communication system. The image of the said
brand within its online community is collective set of various mental associations that are
overlapping the other communication tools i.e. commonality as well as the new mental
associations i.e. complementarity which are referred as the dimensions of brand image. As
nutella has been in existence since more than 50 years it has already build a huge fan
base from all over the world (Nutella. 2015). It is has become one of the most commonly
recognised brand in the national as well as market. It has reached the threshold of becoming
the national obessesion from being the simplest edible item with the use of effective
marketing strategies. The popularity of the brand has grown so rapidly and steadily since its
existence though the formulation of powerful branding strategies. The major strategies that
enabled nutella to become the favourite brand of millions of its users are:
Focus on the breakfast market:
When nutella entered the U.S. market, it branded itself as the suitable substitute of various
products such as chocolate, frosting stuff, jam etc. It has influenced the people from all over
the world to use it in several different ways. In year 2009, it initiated focussing purely on its
branding to become the most commonly identified breakfast staple that is generally put on
toast or waffles. This was the move that facilitated the consumers in understanding its best
use.

Marketing Strategies and Brand Promotion 9
Figure 2: Various consumption ways of Nutella
Tapping into a desire that is universal:
This was the second marketing and branding strategy. However, it proved out be
controversial. It has started marketing itself to be considered as an important part of a
nutritious and healthy diet. Though the company had never expressly claimed its product i.e.
the hazelnut spread to be a healthy edible item but still the company has deliberately branded
the chocolate spread to be related to the balanced diet. This branding strategy was so cleverly
executed by nutella that it made the Ferrero which is its parent company to change their
advertisements and settle for a law suit against nutella for 3 Million in the case of issuing
deceptive advertisements.
Capitalisation on social platform:
When the nutella’s product entered into the homes of various consumers, the company started
sharing innovative ideas and usage of their chocolate spread through the use of social media.
The social proof served the company to convince the existing and potential customers about
the product’s value in terms of quality and level of satisfaction. The formation of online

Marketing Strategies and Brand Promotion 10
brand community has allowed the owner of brand to use the pages of social media to embrace
its engagement with its customers. The strategy of nutella to grow its foundations of its
admirers into the thrall of its fan group by being intensely focused on the social media efforts
can be observed through various networking sites (Walter, 2018). These efforts helped the
company to prove that its products are more than the mere breakfast item.
These were the three prime strategies that were used by Nutella to create its brand community
so as to achieve the ultimate success of its products. Moreover, the companies which are
using the customer centric approach to operate their very business are not required to invest
huge sums of money to identify and attract new customers. When they stay in touch with
their brand communities they are not required to carry out intense researches to identify what
their customer want. The brand loyalty has been achieved so far by the company through its
consistent efforts towards building the best relationships with their customers (Vozza, 2014).
Figure 3: Nutella's Fan Page on Social Media

Marketing Strategies and Brand Promotion 11
Question 3: Risks for Nutella in using customer empowerment" approach to creating a
brand community
It has been realised by far that the development of advanced information technologies has
facilitated the brand management system of any organisation with the most economic and
time efficient ways to reach and interact with their customers. However, it is still necessary
for the companies to choose the best suitable brand community of its customers and focus on
cultivating the interaction with their customers and stay closed with the social engagement.
Brand communities are the main form of consumer communities as formed by the brand
owner so as to adopt the customer empowerment approach. It allows the customers control
the variables that predetermined by the marketers. This approach is primarily focused on
maintaining best relationships between the brand owner and brand customer. This approach
allows the company to share various kinds of concepts, ideas and believes with their
customer about the products that are dealt by the company so that they can stay tuned with
their customers. Also, it allows the brand owners to know more about the expectations and
passion of their brand followers. Nutella takes into account each consideration relating to its
consumers and their tastes and preferences. Their prime brand management is achieved
through maintaining the brand loyalty for its ultimate consumers (Vision Critical, 2018).
However, there are various risks associated with the customer empowerment approach for
creating the brand community. Too much concentration on branding can make the company
lose its control over its brand which is replaced by the consumer group who tries to re-
appropriate it. Nutella might have to face its brand’s hijack which occurs when the customers
takes away the brand of any company from its marketing experts to increase its evolution.
This approach might lead to diversion of company’s key focus over profitability. The
ultimate objective of Nutella’s existence is the achievement of desired level of profitability.

Marketing Strategies and Brand Promotion 12
However, if the company remains focused on its customers and fulfilling their expectations, it
is quite possible that it might lose its focus on its prime goal of achieving profitability
position. If only customer empowerment approach is used by Nutella to promote or maintain
its product’s brand in the market, the company may not be able to focus on building and
maintaining sound and effective relationship with the retail vendors of its product.
Recommendations:
It is quite necessary for the company to keep proper interaction with the dealers of its
product in the market so as to analyse and assess the demand of chocolate spread. Therefore,
the company must also make adequate amount of efforts to maintain a b2b brand community
along with the consumer community. The company must make further initiatives to
participate more in the brand communities so that it can stay stunned with the demands and
preferences of its existing as well as potential customers.

Marketing Strategies and Brand Promotion 13
References:
Aaker, D.A., & Biel, A.L. (2013). Brand Equity & Advertising: Advertising's Role in
Building Strong Brands. 3rd edn. U.K: Psychology Press.
Belk, R.W. (2010). Research in Consumer Behavior. 5nd edn. U.K: Emerald Group
Publishing.
Burger, M. (2012). Brand Equity and Brand Value: Explanation and Measurement. 1st edn.
Schweden: Books on Demand.
Francisco, J., López, M., Anaya, R., Aguilar, R., & Molinillo, S. (2015). Online Brand
Communities: Using the Social Web for Branding and Marketing. 2nd edn. Germany:
Springer.
Gunawardane, N.R. (2015). Impact of Brand Equity towards Purchasing Desition: A
Situation on Mobile Telecommunication Services of Sri Lanka. Journal of Marketing
Management, 3(1), 100-117.
Keller, K.l., Parameswaran, M.G., & Jacob, I. (2011). Strategic Brand Management:
Building, Measuring, and Managing Brand Equity. 8th edn. India: Pearson Education
India.
Medium. (2017). What Is Brand Equity and Why Is It Valuable In Business? Retrieved from
https://medium.com/@inkbotdesign/what-is-brand-equity-and-why-is-it-valuable-in-
business-a2f875b5e13

Marketing Strategies and Brand Promotion 14
Meister, S. (2012). Brand Communities for Fast Moving Consumer Goods: An Empirical
Study of Members‘ Behavior and the Economic Relevance for the Marketer. 1st edn.
Germany: Springer Science & Business Media.
Myers, D. (2017). 10 things you didn't know about Nutella. Retrieved from
http://www.thisisinsider.com/facts-about-nutella-2017-4
Nutella. (2015). History. Retrieved from https://www.nutella.com/en/uk/history#1946
Samonikov, E., & Gogova, M. (2017). Building Brand Equity and Consumer Trust Through
Radical Transparency Practices. 1st edn. Pennsylvania: IGI Global.
Vision Critical. (2018). Customer Empowerment: A Manifesto. Retrieved from
https://yfwp2260wmb3b8wdx12drkyo-wpengine.netdna-ssl.com/wp-content/themes/
avalaunch_media/assets/img/CustomerEmpowermentManifesto.pdf
Vozza, S. (2014). Three Branding Strategies That Made Nutella a Business Success.
Retrieved from https://startupnation.com/start-your-business/get-inspired/three-
branding-strategies-made-nutella-business-success/
Walter, J. (2018). 3 Strategies For Increasing Your Company’s Brand Value. Retrieved From
https://www.dreamfearlessly.com/resource/3-strategies-for-increasing-your-
companys-brand-value/