Table of contents
Executive Summary – Page 2
Introduction – Page 3
Product & Branding Strategy – Page 4
Pricing Strategy – Page 6
Distribution Strategy – Page 9
Promotional Strategy – Page 11
Recommendations – Page 13
Conclusion – Page 15
Bibliography – Page 16
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Executive Summary
This report analysed the product and branding strategies; pricing strategies; distribution
strategies and promotion strategies in order to make recommendations on how to further
develop the product and improve sales of Weet-Bix. Weet-Bix has been classified as a
convenience product and has chosen to brand itself as, “An Aussie Icon.” Weet-Bix has
achieved this through several methods such as associating itself with Australian sport,
sponsorship of the Australian Cricket and Rugby teams and also promoting it long-standing
in the market. These factors are all considered when setting the price of the product. WeetBix used cost-based pricing and value-based pricing strategies. Their product employs an
indirect distribution strategy involving their product being distributed to an intermediary
company before it reaches the consumer. Weet-Bix uses many promotional strategies such as
advertising (television and print); product placement and; sales promotions.
Recommendations include new packaging. A new sports sponsor more specifically we have
recommended the Olympics, and a promotional Olympics strategy to go accompany it. We
have also recommended researching what consumers like to add to their Weet-Bix and
featuring some recipes on the new Weet-Bix packaging.
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Introduction
Weet-Bix was first introduced to the market in 1920 as a “budget-friendly health biscuit,”
(weetbix.com.au). Weet-Bix has chosen to brand itself as an ‘Aussie Icon’, and also as a healthy
breakfast option for those who lead an active lifestyle. This strategy has proven successful, as WeetBix has been the most popular breakfast cereal in the market for 30 years (weetbix.com.au). Weet-Bix
uses cost-based pricing to support its branding as, “budget-friendly,” (weetbix.com.au) and also uses
some value-based pricing to take advantage of its successful branding. Weet-Bix level of market
exposure is intensive with Weet-Bix sold in nearly every supermarket in Australia, as well as
convenience store and even some petrol stations. The promotional strategy exercised by Weet-bix is a
marketing mix of advertising, sponsorship, product placement and special sales promotions all
targeted towards their loyal consumers.
We recommend that the company can further develop the product by introducing new
packaging to re-modernise Weet-Bix, sponsor some different sports or possibly apply more
current promotions, even possibly exploiting the Olympics.
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Product and Branding Strategy
Product Classification:
As Weet-Bix is a shopping item that is frequently purchased at a low price. There is low customer
involvement or effort and therefore it can be classified as a convenience product
Product Lifecycle Stage
Weet-Bix was first introduced to the market in 1920 as a “budget-friendly health biscuit,”
(weetbix.com.au) and is currently in the market maturity stage of product lifestyle. Weet-Bix has been
the most popular breakfast cereal for 30 years (sanitarium.com.au/about-us). This means that sales
have levelled off as Weet-bix has been accepted by most potential buyers in the market. Weet-Bix
main focus now is defending its position in the market against competitors such as Nutrgrain.
Branding:
Weet-Bix has chosen to brand itself as an ‘Aussie Icon’, and also as a healthy breakfast option for
those who lead an active lifestyle. It has achieved through promoting its long standing in the market
and by associating itself strongly with Australian sport through sponsoring the Australian Cricket and
Rugby teams. Weet-Bix also by provides several different sporting events such the Weet-Bix kids
TRYatholon (weetbix.com.au) and Brett Lee’s cricket bootcamp (weetbix.com.au). This could be
improved by sponsoring more sports such as football, as it is a very popular sport in Australia. To
improve the branding of Weet-Bix as a healthy breakfast option Weet-Bix could focus less on
associating itself with sports and sponsor a television show such as The Biggest Loser, which is very
popular in Australia and also influences people who use the show as an example for what they should
eat. This would help promote the branding of Weet-Bix to consumers who aren’t as interested in sport
but still want to be healthy.
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Packaging:
Weet-Bix original packaging
Current Weet-Bix packaging
Source: weetbix.com.au
Source: weetbix.com.au
The packaging of Weet-Bix has been changed since it was first created but has remained relatively
unchanged for many years since. The brand could benefit from a change in packaging, however the
main colours used should remain the same so consumers can still recognise the product. Sports stars
who commonly appear in television advertisements for Weet-Bix could be featured on the packaging,
or something similar to make the packaging more interesting. The aim should be to make the product
stand out on the shelf and catch the attention of consumers.
As Weet-Bix is a fairly plain product, suggestions of what could be added to Weet-Bix to make it
more interesting could be added to the back of the packaging. For example if some consumers find
Weet-Bix too plain and are thinking of trying a different breakfast cereal, a suggestion of adding
banana and honey to their Weet-Bix may be the change they were looking for. This would help ensure
that consumers continue to buy Weet-Bix.
5
Pricing Strategy
Approach to price setting
The price a company charges to the product is either too low to produce a profit or too high to
produce any demand.
Figure 1
Souse: major considerations in setting price (Marketing 8th Australiasian Edition – Kotler)
Figure 1 shows the main factors affecting the price setting for the product. The company should
consider these factors to determine the best price. In order to set up a good price, the company should
select many different factors, the cost-based pricing, value-based pricing, competition-based pricing,
performance-based pricing and relationship pricing. Weet-Bix uses Cost-based pricing and valuebased pricing strategies.
Cost-based pricing: the company sets up the price by the cost of product. Weet-Bix set up the
different product by different price, such as the original one is cheaper compare to the organic one.
The price setting are basic consider to the cost of product itself.
Value-based pricing: the price is determined based on the product’s perceived value. Weet-Bix makes
a cup of breakfast cereal in order to convenience the customer which is more expensive than a box of
breakfast cereal. The consumer is willing to pay more money for the convenience service. In this case,
Weet-Bix uses the value-base pricing strategy, which can charge more because of the value added by
the convenience service.
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Pricing strategies
Product and service mix strategies and price adjustment strategies: the strategy for the price is always
changed when product and service is mix. Generally, we are look at five product mix and service mix
pricing situation, product/ service-line pricing, optional product/service pricing, Captive
product/service pricing, By-product pricing and Product/service-bundle pricing. As weet-bix, the
companies usually develop product lines rather than the single product. Such as it provide the many
different type of breakfast cereal, the Multi Grain one or Organic one etc.
Demand based strategies: The price elasticity of demand usually has three different points, Elastic,
Inelastic and Consumers are less sensitive to price increases for necessities. As weet-bix, the price is
elastic. Cereal is kind of fast-moving consumer good, is lower price and health product. However
there are many substitute products. So that the price cannot too high and too low, the price are always
go with the value of the products.
Price adjustment strategies
Discount pricing and allowances: In order to reward customers for certain responses, the most
companies adjust their basic price, such as cash discounts, quantity discounts, functional discounts,
seasonal discounts and allowances. As Weet-Bix, is usually using quantity discounts to reward
customer’s concerns. For example, the Sanatarium Weet-Bix original 375g is $2.89 and the 750g is
$4.50. The discount provides an incentive to the customer to buy more quantity from the retailer.
Segmented pricing: The companies are always adjusting prices by differences customers, services,
products and locations. As Weet-bix, there is more expensive selling price in the convenience shop
compare to the supermarket; this price was adjusted by Location. The cost of offering each location is
the same, but the different locations are priced differently. The different versions of the product are
also priced differently. Such as the company priced Weet-Bix organic with 750g for $5.36, which is
$0.83 more expensive than the original one.
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Psychological pricing: Price is really indicates something about the product. When the customer can
adjust the quality for the product, they judge the quality by fewer prices. But when the customer
cannot adjust the quality for the product, they are willing to look at the price to adjust the quality. For
instant, if the people lack the information for the breakfast cereal, and there are two different products
for the cereal, which is 750kg for $4.50 and another is 750kg for $5.00, some people are willing to
pay $5.00 because this price indicates the quality.
Promotional pricing: The companies sometime to lower their products price or cash rebates to draw
more customers. The Weet-bix company launched its ‘Search for your share of £1m’ Sales promotion,
it offering the chance to win cash prizes from £10 up to £100,000 with an on- packs of Weet-bix in
September last year (Utalk Marketing, 2010).
Value pricing: The Weet-bix company provides the 97% wholegrain product to customers which can
provide energy to help sustain through the morning. Weet-bix is the most popular breakfast cereal in
Australia. Many of us are not eating enough grains and risk missing out on the nutrients. Some
breakfast cereals offer wholegrain, protein, vitamins and up to 30% sugar. Higher sugars are easier
have diabetes, so that people choose breakfast are more likely choose the lower sugar product.
Compare to other product Weet-bix provide the low sugar but high nutrition for the breakfast. To
protect its competitive advantage, Weet-bix provides many different designed products. Such as ‘one
Square Meal’ was designed by a meal solution for breakfast, lunch- whenever, wherever (Sanitarium,
2011).
Geographical pricing and International pricing (not relevant)
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Distribution strategy
An indirect distribution approach is utilised by Weet-Bix, whereby once manufactured they use such
retailer companies as Coles and Woolworths to be the intermediary selling stage for their product.
Once distributed to these grocery stores the consumers can then purchase the product from their local
intermediary companies. Weet-Bix is distributed over multiple grocery and convenience stores all
around Australia giving them a large degree of distribution. This large number of intermediary
companies is beneficial as “intermediaries may provide market access that would otherwise be very
expensive or impossible for the firm to secure” (Capon, 2007). This corporate channel of distribution
employed by Weet-bix makes the shopping experience for consumers simpler and makes the
purchasing of their product more efficient. This method delivers the Weet-bix product to the
consumers in a setting that they feel comfortable purchasing in. Cereal is not a specialty item and is
not an individually sought out item so consumers will purchase it along with other grocery products.
Customers that shop at retail grocery stores want to compare and contrast the product and having
Weet-Bix there gives them the opportunity to choose one brand over others and this is where the
marketing strategies from Weet-bix will play a large role. The promotional, packaging and pricing
strategies that Weet-Bix have chosen to use will influence the consumers on the first level to choose
their product or at the least become interested in the product. However, once the manufactured good is
sold to the retailer a lot of the risk and burden of selling the product now falls onto the retail company,
so Weet-Bix share the responsibility of sales with their intermediary establishments.
Degree of market exposure: There are three level of market exposure, exclusive, selective and
intensive. The number of intermediaries classifies them. Weet-bix is at an intensive level, which
outlets as many as possible. Weet-bix is available where and when customers want them, for example,
the products are outlet in supermarket, petrol satiation and convenience shop. Since Weet-Bix has a
selected target market of families and those with active kids, the product must be easily accessible.
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Therefore the intensive exposure of distribution correlates well with the markets consumer needs.
Although Weet-Bix is distributed intensely around Australia they chose the two main retail outlets
Coles and Woolworths as their intermediaries. Coles and Woolworths both have strong retail brand
names and therefore if a customer wants to purchase a cereal brand they will most likely visit one of
these two chain retailers. Overall Weet-Bix is the dominant force in distribution in the cereal market
as it is difficult to find a grocery or convenience store without the product.
Physical distribution: The Company employs the supply chain method of delivering and distributing
their product. This requires a large amount of organisation between the Weet-bix manufacturers, the
retailers and the transportation officers. Since Weet-Bix has chosen to sell their product first to large
retail stores, the task of transporting the product usually falls upon the retailer. Most often the stores
that purchase the product will have their own delivery system and the manufacturer simply puts their
order together for them to collect making it very simple.
Weet-Bix is a well-established company and since it is now in its maturity stage with an intensive
exposure level and a strong distribution strategy their only concern is to keep their product popular so
that stores will continually purchase their brand. This is where promotion strategy comes into play.
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Promotion strategy
The message Weet-Bix pushes centres upon the idea of a healthy option of cereal for kids that will
benefit them with their active lifestyle. The message draws from themes such as active lifestyles,
healthy choices, sport and family. The cheap price of Weet-Bix put together with its high quality
status transmits the idea of value for money, which is perfect for families and those on a tight budget.
Weet-Bix has a strong promotional blend in place. They use multi-media advertising, sponsorship,
product placement and sales promotions to constantly remind consumers to purchase Weet-bix over
other cereal brands. Since Weet-Bix is in its ‘Maturity’ stage it needs to continuously stay relevant
and continue to advertise strongly in order to prompt consumers to resume buying their brand of
cereal. Since it is in its maturity stage a large amount of advertising is not necessary, just enough to
remind consumers about the Weet-bix brand so that it can maintain its position as a market leader.
Advertising: Weet-Bix uses various platforms of media to advertise its product. These advertisements
include television ads, newspaper print ads, in-store displays and posters (Woolworths and Coles). All
advertisements focus on the Weet-bix message of healthy active kids, through always pushing their
slogans of “Aussie kids are Weet-Bix kids” and “How many do you do?”. However, their advertising
has been lacking recently with no television commercials being aired or released in the past year and a
low number of print advertisements.
Print Advertisement (2010)
In-Store Display and Banner (2011)
Print Advertisement-http://www.thenewspaperworks.com.au/images/StandardImage/100616_11343038_weetbix-world-cup-article.jpg
In-Store Banner and Display http://1.bp.blogspot.com/E_lAtomEhAM/TkOrnMJ716I/AAAAAAAAAEg/cGPcSL6Ylok/s1600/IMG_0079.JPG
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Sponsorship: Weet-Bix is the proud sponsor of many sporting teams and sporting activities including
My Cricket Australia, Kids Tryathalon, Hyundai A-League of Soccer, the Socceroos and television
reality show The Biggest Loser. Famous sporting individuals such as Brett Lee, Tim Cahill and Torah
Bright and Stephanie Gilmour also sponsor Weet-Bix. These sponsors of Weet-Bix have not changed
for a long time and Brett Lee is still the face of Weet-Bix. Since all sponsorship of Weet-Bix is
revolved around sport it creates congruence in the consumers mind that Weet-bix and sport go hand in
hand. Their sponsorships have associated the Weet-bix cereal with the idea of healthy active
Australian lifestyles.
Product Placement: Just recently the Weet-Bix brand has joined into the product placement
promotional strategy. The brand is one of the first brands to sign up for a revolutionary style of
product placement of where a product is now digitally inserted into a program after the show is
produced. Weet-Bix signed up with channel 10 to utilise this product placement where there is to be
“a digitised Weet-Bix box set to appear in an episode of The Biggest Loser” (Kennedy, 2012). This is
a clever strategy by Weet-Bix as the product placement of their brand in a show that is based upon
eating healthy and losing weight effortlessly advertises and promotes the healthy option of Weet-Bix
without the viewers even being aware of it.
Sales Promotion: There are a few promotions occurring involving Weet-bix at the moment. One of the
promotions is an incentive promotion where kids receive a ten-dollar discount to their ‘tryathlon’
registration if they purchase two boxes of Weet-bix cereal. The second promotion that has just
recently finished was the opportunity to win a cricket experience with famous cricketer Brett Lee.
This promotion involved entrants writing a short message about their memorable cricket moment and
the winner was to receive tickets to the match day of cricket where they would spend the day with
Brett Lee himself. Both of these promotions gave Weet-Bix a strong marketing edge over the other
brands, as it was both a strong incentive to purchase Weet-Bix as it enticed kids who are interested in
sport and the promotion stayed true to Weet-Bix’s theme of active and healthy. It was a very directed
and focused promotion to a small target audience but was overall very effective.
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Recommendations
Weet-Bix already has strong marketing strategies in motion. Their large affiliation with sport has
helped them maintain a strong advantage over other cereal brands. There are a few issues in their
strategies that could be altered or fixed up. As stated earlier both Weet-Bix’s branding and
sponsorships have not changed for a long time. To stay relevant with the ever-changing market we
suggest a re-modernisation of Weet-Bix while keeping along with its core theme and message. All
consumers may not always like change but it is always effective at getting attention and bringing
excitement to a product. The packaging itself needs to be modernised with a bolder image on the box,
the colour scheme should stay the same so that consumers can easily recognise the brand but the word
“Weet-Bix” and the image on the box of Weet-bix should be more attention grabbing. Perhaps an
image of a child playing cricket, but instead of a cricket ball it could be replaced with Weet-Bix. This
would be more of an exciting image for kids to see on the box than the current image of two Weet-bix
in a bowl and it would stay relevant to the theme of “Healthy living” and their sponsored sport of
cricket. The logo of Weet-Bix could be changed slightly with simply using a different font.
The packaging and promotion of Weet-Bix could be used together. Weet-Bix could ask its consumers
what they like to add to their Weet-Bix or recipes they have created with Weet-Bix. This could be
done via Facebook, an online survey or even a promotional competition where the best recipe wins.
These ‘Weet-Bix recipes’ could then be added to the package on the back. There could even be a new
recipe on each new dispatch. This would involve the consumer and make them feel more apart of the
Weet-Bix product. Along with new promotions Weet-Bix should consider getting new sports sponsors.
Their main sponsor Brett Lee is getting old and is not as popular as he used to be. With new popular
cricketers rising each year Weet-Bix should contemplate choosing a new face for their product. There
is also the possibility of going in a new direction with not only a new face of Weet-Bix but sponsoring
a different or another sport along with cricket. For example soccer players such as Tim Cahill and the
Hyundai A League is already sponsored by Weet-Bix but is not promoted as highly as cricket. WeetBix could become the absolute dominant sporting choice of cereal if it sponsored not only cricket and
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soccer but also other sports such as netball, Afl or hockey. The company should also exploit
upcoming sporting events such as the World cup of soccer or the 2012 Olympics.
There are numerous promotional strategies that the Olympics could be utilised in. The box that WeetBix comes in could have a cut-out collectible Olympian card where each card has statistics and a
photo of an Australian athlete competing in the Olympics. Australian pride is at its highest when the
Olympic games are happening and everyone wants to support their Country’s athletes. So, Weet-Bix
should appeal to this by promoting the Olympics in not only their sales promotions but packaging and
also advertisements. They could bring in a special slogan to further emphasize that Weet-Bix is an allAustralian cereal company and their patronage towards the Australian Olympic team. It could be
something as simple as “Proud to be Australian”, and this simple reminder of patriotism will influence
other loyal Australians to purchase Weet-Bix.
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Conclusion
To conclude Weet-bix has a strong marketing strategy in action but could improve in certain areas.
Their pricing strategy has and currently still is working quite well and continues to offer good value
for money. Their packaging and branding are sufficient enough but could be improved and maybe
enhanced. Their distribution is very strong and they have penetrated the cereal market on great level
with intense exposure. As long as their product is in demand their distribution will continue to be
strong. The promotional strategy is where Weet-Bix has been strong in the past but has recently been
lacking. Since Weet-Bix is in its Maturity stage it needs to constantly stay relevant and promote its
product. If Weet-Bix becomes stronger in the promotional strategy it will stay the leader of the cereal
market.
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Reference list
-Capon, N. 2007. Capon’s Marketing Framework. Wessex Inc, New York
-Kennedy, J. 2012. Digital Weet-Bix box in The Biggest Loser. February 29th 2012
http://www.bandt.com.au/news/media/digital-weet-bix-inserted-in-the-biggest-loser, viewed on May
18th 2012.
-Kotler et. Al, 2008. Marketing 8th Australasian Edition, Pearson Publishing, Sydney
-“One Square Meal” (2011), Sanitarium, viewed on May 2012
http://www.sanitarium.com.au/products/on-the-go/one-square-meal
-Weetabix’Search for your share of £1m’ sales promotion, 2010, Utalk marketing.com, viewed on
May 16th
http://www.utalkmarketing.com/Pages/Article.aspx?ArticleID=18093&Title=Weetabix_‘Search_for_
your_share_of_£1m’_sales_promotion
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