PGBM15 Marketing Management: Evaluating Theory and Practice

This essay critically evaluates current marketing management theory and practice, focusing on Ferrero Rocher as a case study. It includes a PESTLE analysis of the brand's external environment, covering political, economic, social, and technological factors impacting its operations in the UK. The competitive landscape is examined, highlighting key competitors like Hershey's, Nestle, and Mars, and Ferrero's market position as the world’s fourth-largest confectioner. The organizational strategy and capabilities of Ferrero, particularly its focus on hazelnut quality and customer needs, are discussed. The analysis concludes that Ferrero Rocher has significant growth opportunities due to its strong branding and competitive strategies, enabling it to sustain its market share and profitability. The essay references various marketing journals and business documentation to support its evaluation.

CRITICAL EVALUATION OF THE CONTRIBUTION OF CURRENT
MARKETING MANAGEMENT THEORY AND PRACTICE

Part 2

External environment of the brand

PESTLE analysis
• Political: In the context of UK, the change of government from the labour party to the conservative and
liberal democrat is bound to influence operations of Ferrero Rocher. There are several stringent
restrictions on the entry of skilled workers from rest of Europe and this also hampers the business
decisions of Ferrero Rocher (Kotler, Berger and Bickhoff, 2016).
• Economic: The global economic downturn did not affect the expansion plans of Ferrero Rocher and the
sales aspect remain steady. Due to economic prosperity, Ferrero Rocher is able to sell high number of
quantity which further has a positive impact on business aspects.

Contd..
• Social: Because of social factors, Ferrero Rocher has come up in the market place and people highly prefer to consume
the products according to the occasions. However, on the other hand, customers are getting more concerned about
health standards and this is the reason they look favourably towards the issue of obesity (Fortenberry Jr and
McGoldrick, 2016). Thus, currently many people have stopped consuming chocolate and candies because it increases
the issues of fat.
• Technological: In order to cope up with technological aspects, Ferrero Rocher has adopted new ways for production
and packaging process so that customer attention can be acquired. It is the role of technology only that aids Ferrero
Rocher to come up with different sorts of packages.

Competitor analysis

Contd..
• Hershey’s, Kraft Foods, Nestle Ltd, Mars Incorporated and Cadbury are some of the chief competitors of
Ferrero Rocher which sometimes impedes the business practices in pessimistic manner.
• All these competitors have been creating stern competition for Ferrero Rocher because they also offer the
same sort of products which are concerned with quality facets.
• Most often, it increases the opportunities of customer switch over and as a consequence, it changes the
market scenario. Ferrero Rocher is having potential threats from the new entrants because of the
marketing and business strategies (Di Benedetto and Kim, 2016).

Contd..
• Ferrero is the world’s fourth largest confectioner with a 5% share behind Mondelez, Mars and Nestle as per
Euromonitor international. Ferrero’s Nuttela and Tic Tac both the products are doing well and have also
highlighted rising volumes for Kinder Joy, Kinder Bueno, Ferrero Rocher and Kinder Surprise (Calder,
Malthouse and Maslowska, 2016).
• Further, the firm also made €537m in new investment during the year to underpin the product in Germany,
Canada, Italy, Brazil, Mexico and China.
• However, Ferrero has reported a before tax profit rise in fiscal 2014 which drives by a growing presence in
Brazil, Russia and countries in Asia.

Organizational strategy and capabilities
• The Ferrero Group continued to strengthen its presence in the hazelnut market in order to guarantee and improve
the quality of its raw materials. This also aids the entity to provide a unique taste in products such as Nutella,
Ferrero Rocher and Kinder Bueno (Baker and Saren, 2016). In the year 2015, the group completed the purchase
of all its equity interest in the Oltan Group (which is a market leader supplier that produces hazelnuts
chocolates).
• The vision of Ferrero Rocher is to emphasize on customer’s needs as the company is inspired by maximum
transparency and excellence in quality. In this respect, the brand (Ferrero Rocher) also maintains to consider the
interest of employees and clients; hence for such purpose, they emphasize on social beliefs.

Summarize
• Hence from the entire discussion, it can be said that Ferrero Rocher has huge opportunities of growth and success and which can also assist in
enhancing market share.
• Though, competitors exist in the market; however still Ferrero Rocher is able to maximize its strengths and capabilities. It has also been observed that
Ferrero Rocher gets an instant customer recognition due to its packaging (SWOT analysis of Ferrero Rocher. 2016).
• The chocolate also melts rarely only when it is put in high temperature; thus it increases it perishability aspects and as a result, consumers get more
satisfied. Further, it can also be said that branding strategies of Ferrero Rocher is capable enough to enhance the market share and profitability aspects.
• The entire discussion clearly states that competitive strategies of Ferrero Rocher helps the brand to become more competitive. This is also useful for
sustaining in market place for longer time period.

References
• Agnihotri, R., Dingus, R., Hu, M. Y. and Krush, M. T., 2016. Social media: Influencing customer satisfaction in B2B sales. Industrial Marketing Management. 53. pp.172-180.
• Baker, M. J. and Saren, M., 2016. Marketing theory: a student text. Sage.
• Calder, B. J., Malthouse, E. C. and Maslowska, E., 2016. Brand marketing, big data and social innovation as future research directions for engagement. Journal of Marketing
Management. 32(5-6). pp.579-585.
• Di Benedetto, C.A. and Kim, K.H., 2016. Customer equity and value management of global brands: Bridging theory and practice from financial and marketing perspectives:
Introduction to a Journal of Business Research Special Section. Journal of Business Research. 69(9). pp.3721-3724.
• Fortenberry Jr, J. L. and McGoldrick, P. J., 2016. Internal marketing: A pathway for healthcare facilities to improve the patient experience. International Journal of Healthcare
Management. 9(1). pp.28-33.
• Kotler, P., Berger, R. and Bickhoff, N., 2016. Current Focal Areas in Strategy Practice: Four Significant Management Concepts of the Past 20 Years. In The Quintessence of
Strategic Management (pp. 55-105). Springer Berlin Heidelberg