Thorntons New Marketing Strategy

1. Situation analysis

Company

Thorntons is the biggest independent chocolate and confectionery company in the United Kingdom. The company was founded in 1911 by Joseph William Thornton and is based in Derbyshire. It has has a wide range of products, like chocolate bars, truffles, chocolate mints, Easter eggs, and more. A customer can also create his own unique chocolate box with his favourite chocolates, or write his own message in chocolate.

Thorntons counts more than 600 stores across the UK (Thorntons PLC, 2012) and in 2011 had its 100th birthday. In the last years the company has had a decline in profits and it is considered to be in a very difficult situation. From the Financial Summary provided in the Thorntons PLC official web site (Thorntons PLC, 2012), we can see that in 2009 the company had a Pre Tax Profit of £8.09m, which declined by 24.1% in 2010 to reach £6.14m and in 2011 it had a Pre Tax Profit of -1.07m for a decline of 117,4% respect to the previous year.

Product analysis

Thorntons has a wide variety of products, some of which are specialized for specific occasions and celebrations. Thorntons products can be purchased online, in a Thorntons store or in different retailers, like super markets. The prices mentioned below are the prices listed in the official web site of the company (Thorntons PLC, 2012). The main categories of products are:

Chocolate bars: There are different kind of bars, with white or dark chocolate, bars with mint, with pistachio, with fudge, with strawberry and more different tastes. The price of a chocolate bar varies between £0.75 and £2,99, although most of the chocolate bars have a cost of £1,79 and if the consumer purchases three of the same kind, the price is £5. Also a customer may buy a chocolate block bundle with multiple chocolate blocks, which cost, depending on the number of blocks, from £11 to £30.

Boxed chocolates: A customer may also find different kind of chocolates in a box. A box may contain milk chocolates, chocolate pralines, chocolate truffles, mousses, mint chocolates, truffles with alcohol, white or dark chocolate, with Continental chocolate being the most popular box. The prices vary from £2.99 for a small box to £49.99 for a 4-layer chocolate box or £65 for a package with 4 chocolate boxes. Also the consumer can design his own box with his photo and his favourite chocolates or write a message using chocolate truffles as letters, for a price that begins from £14.

Hampers: In Thorntons there are different kinds of hampers that a customer can find. There are the chocolate hampers, that contain several chocolate bars, bags and boxes, some of which are designed and marketed for a specific occasion, like "Congratulations Hamper", "Thank you Hamper" or "Good luck Hamper". The price of the chocolate hampers vary from $10.99 to $75. Also there are the Champagne & Wine Hampers, which may contain a bottle of Red Wine or Champagne, that come together with a box of chocolates. The price range is between £25 and £230. The sweet hampers, specially designed for sweetaholics, contain different kinds of sweets, like Sherbert Fountains or Dib Dabs, and depending of the number of sweet a sweet hamper contain, it may cost £25.50, £27.50, £46 or £50.

Bags: A bag contains chocolates of a specific taste, like strawberry, coconut, vanilla and more, and it may cost from £0.75 to £2.79 Two bags of the same kind that cost £2.79 may be purchased for £5.

Flowers: In Thorntons, a customer may also buy his favourite flowers, like roses, tulips, and more, accompanied by a box of chocolates. The price varies from £35 to £55.

Seasonal gifts: There are also some products, that are made especially for a specific celebration or occasion. Easter eggs are the most popular seasonal gifts. There are Easter eggs of different sizes and tastes, that may cost from £0.75 for the smallest ones until £14.99 for the biggest ones. There are also chocolates with a special shape, like bunny shaped chocolates, or chocolates in the shape of a car or a shoe, that cost no more than £7. The company has been promoting special gifts for Mother's Day and Valentines Day, including boxed chocolates or hampers, with a specially designed message. Finally, there are products designed for weddings, like Organza favours, that cost £27, oriental blossom, that contains two or four chocolates and may cost from £1.25 to £2.5, or chocolate trays that cost £25.

Greeting cards: There are Birthday cards, 'just because' cards, wedding and anniversary cards, congratulations and good luck cards. Each one has a message, appropriate for each occasion. All cards have a fixed price of £2.99.

Market analysis

In the market analysis there has been used some input by Capstick (2011).

Market demographics

The confectionery industry is addressed to the whole population, since there are consumers of confectionery products of all ages and different social grades. However, certain products of this industry are more appealing to some particular market segments. As we can notice in Table 1 in Appendix, chocolate bars are usually more appealing to people of ages 20-44, while chocolate boxes are preferred by people of ages 25-54. Other sugar confectionery products attract more people in ages 25-44. We can also notice that mints, in particular, are preferred by teenagers or people of age 65+. Regarding the social grades, there are no major differences. The most important difference is in chocolate assortments and other boxed chocolates, that are mainly preferred by people in higher social grades, while other sweets are preferred by people in lower social grades, as we can notice in Table 2 in Appendix.

Market trends

The market trends in confectionery products in the United Kingdom are related to the global recession of the last years. There has been a swift in the social habits of the consumers, who due to the recession are more likely to spend a cheap night at home than an expensive night out. This change has affected the consumption of confectionery products in an increasing way, since many consumers usually accompany their in-home entertainment with some chocolates or sweets.

In the last years, consumers are turning more and more towards healthy eating, mainly because of the warnings of Food Standard Agency (FSA) that concern the dangers of consuming big amounts of unhealthy ingredients, like sugar. This trend has affected confectionery companies and has made them reduce the unhealthy ingredients