Nestlé is being innovative in the promotion of Kit Kat in Japan, with new and novel flavours being introduced alongside novel marketing campaigns. just-food’s Gavin Blair spoke to Yuji Takeuchi, Kit Kat brand manager at Nestlé Japan, to discover some of his marketing sophistry.

just-food: Could you give a little background or history of the various Kit Kat flavours that have been produced in Japan?

Yuji Takeuchi: The milk chocolate Kit Kat, with the standard red package, is sold in 70 countries around the world, including Japan. However, there are a number of product lines sold only in Japan, and they can be roughly divided into two categories.

The [recently-launched] ‘Kit Kat local souvenir series’ is one of the product lines. A total of 20 different kinds of Kit Kat are sold as souvenirs for tourists in various places including railway stations, airports, and expressway service area shops throughout Japan.

The other lines of products are the ‘limited-period products’ or ‘limited-edition products’ that are sold at supermarkets and convenience stores throughout Japan: these products are intended for routine daily consumption.

There are a great variety of flavours offered in Japan. These began with Kit Kat strawberry, which was sold as a limited-period product for the first time in 2000. The scope of the product concept has been expanded and has evolved ever since, so as to include [additional flavours, such as] the fruit concept, the dessert concept, and the traditional Japanese flavours concept.

just-food: Which flavours have been well received? 

Takeuchi: Among the products in the Kit Kat local souvenir series, Zunda (mashed green soybean) and Shoyu (soy sauce) have proved to be particularly popular with customers. Among the limited-edition products that are sold throughout the country, strawberry still enjoys many devoted followers

just-food: How was the 'localising' of the range and using new flavours planned for the Japanese market? 

Takeuchi: We started offering the Kit Kat local souvenir series three years ago - with the aim of exploring new sales channels, [finding] new consumers, and new [times and places for] consumption…because sales at convenience stores and supermarkets had reached saturation point.

just-food: If this strategy of local flavours in Japan started three years ago, why has Nestle accelerated this now? Were Kit Kat sales in Japan stagnating?

Takeuchi: We did it because, as we had expected, we thought there should be many more sales opportunities like those mentioned above. [We thought] they could be more advantageous from the viewpoint of brand communication within a non-routine space like tourist destinations. Unfortunately, we have been having a hard time increasing sales in [Japan’s northern island of] Hokkaido where powerful [rival] souvenir brands abound.

just-food: Has Nestle sold more regular Kit Kat since the launch of the regional flavours?

Takeuchi: I am sorry, but we can’t disclose figures for the total sales of Kit Kat. However, I can share with you the fact that [regarding sales during] the annual Juken examinations campaign between January and March, the sales today for the campaign period are up by 50% compared to 2002, the year before the campaign began.

just-food: How do Nestlé’s marketing strategies for Kit Kat (and other chocolate brands) differ to its competitors in Japan?

Takeuchi: The major difference, we believe, lies in collaborating with people outside the company and carrying out marketing activities that concentrate on PR activities. We have mainly publicised Kit Kat through the utilisation of media public relations, for example, articles in newspapers or TV reports. So, the only time we’ve run TV commercials for Kit Kat has been in January, just prior to the Juken [school and university entrance exam] season.

just-food: There have been other successful Kit Kat marketing campaigns, for instance ‘Kitto Katsu’ – a play on the Japanese words for ‘definitely win’ and ‘succeed’. These lines were promoted as a present for students to take with them to their examinations. Why have so many innovative marketing campaigns been introduced for Kit Kat in Japan?

Takeuchi: Our success is probably attributable to the fact that the marketing section of Nestlé Japan, the outside advertising and PR agencies that we work with, and affiliated companies, are united as a team, which helps promote the creation of fresh, new ideas.

just-food: What has been the impact on Nestlé Japan's production costs of food inflation? Have your ingredients costs risen? 

Takeuchi: Please excuse me from making any comment on that subject.

just-food: What has been the impact on the shelf price of Kit Kat?

Takeuchi: We have sometimes modified the sales price in the past, for instance by setting the suggested retail price at [Japanese Yen] JPY126 (US$1.36) for Kit Kat original, but the price is now fixed at JPY105 (US$1.13).

just-food: These are limited-edition flavours but will Nestlé persist with this strategy (local flavours for different regions in Japan) and could it be extended to other products?

Takeuchi: Because I am the Kit Kat brand manager in Japan, I can answer only about Kat Kat. Actually, at this point, we don't have any plans for other highly localised products like the souvenir Kit Kat, although localisation is a key part of Nestlé's strategy. I think the policy is especially suited for the marketing strategy of souvenir Kit Kat.

just-food: Has there been much interest from Nestlé and Kit Kat managers in other countries in the successful Japanese campaigns, and are there any plans to try and implement local versions elsewhere?

Takeuchi: The situation of Kat Kat in Japan is described on the global Intranet used within Nestlé. Regarding the marketing activities in other countries, each local subsidiary is responsible for making its own suitable judgments, so I am not in a position to make any comments on that subject.