Nestle

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Nestle

  1. 1. MARKETING PLAN: NESTLE MAGGI GROUP 5 1
  2. 2. Debjani Barua Tara Kiran Redkar Deepinder Singh Nash Ian Rodricks Sagar Bhisham Darira Sudipto Halder Advait Gautam Bhobe Suman Prakash INDEX1. Executive Summary 1 - Tara Redkar2. Situation Analysis 1 2
  3. 3. 2.1 Customers 1 - Tara Redkar 2.2 Competitors 1 - Sagar Darira 2.3 Company 2 - Tara Redkar 2.4 Context 2 - Tara Redkar3. Marketing Opportunities and Issues 3 - Sudipto Halder4. Objectives 4 - Nash Ian Rodricks5. Marketing Strategy 4 - Deepinder Singh6. Target Markets 5 - Deepinder Singh7. Positioning 6 - Debjani Barua8. Marketing Mix 6 - Advait Bhobe9. Review and Control 8 - Debjani Barua10. Marketing Organization 9 - Sagar Darira11. Contingency Plan 10 - Suman Prakash12. References 11 3
  4. 4. Marketing Plan: Nestle Maggi, India1. Executive Summary:Nestlé India is a subsidiary of Nestlé S.A. of Switzerland headed by Peter Brabeck-Letmathe, C h a i r m a n . Nestlé India is an effervescent Company that provides consumerswith products of global standards and is committed to long-term sustainable growth andshareholder satisfaction. The company is known for its brands in the Milk Products &Nutrition, Prepared Dishes, Cooking Aids, and Chocolates & Confectionery segments.Nestlé leads the value sales of noodles in India with a market share of 90%. Evidence toNestlés domination of sales of plain noodles is the fact that India accounts for the highestsales for the company for its instant noodles brand Maggi, among all its global offices. Withseven factories and a large number of co-packers, it has grown into India’s largest foodcompany. The biggest brand in Nestle’s portfolio is Maggi (it overtook Nescafe about tenyears ago).This marketing plan analyses the current marketing mix of Maggi Noodles and studies thepopularity of brand “Maggi” in India.2. Situation AnalysisWe are analysing the situation using 4C framework: customers, competitors, company andcontext 2.1 Customers India is the largest consumers of Maggi noodles in the world. It was launched in 1980 by Nestle group of companies. Initially when it was launched in India it was targeted towards wrong target group: working women. After conducting research they found out the biggest consumer segment was the kids. They shifted their focus to this segment by various tools of sales promotion like pencils, fun books etc also the ads of Maggi showcased a hungry kid saying “Mummy bhook lagi” to which the mother replies “Bas do minute”. The target group later on increased and included youth, office goers and health conscious people with income more than a lakh per annum. This group usually comes under middle class and upwards residing in urban, semi- urban and also rural areas. 4
  5. 5. 2.2 CompetitorsEven though it has been nearly three decades, the brand has not faced any seriouscompetition. Instead, in all these years, Maggi has grown exponentially to become ageneric brand, and has single-handedly taken the instant noodles category from beingalmost non-existent, to a Rs 1,200 cr. one, of which it currently has, as per industryestimates, a 90 per cent share, approximately.The competitors of Maggi are the Japan-based Nissin Groups Top Ramen, Nepalbased CG Foods Wai-Wai Noodles, ITC Sunfeast pasta noodles, Knorr SoupyNoodles, Big bazaar tasty treat and Horlicks Foodles. Main competitors are TopRamen and Sunfeast Pasta noodles. • Top Ramen Smoodles: Dont be a noodle, be a Smoodle was the advertisement that brought the Top Ramen brand into limelight when it was launched in 1991. Varieties: Packet Noodles: Macho Masala, Funky Chicken, Oye Tomato, Curry Smoodles, and Cup Noodles: Spicy Vegetable, Tangy Chicken. Distributor: Marico Industries USP: Dont be a noodle, be a Smoodle. • ITC Sunfeast Pasta: ITC launched Indias first instant pasta snack, Sunfeast Pasta Treat in 2005. Made from high protein Durum wheat, Sunfeast Pasta Treat is not fried and does not contain maida, making it a nutritious snack. This ready to cook pasta comes with a sauce maker inside the pack. Varieties: It is currently available in four exciting flavors: Masala, Tomato and Cheese, Sour Cream Onion and Cheese. Distributor: ITC Limited USP: Sunfeast is made from durum wheat and is promoted as a healthy alternative to instant noodles made from the less healthy maida (a type of wheat flour that is slightly lower in quality2.3 CompanyNestle was founded in 1866 by Henri Nestle. Nestle markets its products in 130countries & sells over a billion products each day. The main consideration of Nestle isGood Food, Good life to all consumers. Their priority is nutrition, health andwellness. Nestle India manufactures products of truly international quality underinternationally famous Brand names such as Nescafe, Cerelac, Maggi, Milky Bar,Milo, BarOne, Nestea and Kit Kat.For the full year 2011 Nestle India recorded net sales of Rs1, 351.8 crores. Nestle hasbeen a partner in Indias growth for the past 100 years and has built a very specialrelationship of trust and commitment with the people of India. 5
  6. 6. Nestle started the Brand Maggi in India around 25 years ago in 1983 with the launch of its traditional masala flavour followed by chicken and tomato flavours and curry flavour some years later. 2.4 Context Nestlé’s Maggi noodles is the top brand in the instant noodles segment of India which has grown to an estimated Rs200 crore & contributes to around 10% of Nestle India’s top line. Maggi has been the pioneer in this segment of market and hence got first mover’s advantage over other brands. There was a need for a product that would provide quality food and also was easy to cook. Nestle recognized this and introduced Maggi, a product which would take less time and to cook and consumer uses it to get fast relief from hunger. Maggi has regularly come up with new flavours and varieties to attract every segment of audience. It holds its position strong as a “good to eat, fast to cook” anytime snack. The Indian palate is not too adventurous in terms of trying out new flavours. In reality Maggi has settled at standard flavours such as curry, masala, tomato and chicken. People prefer to have it easily available and affordable.3. Market Opportunity and IssuesIndia being a country with huge population provides a huge market for any company. Maggiis no exception. Various opportunities that Maggi has in India can be summarized into thefollowing points.Rural India: Till very recent Maggi had concentrated only on the urban India. They nevertried to exploit the rural India which covers a major part of Indian population. Recently theyintroduced “Chhota Maggi” priced at Rs.5 for lower income group.Variety in taste: Their main drawback is that they rely heavily on one flavour only.Although they tried to produce products with different flavour they failed as Indians havesettled for traditional flavours. But having 85 % of the market share they can still easily takethe risk and try on various flavours but keeping the current flavours in market.Health: Their star product has no nutritional values and since children are the major target oftheir product they should come up with products that have nutrients. They have come up withMaggi Vegetable Atta noodles but more products should be launched.Population: India’s huge plus point is its population. Major part of the population is youth.Maggi can use the unemployed youth of India to increase their production which they can sellin rural India. 6
  7. 7. Schools: Various colleges have stalls where they sell Maggi. So schools should be theirmajor target where they can sell their product as Maggi being already popular among the kidsof India. This will solve the age old problem of the parents of preparing tiffin for the schoolgoing kids.4. ObjectivesMission: To be considered as the number one snacking option of India combining the valuesof convenience, taste and health.Nestle Maggi had the objective to raise their market share (Current market share is almost90%), promoting Maggi, and positioning themselves as healthy fast foods, and as per theconsumer feedback make changes in the product regarding packaging, ingredients, andspecial additives. Also launch new variants in the market. Maggi introduced “Pazzta” whichcomes in 2 flavours red and white sauce pasta, also launched Vegetable Multigrain noodles.The company continuously focuses its efforts to better understand the changing lifestyles andof modern India and anticipate consumer needs in order to provide convenience, taste,nutrition, and wellness through its products.5. Marketing Strategy • Conducting promotional campaigns in schools is one of their main marketing activities. • Advertising strategies: The focus of the advertisements is on the children as they are their major consumers. • Availability in different pack sizes: Packing is the biggest plus point of Maggi market penetration. They have the product available in all sizes to tap the categories of consumers. • There is a good innovation present in the products. Maggi 2 minutes noodles, Cup-o- Maggi, Atta noodles etc. are the different forms of the same product available in market. BCG Matrix 7
  8. 8. STARS QUESTION MARK - Maggi Veg Atta Noodles - Maggi Chicken - Maggi Pasta - Maggi Sauces CASH COW DOG - Maggi Masala Flavour - Maggi Tomato, Curry FlavoursMichael Porter’s Five Forces Model6. Target Markets 8
  9. 9. As per a market research it was concluded to target primarily the children as they liked the taste of Maggi noodles and were the largest consumers of the product. The market has been divided according to the following considerations: Demographics: 1. Region: Urban, semi-urban, rural (recent) 2. Occupation: Working professionals, self-employed, students 3. Social class: Middle class and upwards Behavioural: 1. Occasions: Regular and everyday user – Urban. Depending on the temporal aspects of consumer’s life(time of day, week, month and year) – Rural 2. Usage rate: Heavy user-urban, light-rural, medium-semi-urban7. PositioningInitially Nestle tried to position Maggi in the platform of convenience, targeting the workingwomen. But it found that sales were not picking up despite of heavy promotions. Researchthen showed that kids were the largest consumers of this brand. Realising this Nestle thenrepositioned this brand towards kids using sales promotions and smart advertising.Maggi has always positioned itself as healthy noodles – “Taste bhi health bhi” Through itsads. Nestle India Ltd. (NIL) positioned Maggi as a fun food for kids which mothers couldprepare easily. Taglines like Mummy, bhookh lagi hai (Mom, Im hungry), Bas 2-Minute,and Fast to Cook Good to Eat effectively communicated the products benefits to targetconsumers. These ads had become so popular that the tagline Bas 2-Minute immediatelyreminded Indian consumers of Maggi noodles even several years after the ads were taken offthe TV.To prevent its top competitor, Top Ramen from hampering its market share some innovationswere required. It also had to deal with the negative perception of Maggi being unhealthy inthis health conscious market. This is the reason “Maggi Veg Atta Noodles”, “Maggi Dal AttaNoodles” were introduced.“Cup-O-Maggi” was introduced to target customers who values time, convenience as well asnutrition. Added advantage of Cup-O-Maggi is no need of cleaning plates and lesser timerequired for preparation. Its appeal is “Healthy Snack Anywhere, Anytime.”Market position of Maggi: 1. Leads in instant noodles and sauces. 9
  10. 10. 2. Stands second in healthy soups. 3. Market share of noodles- 90% 4. Current sales- sales- 2154.5crore (FY11) in India.8. Marketing mixProduct: Maggi has come up with various products according to the needs of consumers.Some of them became very popular and some of them were total failure. The products thatpassed the test of time are as follows: • Maggi 2-Minute Noodles is one of the largest & most loved snack food brand that defines the Instant Noodles category in India. It is now available in 5 flavours: Masala, Chicken, Tricky Tomato, and Thrilling Curry & Romantic Capsicum. • Maggi Vegetable Multigrainz Noodles is a product which is a source of Protein, Calcium and Fibre, and has added vegetables. The inspiration for the product comes from the growing consumer preference for a healthier lifestyle. • Maggi Vegetable Atta Noodles is healthy because it is made of wheat flour and has more real vegetables and is packed with the power of fibres. • Maggi Cuppa Mania is a combination of all the above. It’s an easy to carry on-the-go Cup format, Maggi Cuppa Mania comes in two variants – Masala Yo! And Chilly Chow Yo.Packaging: Maggi is packed in the yellow packets. The tip of the packet is zipped so that thecontents can easily be spilled without wasting it. It has solved the problem of storage. Thethickness of packets is increased so that the contents can be easily poured without muchwastage.Promotion: Over the years Maggi became an integral part of the Indian household like otherFMCGs like Coke or Pepsi. TV commercials played an important part in it. Elements thathave stayed constant in any Maggi film include the jingle -- ‘Maggi, Maggi, Maggi’ in a sing-song voice, the family setting, and the ‘two minutes’ promise, which started off as a USP, buttook a backseat eventually. Maggi has generally stayed away from taking the celebrityendorsement route. All the ads for the brand usually focus on the mother-child relationship.“The mother and child are the celebrities for Maggi”.Other innovative ads like the Maggi voiceover campaign which is a collection of shortvignettes, showcasing consumers’ memories of Maggi just brought Maggi closer to the heartof India. As a part of its promotional drive, Maggi has launched a website, meandmeri.in,where consumers can upload their Maggi moments and submit their favourite Maggi recipe.Consumers, whose stories or recipes are a hit with the company, will get a chance to be 10
  11. 11. featured on Maggi packs or ads. Apart from the TV commercials they promoted the productby 1. Distributing free samples. 2. Giving gifts on return of empty packets. 3. Dry sampling-distributing Maggi packets 4. Wet sampling - distributing cooked Maggi. 5. Availability in different packages 50gm,100gm,200gm,etc.. and 6. Effective Tagline Communication.Place: Nestle Maggi Noodles is famous not only in urban areas but also in rural areas. It isrightly available at number of retail shops and malls so that consumers can easily purchasethe product without much efforts.9. Review and ControlFor review the revenue and sales, and consumer feedback is taken into consideration.Revenue and Sales:Maggi is NIL’s largest brand (Nescafe was the largest until mid-1990’s) withsales (gross) of2154.5 crore (FY11). It includes the sales of instant noodles and pasta cooking aids, soupsand sauces. Enjoying virtual monopoly in the segment until FY10, NIL revenues from thesegment have grown at a CAGR of 26.3% (CY04-11) backed by volume growth of 20.5%and price growth of 4.8%. Expected growth (CAGR CY11-13E) of Maggi is 20.5% (volumegrowth of 17%).Consumer Feedback: 11
  12. 12. 10. Marketing OrganizationOrganizational structure is the formal framework by which jobs tasks are divided, grouped,and coordinated. Nestlé Maggi is a function-based organization. The tasks are divided intoseparate jobs and then these jobs are grouped together under different departments i.e.functional departmentalization is found in organization. Each major area is kept under themanager who is specialist in that concerned field and is responsible for all activities, whichthat department performsOrganizational structure of Nestle Maggi is hierarchical. 12
  13. 13. There is a chain of command that extends from upper organization levels to the lowest levelsand clarifies who reports to whom. The orders move from upward to downward andsuggestions move downward to upward direction. The continuous improvement section ismade for this purpose. It encourages employees to give their suggestions and share the newideas. The jobs are formalized; there are explicit job descriptions, numerous organizationalrules, and clearly defined procedures covering work procedures. But in spite of formal rulesand regulations, Nestlé keeps on changing to keep a pace with the changing environment. So,it is strict but not rigid organization. In effort to be more flexible and responsive, there hasbeen distinct trend in this organization toward decentralizing decision-making.11. Contingency PlanContingency theory is a behavioral theory that claims that there is no single best way todesign organizational structures. The best way of organizing e.g. a company, is, however,contingent upon the internal and external situation of the company.The point is to design an organizational structure that can handle uncertainties in theenvironment effectively and efficiently.Some important contingencies for companies are listed below: 13
  14. 14. 1. Technology2. Suppliers and distributors3. Consumer interest groups4. Customers and competitors5. Government6. UnionsFor instance, when Top Ramen brand of instant noodles entered the market with the slogan“Don’t be a noodle, be a smoodle”, it was the next best thing to say but after all marketleaders maggi noodles had appropriated the convenience aspect of instant noodles through acombination of clever sub branding of ‘2 minute noodles’, and well-pitched advertising withthe new slogan of “ bhook lagi…bas do minute”, to upbeat its competitor Top ramen.Furthermore, when it comes to consumers then Maggi conducts test marketing beforelaunching new product distinctive from its competitors and strengthens its distributionchannels in the rural areas. In addition, it conducts market research to find out the marketpenetration of the product in the rural area covered.So, from the above we can say that Maggi diversifies its products and its noodles not only toone geographical constraint but to many different areas according to the demand of theconsumers.Moreover, Maggi in Gujarat had to face a lot of problems because it was unaware that thepeople of Gujarat do not eat garlic and onions so Maggi designed its product according to thepeople of that place which is devoid of garlic and onions and named it as ‘Jain Maggi’. Sofrom this we can see that Maggi makes or design it brands now according to the taste andpreferences of the consumers.12. References • http://www.nestle.in/brands/pdca/Pages/PreparedDishesAndCookingAids.aspx • http://en.wikipedia.org/wiki/Maggi • http://www.maggi.in/range.aspx • http://articles.economictimes.indiatimes.com/2010-08-30/news/27597085_1_noodles- maggi-hul-and-gsk 14
  15. 15. • Casestudy.co.in/wp-content/…/Maggi-Brand-in-India-Case-Study.doc• http://www.business-standard.com/india/news/smart-marketing-competitive- pricing-/468400/ 15

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