Start Up Blog

Wood chips, sugar & hazelnuts

Posted in entrepreneurship by Steve Sammartino on June 8, 2014

It was recently the 50th birthday of that favourite chocolate spread we sometimes convince ourselves is ok to eat between two piece of bread. Nutella.

Nutella Jar

What a lot of people don’t realise is that Nutella is what it is because they couldn’t afford to make it the way they wanted to. Originally Nutella was a pure chocolate spread, but during the post WW2 era, a time of heavy rationing in Italy, they bulked up the ingredients with hazelnuts. They did this because hazelnuts were plentiful in the local area and much cheaper than cocoa per kilogram. The presence of mind to turn to the woodchips, in this case hazelnuts, and remarket the brand was very clever indeed. The branding was adapted to talk up the nut credentials and make people believe it was actually a hazelnut spread.

In fact it only has 13% hazelnuts and a whopping 52% sugar by volume – ironically about the same amount as the white label on the jar. While I’ll leave the moral discussion on the marketing of Nutella for another blog post, the question it poses for all of us is this:

How do we turn necessary cost cuts or lack of availability of inputs into brand advantage?

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2 Responses

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  1. tomh77 said, on June 8, 2014 at 12:47 pm

    Great post Steve.

    I think this phenomenon is very much in effect with crowdfunding.

    People use crowdfunding as they don’t have the upfront capital required to get the product to market.

    But the very act of crowdfunding changes the business from being an old-fashioned buyer-seller relationship to a collaborative movement, in which the buyers become evangelists and even designers of the product, resulting in a better product and larger sales volumes than would’ve otherwise been possible.


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