Oreo sandwich cookie is available in over 100 countries all over the world. This favorite cookie is manufactured by Nabisco, a division of Mondelez International. While most consumers know Oreo sandwich cookie as two round chocolate biscuits with a vanilla crème filling in between, variations of the product can be seen in other countries. It demonstrates how Oreo adapts around the world and to the different tastes and preferences of local markets worldwide.
The brand enjoys robust sales in the United States and its global markets. Not one to rest on their laurels, the company continues to focus on foreign market growth, which is shown in the generated revenues from international markets that's more than double the U.S. sales.
According to Mondelez, the biggest markets of Oreo outside the United States are:
· The United Kingdom
· The Caribbean
· Central America
Just like other companies that ventured overseas, Oreo had its share of triumphs and losses. But it learned its lessons and now the company determines how far it will go to localize its brand.
A Bit of Oreo's History
The National Biscuit Company (Nabisco) was the developer of Oreo, which they called Oreo Biscuit. It started in 1912 and trademarked the same year. The product underwent
several name changes. It was renamed Oreo Sandwich in 1921 and became Oreo Chocolate Sandwich Cookie in 1948. It eventually settled for Oreo Chocolate Sandwich Cookie which was first used in 1974.
While it introduced new flavors for its filling, such as lemon crème, the only version that was retained is the original white crème filling. Oreo is also popular with vegans because no animal products were used to make its filling. The new formula for the crème filling was created by Sam Porcello, the main food scientist of Nabisco. He holds five patents for his work related to Oreo.
Oreo responds to trends, introducing online games such as the Double Stuf Racing League featuring sports celebrities. It also introduced limited edition cookies, such as the blue colored crème filling to promote the movie, Rio. The cookie pack included stickers and consumers completing the entire album of stickers won minor and major prizes. The promo ran for a year in Colombia, Peru and Ecuador.
The brand released several special advertisements, such as the Oreo sandwich filled with rainbow colored fillings to support the LGBT Pride Month in 2012. The series continued with a red, white and blue filling to commemorate Bastille Day, a trail of Oreo cookie crumbs simulating the Delta Aquariids meteor shower. For the Shark Week show on Discovery Channel, it ran a special advertisement showing an Oreo cookie with a jagged bite.
The brand maintains accounts on social media platforms. On Facebook alone it is followed by over 38 million people.
The worldwide acceptance of Oreo sandwich cookie is something that is worth knowing. Marketers could learn many things from the successes of Oreo's adaptation around the world. Through its foray into various foreign markets, the company developed many brand and marketing strategies that worked for them to maintain its dominance in the market and make Oreo a favorite of local customers. Its successes inspired several brands entering new foreign markets.
Oreo cookies were introduced by Mondelez to Latin and Central America in 1928. In 1948, the product was introduced to the Canadian market.
In most markets, the success of Oreo is ''from the filling'' so to speak. For the Mexican market, it has cocoa flavored cream filling with three types of chocolate combinations for
its wafers. For the Argentine consumers, it offers banana and dulce de leche cream filling. In Asia, several fruit-flavored fillings are available, such as raspberry, grape, peach, mango, orange and blueberry. It introduced chocolate and strawberry duo in Indonesia.
Developing the Chinese Market
Mondelez came up with different strategies to test market acceptance. For the Chinese consumers, the company introduced a wafer cookie in 2006. The move is to allow consumers to become familiar with the Oreo brand. In 2009, the company worked with a consumer panel in China to find out the right mix of bitterness, color and crunchiness that would appeal to local tastes. They found out that Chinese consumers want a cookie that is not too sweet and smaller.
A green tea flavored Oreo was introduced in China when the brand's sales lagged. The cooling sensation provided by the tea-flavored filling evokes the feeling of having ice cream.
Before Oreo became a household name in China, it suffered a few drawbacks. The brand entered the Chinese market in 1996. At that time, the company thought that using their tried and tested marketing formulas that worked in the United States would be applicable to the new market. At that time, the brand was still owned by Kraft. It was only after nearly a decade of low sales that they started changing their product and marketing tactics.
The company started to research why Oreo sandwich cookie was not hitting their sales target. From the data they found, they realized that Chinese consumers were not used to eating cookies. While the consumers liked the combination of sweet and bitter, the level of sweetness and bitterness of the cookie was not to their liking. Moreover, the cost-conscious Chinese customers found the cookie a bit expensive.
The company was willing to adapt to local consumers' preferences and they modified the recipe, reducing the sweetness of the cream filling and adding more chocolate to the cookies. They changed the packaging as well, introducing smaller packages that cost less.
Oreo immediately increased its sales with the changes that were introduced. The company then challenged the key attributes of their product, asking questions like why Oreo should be round and why the product is black and white.
Thus, in order to capture a bigger share of the market in China, the company introduced variations of Oreo that were different from the original appearance. They came up with
an Oreo with four tiers of crispy wafers. The filling consisted of chocolate-coated chocolate and vanilla cream. Newer variations include the double-fruit Oreo.
In the United States, consumers are very familiar with the Oreo ritual of twisting, licking and dunking the cookie in milk. But that tradition was not accepted in China. However, they saw that the local market was pushing for more milk consumption.
It was an opportunity for Oreo to come up with the campaign that proposed the pairing of milk with the Oreo cookie, which became a hit. Likewise, most of the advertising campaigns of Oreo in China focus on children, who are the center of all families in the country.
The company's willingness to change its original formulation, ingredients, product shape and packaging brought the company success in China. Continuous market research is a big help. When they found out that Chinese consumers loved to eat wafer cookies, they introduced the Oreo wafer stick. They introduced the chocolate-coated rectangle wafer filled with white crème. While it deviated from the traditional shape, it was a big hit among Chinese consumers because it was relevant to them.
Aside from vanilla and green tea ice cream flavors, Chinese consumers are delighted with the summer fruit combinations, such as the blueberry-raspberry crème filling and the orange-mango cream.
Entry Into the Indian Market
Oreo entered the Indian market armed with lessons they learned from China. Initially, the product was available through importation but sales were low because the consumers found the product pricey. Moreover, supply was limited and the awareness about the product was low.
However, localization strategies were implemented in 2007, which turned things around for the brand. Indian consumers were into biscuits, which was in stark contrast to Chinese consumers when Oreo first came into China. To conquer Indian consumers, brands have to focus on three things: strong distribution (since India is composed of many rural areas), high volume and competitive pricing.
During the time that Oreo was launched in India, the parent company has acquired Cadbury, which was a popular brand in India. Thus, they introduced the product as Cadbury Oreos. Their main strategy during the launch was to create awareness and encourage consumers to try the product. The brand was made sweeter to fit local consumers' palate and used Cadbury's retail stores for distribution. It retained the other features of the original product, but the "Made in India" on the label showed consumers
that most of the ingredients are sourced locally, which meant the price of the product would be lower.
The company also launched several activities to generate awareness and product trials, such as embarking on a product bus tour around several cities and smaller buses to go around hundreds of towns.
These are just two of the success stories of Oreo in different countries. These examples showed how research to gain local cultural knowledge and understanding the consumers and localization strategies to properly cater to local preferences were vital to business growth in the global market.
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