Indulge yourself, indulge your friends and family. Chocolate can be
a treat for you as well as others.
After trying to persuade consumers they needed to buy themselves the odd
bag of toffee or box of chocolates as an everyday treat last year, chief
executive Peter Burdon has now decided that Thorntons should encourage
consumers to buy Thorntons as gifts for their loved ones too.
New research has told the British chocolate manufacturer that its
strength lies not in the pockets of the weak-willed, but in the
tradition of buying a box of continental chocolates as a gift.
Sources say the brand's 'There's lots in store for you' campaign is
under review and any new campaign is likely to position Thorntons as a
mecca for gift-buyers. The company is also in preliminary talks with
design consultancies with a view to redesigning its stores to display
gifts more effectively.
The Thorntons brand is not restricted to its 410 stores. It has a web
site (www.thorntons.co.uk) where visitors can order a range of products,
and it is rolling out its cafe operation, with a goal of opening 90
stores in two years.
Last August the brand took its pounds 4m ad account out of Rainey Kelly
Campbell Roalfe/Y&R and handed it to Miles Calcraft Briginshaw Duffy,
which created the current campaign. Rainey Kelly was responsible for the
'Chocolate Heaven since 1911' strapline, which it created in 1995.
The focus on new store environments follows several difficult years for
the company. Last year Thorntons' full-year profits were down 40% to
pounds 6.6m.
Over the past two years it has issued four profits warnings. However,
its interim results for the 28 weeks ending January 6, 2001, show that
total sales are up 5.4% to pounds 99.4m.
But will Thorntons' latest plans build on this positive result?
Marketing asked Nick Moon, director of consulting at Futurebrand, and
Kevin Twittey, chairman of direct marketing agency Triangle, which runs
Cadbury's DM.
Vital signs
Financial results 1998-2001
2001* 2000 1999 1998
Turnover(pounds m) 99.4 153.5 141.3 132.8
Operating profit (pounds m) 12.5 13.2 13.1 12.9
Figures are for 52 weeks ending June 24, 2000, June 26, 1999 and 1998
*Figures for this year are for 28 weeks ending January 6, 2001
Source: Thorntons
DIAGNOSIS
Kevin Twittey
Thorntons' change of advertising strategy, from positioning itself as
the provider of everyday treats to focusing on gift-giving, is a
recognition that in the fabricated, elevated, concrete noughties there
are few brands that can be all things to all people. It's better to have
a single-minded proposition, and never deviate from its
communication.
In today's trading environment the brand proposition is only one part of
the equation. Channel marketing can also be significant. Everyday treats
are now part of the weekly supermarket shop and Thorntons is not a
supermarket brand. People tend to buy indulgence brands from specialist
retailers where the ambiance is more appropriate to gift purchase.
There is clearly a market for quasi-luxury confectionery sold in
'chocolate houses', with all the attendant imagery. Thorntons' would do
well to take a look at a North American chain called the Rocky Mountain
Chocolate Factory. It sells indulgence, which happens to come in the
form of confectionery.
Thornton's retail estate must be a key contributor to its sales and
profits. Get it wrong, and profits will continue to slide.
Nick Moon
Thorntons occupied a favourable niche position when it first launched
with its special toffee and chocolate assortments. They were special
gift purchases with an element of originality. A Thorntons purchase was
something special and more thoughtful than just another box of Milk Tray
or Black Magic.
Since then it appears that Thorntons has failed to evolve its original
positioning. At the same time others have caught up. The chocolate
collections of Marks & Spencer et al have very much improved and more
recent entrants such as Whittards offer an alternative competitive
offering.
Now it needs to avoid becoming just another multiple UK high street
store.
It needs to become the English chocolate specialist and take on the
qualities of the English tea room or the Viennese coffee shop. It should
sell drinking chocolate, coffee, chocolate gateaux and champagne, and do
for hot chocolate what Starbucks did for coffee, by inventing
variants.
It's about time Thorntons went back to the drawing board, looked at its
store environments to change mood and lighting, and recreated the magic
that once made Thorntons a delightful gift.
TREATMENT
Twittey's tips
- Give the stores a complete makeover, to reflect the ambiance of a
gift-purchase outlet.
- Develop a comprehensive communications and promotional programme, both
to underpin the gift positioning and to achieve tactical trading
objectives.
- Build brand franchise by developing new channels of distribution for
gift packings.
Moon's makeover
- See the film Chocolat and apply the little shop philosophy
- If Haagen-Dazs can make ice cream sexy, then Thorntons can do the same
to chocolate - express its sensual, aphrodisiac qualities.
- Build mood, add music and enhance the aroma - but avoid the sugary
smell of a US mall.
- Return to a focus on the special quality of chocolates as a gift.
