13 March, 2010

Have a break, have a ... soy?

Melbourne Herald Sun, 13th March 2010

Have a break have a ... soy-sauce-flavoured Kit Kat? Or how about a spicy wasabi-flavoured white chocolate Kit Kat? Sound tempting? I'm sorry but you won't find them at your local milk bar, not in this country.

Yes you've guessed it, where else but Japan could such a taste sensation happen - and be a huge marketing success.

In Japan, Nestle have taken line extension to lengths that are baffling to the more conservative Australian marketplace. They make Kit Kat in 19 flavours - like yubari melon, baked corn, green beans and cherries, and red potatoes. Now wouldn't they delight the kids' Christmas stockings?

But before you shake you heads and say, "They're mad," think on this. Kit Kat is now the biggest-selling confectionery brand in Japan. That's a lot of corn and potatoes, not to mention dough.

Nestle have always been flexible and innovative in their marketing. Fifteen years ago I wrote about their Relais Bebe (Baby Stop) program in France where holidaying families with babies could stop, feed their babies and have a free coffee and croissants - using, of course, all Nestle products. This was not just a one-off promotion - I see they now have 16 of them every summer.

The point is to get involved with the customer, think about what they need or desire, and think like a local. I can imagine that at HQ on the banks of Lake Geneva, Switzerland, wasabe Kit Kat would not be regarded as a good idea. Yet they let their Japanese subsidiary proceed with it, trusting their local people to know better than a distant warren of gnomes.

This is a difficult thing for a corporation to do, their instinct is to dictate. But the soft touch produces results.

Other companies are a little more cautious. McDonald's now allows the Japanese a Filet O Shrimp burger, and Pepsi gives them a cucumber flavored soft drink.

But marketing is more than product, it's distribution. Again Kit Kat have hit the jackpot. It appears that the phrase Kitto Katsu means "sure to win". This is a favourite slogan told to students about to take exams. Kinda like "Knock 'em dead kid!"

The Japanese being great gift-givers, they send their young ones off with a card and a box of Kitto Katsu bought at the local post office. Now their post offices are no more prone to selling sweets than ours are, but the marketing team managed to sew up a massive, 22,000 post office, nation-wide distribution deal. And with no competitors!

The Kitto Katsu campaign earned Nestle and their advertising agency, JWT Tokyo, the 2009 Media Grand Prix at Cannes.

Polyphenols are plant chemicals that supposedly work as antioxidants and preventers of heart disease and cancer. They are now the key ingredient in the highly popular Nescafe Excella - promoted through lyrical TV commercials starring Meg Ryan. She doesn't speak Japanese, but obviously they think she's healthy.

The company's latest initiative is a big marketing drive on the internet. They are pushing their range through Rakuten Ichiba, the largest internet >shopping mall= in Japan. It claims to have over 25,000 virtual shops, 40 million members and $8 billion in sales.

The lessons here are the most neglected truisms in business. When you hire somebody and give them a responsibility - trust them to do the job. Give them the freedom to innovate with products and markets. Sometimes they might make mistakes, but other times they will have spectacular successes.

After all, in your corporate ivory tower, what do you know about the average Japanese's tastes in chocolate?


No comments: