Nestle juices-project

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Nestle juices-project

  1. 1. BRAND AUDIT STRATEGY BRAND MANAGEMENTBrand Audit 1 Nestle juices
  2. 2. TABLE OF CONTENTS No. Particulars Page 1 Executive summary 3 2 History and Introduction 4 3 Mission and vision 10 4 Value chain Analysis 12 5 Pest analysis 19 6 Market analysis 22 7 Competitor analysis 24 8 Swot analysis of nestle juice 27 9 Porter five model 30 10 Analysis of buying behavior 33 11 Hierarchy of goals 35 12 Marketing segmentation 35 13 Positioning 36 14 Product strategy 37 15 Communication strategy 38 16 Budget 40 17 Distribution strategy 41 18 Price strategy 42 19 Sale forecast 47Brand Audit 2 Nestle juices
  3. 3. Executive summary Nestle foods was established in 1866. Since then it has continued to providequality products to its customers with products and packaging innovations. Nestlejuices is Pakistan¶s number one and fastest growing food company. The company istrying their level best to differentiate themselves from other local companies andtrying to win the competition in juice industry by adopting the modern trends andtechnologies in both operational fields as well as in marketing of their products.In this detailed project we covered all most all the topics related to the marketingplan. First of all we presented the companies¶ history and introduction whichincluded the year of formation and certain steps the resulted in the today¶s form ofNestle. We describes value chain analysis PEST analysis about nestle juices andour brand competitor .And the next step we do experiment about SWOT analysiswho its effect on our brand .so we described MARKET analysis, competitoranalysis, analysis buyer behavior , hierarchy of organization goals and the next stepto STP of nestle company ,so we explain product strategy , price strategy anddistribution strategy ,communication strategy and other things related to amarketing plan such as marketing budget and last of our project sale forecast forlast 5 year.. Innovative technology, , Globalization, Matrices, , Financial Review,Porter¶s five model, Industrial analysis, Five Ws and Future Plans Of Company.Brand Audit 3 Nestle juices
  4. 4. SITUATION ANALYSISBrand Audit 4 Nestle juices
  5. 5. INTRODUCTION AND HISTORY OF COMPANYHistoryIn the 1860s Henri Nestlé, a pharmacist, developed a food for babies who wereunable to breastfeed. His first success was a premature infant who could not toleratehis mothers milk or any of the usual substitutes. People quickly recognized the valueof the new product, after Nestlés new formula saved the childs life, and soon, FarineLactée Henri Nestlé was being sold in much of Europe.1905-1918In 1905 Nestlé merged with the Anglo-Swiss Condensed Milk Company. By theearly 1900s, the company was operating factories in the United States, Britain,Germany and Spain. World War I created new demand for dairy products in the formof government contracts. By the end of the war, Nestlés production had more thandoubled.1918 -1938After the war Government contracts dried up and consumers switched back to freshmilk. However, Nestlés management responded quickly, streamlining operations andreducing debt. The 1920s saw Nestlés first expansion into new products, withchocolate the Companys second most important activity1938 -1944Nestlé felt the effects of World War II immediately. Profits dropped from $20million in 1938 to $6 million in 1939. Factories were established in developingcountries, particularly Latin America. Ironically, the war helped with theintroduction of the Companys newest product, Nescafé, which was a staple drink ofthe US military. Nestlés production and sales rose in the wartime economy.1944 -1975Brand Audit 5 Nestle juices
  6. 6. The end of World War II was the beginning of a dynamic phase for Nestlé. Growthaccelerated and companies were acquired. In 1947 came the merger with Maggiseasonings and soups. Crosse & Blackwell followed in 1960, as did Findus (1963),Libbys (1971) and Stouffers (1973). Diversification came with a shareholding inLOréal in 1974.1975 -1981Nestlés growth in the developing world partially offset a slowdown in theCompanys traditional markets. Nestlé made its second venture outside the foodindustry by acquiring Alcon Laboratories Inc..1981 -1996Nestlé divested a number of businesses1980 / 1984. In 1984, Nestlés improvedbottom line allowed the Company to launch a new round of acquisitions, the mostimportant being American food giant Carn tion.1996+The first half of the 1990s proved to be favorable for Nestlé: trade barriers crumbledand world markets developed into more or less integrated trading areas. Since 1996there have been acquisitions including San Pellegrino (1997), Spillers Petfoods(1998) and Ralston Purina (2002). There were two major acquisitions in NorthAmerica, both in 2002: in July, Nestlé merged its U.S. ice cream business intoDreyers, and in August, a USD 2.6bn acquisition was announced of Chef America,Inc.Nestle Today:Today, after 142 years it was first used, the nest continues to be the corporateIdentity of Nestle as the worlds leading Food Company and remains the symbol ofquality. Nestle, the symbol of quality and commitment in the field of food products.Nestle is the world No.1 food company. It is the 5th largest company in the worldaccording to its turnover. It is present on all five continents, has an annual turn-overof 70 billion Swiss francs, runs 522 factories in 81 countries, 200 operatingcompanies, 1 basic re- search center and 20 technological development groups andmore than 231,000 employees the world over.Brand Audit 6 Nestle juices
  7. 7. The Company owes its current status to the pioneering spirit inherited from itsfounders which continues to inspire it, to its concern with quality and to its constantsearch for new ways of satisfying mans nutritional needs. Wherever possible, it setsup factories locally, employs personnel from the country concerned and relies onindigenous raw materials.Its agricultural services provide assistance to improve the quality and yield of theraw materials it uses. Much attention is de- voted to professional training and to theintegration of the company in its economic and social environment.History of Nestle juicesA well-known brand, FROST was introduced in 1986 and has the largest share of thecountrywide market. Positioned as a cold drink and alternate to cola drinks, itsstrength lies in the convenience attached to its usage.NESTLE JUICESEncouraged by the consumer response to NESTLE ORANGE JUICE that waslaunched in 1996, the category of NESTLE juices was expanded with theintroduction of Mango-Orange and Mango flavors in the year 2000. This has furtherstrengthened the position of Nestle as leader in the value added/premium drinksmarket. Consumer response to these new flavors has been very upbeat and isexpected to gain further. Now nestle company have launch following juice brand inPakistan.Indulge in the pure pleasures of a healthy life!Nestlé brings you a range of juices that will scintillate yourtaste-buds and add variety to suit every moment.NESTLÉ® Pure Orange JuiceOranges are in demand not only for their divine juicy flavorbut equally celebrated for their health benefits. They arenaturally low in calories, and an excellent source of Fiberand Vitamin C.Squeezed from the finest handpicked oranges, 100% pure NESTLE® Pure OrangeJuice has no added sugar and is a good source of Vitamin C. Having Orange juiceBrand Audit 7 Nestle juices
  8. 8. everyday is a great way of strengthening the body resistance against infections anddiseases and maintaining a healthy lifestyle.NESTLÉ® Clear Apple NectarApples have no fat and are cholesterol free. NESTLE® ClearApple Nectar is made from the finest Apples and is 100%clear.As irresistible as sin itself ± give in to the amber kick of NESTLE® Clear AppleNectar.NESTLÉ® Red Grape NectarGrapes also called the µqueen of fruits¶ are known for theirgreat internal body cleansing properties. They are a good sourceof Vitamin C and Potassium that plays an important role inproper heart functioning by regulating blood pressure and heartbeat.Relish the full-bodied, smooth flavor of NESTLÉ® Red Grapes Nectar and let yourtaste buds soak in the sensuous richness of Red Grapes.NESTLÉ® Pineapple NectarPineapples are good source of Vitamin C, an antioxidant that helpsfight against free radicals, one of the main reasons for aging.Made from premium pineapples, NESTLÉ® Pineapple Nectarbrings you the exotic taste of pineapples with a refreshing tropical flavor and is agood source of Vitamin C.Brand Audit 8 Nestle juices
  9. 9. NESTLÉ® Mango OrangeSink into Fruity RefreshmentFeel the burst of fruity fun and discover the flavors ofNESTLÉ® Mango & NESTLÉ® Mango Orange fruitdrink made with the juiciest, sweetest Mangos andracy, sharp Oranges to sass up your taste buds.NESTLÉ® Chaunsa NectarNestle Chaunsa Nectar is prepared from the finest quality Chaunsa mangoes that areprocured from the best fruit farms. The 100% rich mango nectar is nutritious,refreshing and wonderfully delicious. It helps to replenish the lost vigor duringworkouts and enhances your fitness by providing fortified energy endowed withdietary fiber, Vitamin A, C & E.NESTLÉ® Guava NectarA chilled glass of pink Nestle Guava Nectar is not only great tasting but is alsowholesome in antioxidants making it very nutritious.Nestle Guava Nectar is rich in Vitamin A, Vitamin B, Vitamin C and Niacin and dueto excessive fiber content it is an effective fat burner.Brand Audit 9 Nestle juices
  10. 10. NESTLÉ® MangoFeel the burst of fruity fun and discover Nestle Mango fruit drink made with thejuiciest, sweetest mangos to sass up your taste buds.Now that is a sweet deal!!Brand Audit 10 Nestle juices
  11. 11. Mission statement ³Good food good life´Build Branded food business to improve quality of life by offering tasty, affordableand highly nutritional products to our consumers while maximizing stake holdersvalue´ VISIONExplore all over the worlds-from baker to babies, parents to pet ownerssingle servings to catering: providing for all their needs always with theassurance of outstanding quality.Brand Audit 11 Nestle juices
  12. 12. VALU CHAIN ANALYSIS Rso rc s e ue Mngmn aae et Rsp n ility e o sib Dc mn tio ou e ta n e P dc Nw rout n rin up Esu gSp ly Dvlomn & In dc n e e p e t troutioCn mr o su e as Sle Cn mr o su e o s mr Cnu eDmn e ad S ics erv e & rout se P dcU Stisfa tio a cn Cn u u o tin o s Min in g a ta in Imro e e t p vmn & Ma re e t e su mn Mngmn aae et Crre tiv oce Ad u it Atio cn Rv wQa e ie ulity Our selected brand is nestle orange juice, to analyze the specific activities through which firms can create a competitive advantage; it is useful to model the firm as a Brand Audit 12 Nestle juices
  13. 13. chain of value creating activities. Michael porter identified a set of interrelatedgeneric activities common to a wide range of firms. The resulting model is known asthe value chain and is depicted below.Primary activitiesInbound Operation Outbound Marketing Servicelogistics logistics & SalesInbound logisticsMajor raw materials of nestle orange juices are different pulps of orange such fromGermany and France. Nestle company is being getting there raw material from localmarket in the Pakistan. Nestle juices included their ingredient such as fresh fruitnectar of mango, apple, pineapple, orange, included their fresh juices.Nestle imported all machinery and formulas who is the advantage of nestle company.OperationPRODUCTION PROCESSFruit juice production procedures involved in fruit juice manufacturing depending onWhat type of the juice the unit is going to make. For the purpose of this -feasibility,we propose the 4% token juice drink of Citrus fruit (Orange), Mango and pineapple.Fruit Juice - Production Process FlowProduction of fruit juices is a standardized process and initial preparatory processesfor all fruits will be similar, as will be the last stages of juice/pasteurization sectionand packaging, although differences in handling juice composition arise in certaincases due to the nature of the fruit and percentage of vitamin involved. Basically,preparation process of juices involves the following steps:- y Boiling of fruit y Storage in Tank y Ingredients mixing y Syrup Storage in Tank y Juice PreparationBrand Audit 13 Nestle juices
  14. 14. y Juice Storage Tank y Filling and Packaging y Cooling and StorageIn the following pages the process flowchart and brief description of the variousProcesses involved in fruit juice production are outlined.Fruit Juice Production ProcessFruits boiler where it is cooked and shifted to the plate heat exchanger. Then storedin the storage tank. Then supplied to the mixing tank in the desired quantity while inmixing tanks; any additives to the are made at this stage before it is pumped to syrupstorage tanks. Blended juice is then pumped through pasteurizer; where it is heatedto 90oC to inactivate enzymes and living organism. After pasteurization the juicepasses through final filtration, before loading it into a juice storage tank. Juice fromthe tank is ready for packagingPacking and labeling then storage.The juice will be then packed in the quantities demanded by the market. Consumerpacks as like 200ml and 1000ml tetra pack and then label the nestle juices. Productwill be in cool dry store.Brand Audit 14 Nestle juices
  15. 15. Brand Audit 15 Nestle juices
  16. 16. Out bound logisticIn Nestle Company the activities that include in outbound logistics are, they establishtheir sale and distributive offices in big cities like Karachi, Lahore, Islamabad, Faisalbad, Gujranwala etc. and also hire suitable distributors on agreed profit margins.Who bought from nestle office of the city and try to distribute to the each retailersand shop keeper in the city.ServicesCompany established the customer center in each office in a city. And also given tollfree number as a help line number which means that if customers feel any problemthen they can contact through our help line.Marketing and saleNestle company launch their sale promotion scheme after six months and their lastsale promotion was ³ µ¶. This was for a retail shop who put the nestle juicesbillboard on their shop or sale reception table then they can win attractive prizes. Bythis operation they can save all the advertisement expenses which they have to pay tothe retailer or owner of the shop.Nestle company use advertisement channels when company have to launch newbrand or improvement in previous brand. So company prefer to use Jeo, ARY oneworld, PTV home, I vision and news papers. They contract with the advertisementchannels for 1 to 2 months and repeat 2 or 3 time in a day.They hire suitable distributors in a country at agreed profit margins who boughtjuices in bulk form from the distributive channels and then sell to the retailer whofinal sale to the end consumers.Nestle company has efficient market management who¶s main objectives formarketing their product are y Strong customer relationship y Identify need of customer like new taste new fruit item y Maintain market leadership by maintaining the pure quality y Provide juices which are fit for human bodyBrand Audit 16 Nestle juices
  17. 17. y Stop brand selling don¶t reduce quality y Quality is our granteeSupportive activitiesThe primary value chain activities described above are facilitated by supportactivates. Porter identified four generic categories of support activities, the details ofwhich are industry specific.COMPANY STRUCTURENestlé head-office in Pakistan is in Lahore. It also has its registered office in Lahore.Nestlé has divided the whole Pakistan in to three zones.y Northern Zoney Central Zoney Southern ZoneNestlé has 8 regional offices in all over the Pakistan. These offices work under theirrespective zonal offices.FACTORIESNestlé has two factories in Pakistan for the production of Juices items.One in Sheikhupura near Lahore.LOCATION OF FACTORIESNow we give some information about the company¶s factories of the company. FACTORIES Sheikhupura Factory Kabirwala Factory 29th Kilometers on Khanewal Road, Distt. Lahore Sheikhupura road Kabirwala. Sheikhupura. Ph. 0692-53168-69 Ph. 92-42-6369321-26Brand Audit 17 Nestle juices
  18. 18. TechnologyThey used Tetra Recart restorable carton in juice packing. The easy-open carton wasmore convenient and positioned the tetra packing juices as a premium product.High tech ½ fat juices, France. Technology used to increase flavor and decrease thefat in juices.Plant capacity ± About 75000 kg per day fruit juice concentrate of orange andpassion fruit.Plant equipment- Infeed fruit conveyor, fruit washer, fruit mill, screw pre heater,hydraulic press, press filter, aerator, tubular/ plate sterilized/ pasteurizer, jacketedstorage tank and filling machine.Plant and Equipment The main plant and equipment will be for following activities Fruit handling & Inspection/ washing Juice extraction Reception Juice processing Juice finishing Centrifugation Homogenization Membrane filtration Pasteurization De-aeration Concentration Essence recovery Concentrate post- Aseptic or non- treatment aseptic packagingBrand Audit 18 Nestle juices
  19. 19. PEST Analysis Political or legal forcesTaxation LawIf government imposes heavy taxes on the industry then it badly effects the industrygrowth. The taxes impose is from government side and it varies from industry toindustry. Juices have no tax except sales tax. But nestle¶s some product has likebutter and cream which has more taxesLabor LawsLabor is being privileged here having all the laws. Nestle company also follow theselaw like government announce minimum salaries of a employ Rs 6000.Laws on hiring & promotionsHiring & promotion is followed by law. People with better capabilities are privilegedbecause they deserve it, for the betterment of the organization. As well as a welleducated & skilled experienced person is a precious asset for the company suitshould be hired on better term & conditions and be promoted on the basis of itcapabilities.Environmental protection LawsThey do concern for environment and contribute more and more for the bettermentof environment.Foreign trade RegulationsForeign trade regulation does not effect the over all policy and the working of the³Nestle juices´ because they operate nationally not internationally.Attitudes towards foreign companiesThey have no any agreement with any foreign company but if any company willoffer the business to them related / unrelated they would think about it according toterms and conditions.Political instabilityThe government stability also plays a great role for any industry. In Pakistan governmentface lot of difficulty from the side of terrorism and also its activity that badly effectBrand Audit 19 Nestle juices
  20. 20. environment of the country which is totally very upset. Recently in Punjab instability ofgovernment creates lot of problem for the industry like shortage of electricity that badlyaffects the industry operational process. Nestle juices have not much affect this condition butin future it may be face some difficulty for operating. Economic forcesInflation Rate:Now in Pakistan inflation rate is almost 22.3% so if increase in inflation rate thenincrease in prices of Nestle JUICES but if in Pakistan economy.Economic growth rateEconomy growth rate accelerate is 7+ Social factorHealth consciousnessToday people are more health conscious so Nestle juices by identifying this need ofthe people they are also producing health conscious juices with more vitamins.Demographic trendIn Pakistan the population growth rate is 1.828% in 2008 and total population is167,762,040 (July 2008 est)Age structure y 0-14 years: 40% (male 33,293,428; female 31,434,314) y 15-64 years: 56.9% (male 48,214,298; female 46,062,933) y 65 years and over 4.1% (male 3,256,065; female 3,542,522)Key Indicators y Population: 164,741,942 (July 2007 est.) y Growth rate: 1.828% (2007 est.) y Birth rate: 27.74 births/1,000 population (2007 est.) y Death rate: 8 deaths/1,000 population (2007 est.)Brand Audit 20 Nestle juices
  21. 21. Environmental concerns:About the environmental concerns of Nestle juices is good health.Work life quality:Quality of work life is very safer & environment friendlyLifestyle changes:They consider quality life changes and take advantages of accordingly so thatcustomer can convinced as well as it plays a vital role to attain & retain the customer.Consumer adopts the trend of changing environment because of modern facility aswell as globalization they are aware about each and every thing happening all aroundthem. Technological forcesNew ProductsNestle juices focusing concentric and conglomerate diversification because inpresent era it is not possible for any organization to exist in market for long run byproviding just one product. So Nestle juices are diversifying according to changingdemand of customers and trends.Product innovationProduct innovation is becoming more necessary for the organization because ofglobalization people are becoming aware about the changes being taken place aroundthem so in order tactical the situation nestle juices is focusing on product innovationby introducing new flavor of juices with the passage of time NESTLE JUICES usenew tetra packing like easy open cork of pack.Productivity improvement through automationAutomation don¶t matter a lot but to some extent it contribute towards productivityand improvement. Imported pulp is filled in machines for processing after the finalform of juice it is packed in 250 and 1 liter packing.Brand Audit 21 Nestle juices
  22. 22. Total spending on R&DSpending on R&D is long term investment for any organization. Nestle has R&Ddepartment and head of R&D department is Mr Arshad Bhati. Nestle total spendingon R&D 70 millions.New communication technologyAll the modern as well as traditional ways of communication are being adopted byNestle juices including own emails, letters, faxes and monthly visit in differentoffices of Nestle juices for better communication among supplier, distributor andcustomers.Nestle juices has also established own web site which can be visited any one formost recent news innovation and activities being taken in the organization. Market analysisCurrently in Pakistan, there are 24 fruit juice/pulp processing units and a number ofsmall units in the informal sector are working. The present installed capacity isestimated around 400,000 metric tons per annum with a demand for juices growingat a combined annual growth rate of 27%. The fruit juice industry reported sales of8.526 billion Rupees in year 2008. 250 200 150 Eas Column 2 100 Column 3 50 0 2001 2002 2003 2004 2005 2006 2007 2008 y The outlook for the canned food industry - which can exploit rising demand for convenience and consumer fears over food origin and hygiene - and the soft drinks and beverages industry - which can capitalize on the asp rationalBrand Audit 22 Nestle juices
  23. 23. demands of Pakistans young population - have both been moderately accelerated. Forecast canned food sales growth to 2012 now stands at 46.7%, while soft drinks sales growth to 2012 is forecast to stand at 36.4%. Both have contributed to a per capita food consumption growth forecast amendment to 15.4%. It is also expected that the average consumption of the single person will be 85.5 hundred litters per years in 2012. y 2500,000 liters juices approx drink by Pakistani people in a month. And per day there is 83330 liters approx juices drink by people. y The market of juices is growing because the consumption of juices increases every year and expected it increase continually due people change the life style and more health conscious. They prefer juices on other soft drink. y The market share of the nestle juices is 60%. Which mean 1500,000 litters in a month and 50,000 litters in a day. y Nestle is name of pure life so quality is their guarantee. So if they lose their quality then they lose their sale because these don¶t operate on the given image. And increase in rates of raw materials also influence the level of demand because due to increase in cost the sale price also increase and due to price war in a market of Pakistan demand level is effected. Or increase in tax there will be increased cost price which also effect in decreased in demand. Increase in inflation rate in Pakistan then this also effect in decrease in demand level. y The nestle juices are at growing stage of product life cycle.Brand Audit 23 Nestle juices
  24. 24. Competitor¶s analysisCompetitor analysis in marketing and strategically management is an assessment ofthe strengths and weaknesses of current and potential competitors. This analysisprovides both an offensive and defensive strategic context through which to identifyopportunities and threats. Competitor profiling coalesces all of the relevant sourcesof competitor analysis into one framework in the support of efficient and effectivestrategy formulation, implementation, monitoring and adjustmentIn order to evaluate the competitive position we have to take a look on thecompetitors of ³Nestle juices´ in JUICE CATEGORY.Competitors in market y Shezan y Haleeb y Malee y Country y FrazShezan is the main competitor of ³Nestle juices´ nestle juices compete theircustomer on quality basis because In Pakistan their in no big name in pure fruitjuices. nestle provide their customer pure fruit juices.Brand Audit 24 Nestle juices
  25. 25. ShezanShort introduction of ShezanThe Shezan International Limited was incorporated on May 30, 1964 as a PrivateLimited Company. Shezan International Limited was conceived as a joint venture bythe Shahnawaz Group, Pakistan and Alliance Industrial Development Corporation,U.S.A. in 1964. Shezan is the largest food processing unit having developed andinstalled the capacity to meet the countrys local as well as export needs. In 1971,Shahnawaz group purchased all the shares of Alliance Industrial DevelopmentCorporation with the permission of the Government of Pakistan. In 1980-81 aseparate unit was installed in Karachi which now caters for Karachi, Sind and exportdemand. A bottle filling plant was set in 1983 in Lahore, Punjab. An independentTetra Brik plant was commissioned in 1987.In the year 1990 it was decided to installa juice factory at the Hattar in North West Frontier Province of Pakistan. ShezanInternationals Head Office Located in Lahore, Pakistan. In Canada, Target Foods, isthe authorized distributor for all Shezan Products. They carry all the export quilityJuices, James, Pickles, Chutneys, Sauces, Syrups and Squashes.The products of the Company include tetra pack juice, mango juice, pickles,custards, vegetables, jellies and jams. The Company distributes the products underthe Shezan brand name. y Strong local name in the juice and drinks range ± Launched Shezan Orange ± Launched Twist (nectars) 2003 ‡ Aggressive marketing campaign print, electronic ± Shezan All Pure 2004 ± No trial generation activities ‡ No consumer reward/loyalty CPs ‡ Available packaging options ± Shezan All Pure 1 Ltr ± Nectars ‡ TwistBrand Audit 25 Nestle juices
  26. 26. ‡ Shezan nectars 1 Ltr Swot analysis of shezan juicesStrengths:1. Shezan has it own fruit forms.2. Shezan juices operate in market earlier than nestle juices.3. Better knowing the culture of country.4. Shezan juices have best distribution channel in all over the Pakistan.5. Offer good quality products especially nectars juices in market.6. Shezan juices have good positioning in customer mind.Weakness1. Less product awareness in customer mind.2. Rising manufacture cost3. Inadequate human resourceOpportunities1. Shezan juices have great perception value in minds of customers while as Pakistanorganization.2. Increase juices market very fast.3. The concentric diversification in different juices products.4. Backward integration can use in juice products of Company.5. Decreasing economy condition.Threats1. There is strong competition in juices market.Brand Audit 26 Nestle juices
  27. 27. 2. Different strategies adopted by competitors Nestle in juices products3. New product advancement by different competitors.4. Increase inflation rate (23.3% 2008)5. Rising labors coast. Swot analysis of nestle juicesStrengths1. Company ImageNestle company has a great image in the mind of people. Nestle company hasworldwide reputation.2. Quality ConsciousNestle produce a good quality products. It can not compromise on quality.3. Well-developed strategyNestle has recognizes there is a right time and place for their product; therefore, theirstrategy makes room for adjustments4. Market ShareNestle juices has a highest market share i.e. 60% in juices market.5. Good marketing skills and servicesNestle is now a days working on this concept because they want to increase theirmarket share. They are providing quality products to the customers that include theirservices and products.6. Brand strength - In Pakistan Nestle has some very strong brands like Nescafe,Maggie, Cerelac, nestle water and these brands are almost generic to their productcategories.Brand Audit 27 Nestle juices
  28. 28. 7. Research &DevelopmentResearch and development department keeps Nestlé in continuous knowledge aboutitself and competitors. it has a competitor advantage because many local juices haveno research & development department.8. Product innovation - The Company has been continuously introducing newproducts, thus expanding its product offerings.9. HR departmentNestle company has a strong HR department.Weaknesses1. Storage abilityNestle juices not store able for long time. Opportunities1. Support foreign investorsGovernment support foreign investors to invest in Pakistan.2. Scientifically gasThis is great opportunity for nestle company. Because in coming future nestle takethe benefits of uses the scientifically gas.3. Changing Social TrendConsumers in urban areas drink functional drinks on a regular basis as theyincreasingly adopt Western lifestyles, especially the younger generation which ishugely influenced by the Western media. Younger consumers tend to follow Westerneating and drinking habits. There was an increase in demand for functional drinksover the review period.4. Health consciousIncreasing health and hygiene awareness among Pakistanis has greatly increasedsales of fruit/vegetable juice products. Both the government and the media havestarted health awareness campaigns to make Pakistanis realizes that consumption offruit/ juices is as essential as eating food. Fruit/ juices are doing very well in bothurban and rural areasBrand Audit 28 Nestle juices
  29. 29. 5. Global hubSince manufacturing of some products is cheaper in Pakistan than in other SouthEast Asian countries6. Market growthJuices market expands very fast .A new research proves that in future (2012) everyperson use 85.5 liters juices per years.7. limited options in real fruits juicesLimited options in locally produced real fruit juices. Threats1. Government RegulationThey face problem if government employ taxes on them which force them to raisethe price of their product.2. Increase in competitionThere is large competition in juices market3. Entry barrierThere are no many entry barriers so a large numbers of local juices enter in juicesmarket4. Labor coastIncrease labor cost5. Inflation rateIncrease inflation rate very fast .In 2008 expected inflation rate 23.3%.Brand Audit 29 Nestle juices
  30. 30. Porter five forces modelMichael Potters five forces framework can be used to determine whether theindustry is attractive enough to sustain a small or medium size enterprise. The fiveforces of Entry, Rivalry, Substitutes, Buyers and Suppliers jointly determine theintensity of competition and profit potential for a small and medium size firm in agiven industry or market sector. In analyzing each market force, the question iswhether it is sufficiently strong to reduce or eliminate industry profits. The focus atthis stage is at the industry level because industry dynamics and profits of necessitydictate profits of other firms that enter the industry. Also, in carrying out a fiveforces analysis we want to be able to answer this question: If the competitive forcesin the industry are strong, is there some strategy that firms might employ to defend it,or influence the forces in their own favors?Brand Audit 30 Nestle juices
  31. 31. Threat of new entry:The threat of new entrance means when any other company that is not operate in thatproduct category but operate in the other product market or the compant that start itnew venture see a opportunity in this field like juices and they decided to enter inthis market. So the current company that is operating in the market has a great threatfor the new entrance. New entry can raise the threat of competition. In juices marketthere is great threat of new entry. Because in last few years many new juices enter inmarket. There is no major barrier for local juices to enter in market. So many localjuices enter in market like FRAZ, COUNTRY. There is some barrier for stop thenew entranceEconomies of ScaleProduct DifferentiationCapital RequirementsSwitching CostsAccess to Distribution ChannelsBrand Audit 31 Nestle juices
  32. 32. Cost Disadvantages Independent of ScaleGovernment PolicyIf all these things present in the market then no company want to enter in that marketbecause they know there is no any opportunity for it. Bargaining power of supplierThe company needs raw material, labors, component and other supplies. Theserequirement leads to buyers-suppliers relationships between industry and thesuppliers. Suppliers, if powerful can exert an influence on the producing industry,such as selling raw materials at high price to capture some of the industry profits.Suppliers have great bargaining power if the company can not produces its rawmaterials or other ingredients. Suppliers have weak bargaining powers, if in themarket many suppliers and demand of raw material is low.Buyer PowerBargaining power of customer is one of the important forces in the porter five forces.In the field of juices customer has a low bargaining power because they purchase asingle unit and have not in that situation that they can negotiate with seller on pricematter. But the bargaining power of those buyers whose buy in bulk have great andthey want to set the price on their concern.Here you ask yourself how easy it is for buyers to drive prices down. Again, this isdriven by the number of buyers, the importance of each individual buyer to yourbusiness, the cost to them of switching from your products and services to those ofsomeone else, and so on. If you deal with few, powerful buyers, they are often ableto dictate terms to you.Threats of substitutesSubstitute products refer to products in other industries. To the economist, a threat ofsubstitutes exists when a product demand is affected by the price change of aBrand Audit 32 Nestle juices
  33. 33. substitute product. A products price elasticity is effected by substitute product ± asmore substitute become available, demand becomes more elastic since customerhave more alternative . A close substitute products constrains the ability of firms inan industry to raise prices. While the treat of substitutes typically impact an industrythrough price competition. If substitution is easy and substitution is viable, then thisweakens your power. The substitute product has a strong affect if the followingthings are occurredSales of substitutes are growing rapidlyProducers of substitutes plan to add new capacityProfits of producers of substitutes are upIn juices market nestle juices has great threat for substitute like Shezan, Haleeb etc.Competitive RivalryThe big factor determining the strength of rivalry is how actively and aggressivelyare rivals employing the various weapons of competition in jockeying for a strongermarket position and seeking bigger sales. In the market rival create a great threat.Many companies introduce juices in market and increase threat. Many localcompany enter in market, there is also great threat for establish company. Nestlejuices also face lot of competitor rivalry. Some carbonated company introducesjuices in market, it also create threat for nestle juices. The main competitors ofNestle juices in the market Shezan, Haleeb.Brand Audit 33 Nestle juices
  34. 34. Analyze buyer behaviorInitiate buying behaviorThere are two stimuli that insist the consumer to purchase the product that is 1) Consumer internal stimuli 2) Consumer external stimuliCustomer external stimuliThere are following types of people group include in the internal stimuli Family Reference groupSo children, Individual and member in a group are the person who may initiate thebuying process. Usually young generation and families initiate the buying process.Customer internal stimuliA person also insist itself to drink juices due to its internal desire to drink the juice.It is called internal stimuliSometimes if there is group of same age people like young generation friends groupthen any of one or more then two person can insist to drink juices.Distributors and retailers role in buying processProduct after passing through Distributors and Retailers reach to the final customers.So they play very imported role in buying process because distributors are thosepersons who first buy the juice in complete packing then sell to the retailers sodistributors start their purchasing after deciding the profit margins rate and area todistribute the juices. Similarly retailers after buying juices from distributors they sellto final customer after analyzing the brand loyalty and after the judgment of thepacking and attractive offer for the retailers of any promotion scheme for the retailersand profit margins. Source Asim Bakers Al Meraje Bakers China BakersFactors stimuli to purchase.Brand Audit 34 Nestle juices
  35. 35. There are the following factors that insist the person to buy the juices. These areThirstTaste & FlavorFit for bodyMost persons drink the juices due to taste and different fruity flavors. Some peoplelike co2 water but some people like without co2 juices. So many people like to drinksoft juices like nestle fruit juices due to natural taste and flavorSimilarly now a days people are more health conscious so due to fruity mixture theydesired to full fill their esteem needs and so they drink that juices.Evaluate the alternative productCustomer evaluates the product by considering the brand company and theiringredients and packing. They also check the taste, flavor and quality. If the flavorand ingredients are satisfied for the customer and better then the competitor thencustomer can insist itself to buy that juice, otherwise customer may can choose thecompetitor¶s juices.Who take final decisionUsually family main members take the final decision to purchase juices. But a singleperson also can take that decision according to his or her desire.They also implement the purchase transaction. In a family if the main familymember implement the purchase transaction and whole family drinks the juices.Juices are disposable means after drinks mostly packing of the juices are disposed. Marketing SegmentationWe are going to segment juice market on the basis of need. There are following needwhich we came to know that people like to drink during the following stages:For Travelling and occasionalUsually People like to drink during travelling. Because they have to carry single orsmall packing and juices are the best for that. Juice provide them suitable taste andflavour.Brand Audit 35 Nestle juices
  36. 36. For domestic useNestle distributes that volume of juice for large family use which may be used in anyevents and occasions like use with breakfast and dinner etc or serving the guests etc.Targeting 200ml For Travelling and occasional 1000ml For domestic useNestle is first company who launch the these two packing in juices who provide thesatisfaction more as compare to competitors but now competitors also move thissegment and according to that we are going to launch segment of food energy drink.Identifying new segmentsIn Pakistan our segmentation strategy are so strong and the result all the establishedareas have availability of our juices and our target goals achieve easily but accordingto the competitors are moving our segmentation we will launch new segment of foodenergy drink for the sportsmen and professional working people. PositioningBrand strategy is at the heart of marketing strategy. It is the act of designing thecompany offer and image so that it occupies a distinct and valued place in the targetcustomer mind.Nestlé brings you a range of juices that will scintillate your taste-buds and addvariety to suit every momentOranges are in demand not only for their divine juicy flavor but equally celebratedfor their health benefits. They are naturally low in calories, and an excellent sourceof Fiber and Vitamin C.Squeezed from the finest handpicked oranges, 100% pure NESTLE® Pure OrangeJuice has no added sugar and is a good source of Vitamin C. Having Orange juiceeveryday is a great way of strengthening the body resistance against infections andBrand Audit 36 Nestle juices
  37. 37. diseases and maintaining a healthy lifestyle.Point of parity Different flavor Tetra packingPoint of difference 100% pure juice Enhanced nutritionThis is the point of differentiate that nestle always provide good and pure juiceswhich is fit for human bodyBrand elementNameNestle juices is the brand name.Slogan & logoSlogan is the short phrase that communicates descriptive or persuasive informationabout the brand. 100% pure is the slogan of Nestle juices. The slogan shows thatnestle pure juices have good quality and taste. Nestle juices slogan wants to createimage of pure juice with good taste and quality in the mind of customer. Logo ofNestle juices in word marks with text it own name Nestle. Product strategycore benefitCore benefit means the services and benefits the customer is really buying.Our customer fulfills its need of thrust and refreshment by buying our nestle juice.Basic productBrand Audit 37 Nestle juices
  38. 38. It¶s mean what specifically the actual product is.Our actual product is juiceExcepted productA set of attributes and conditions buyers normally expect when they purchase thisproduct.Normally customers want to drink a juice with greater taste and flavor so nestleprovide great and pure juices.Augmented productA product that include features that go beyond consumer expectations anddifferentiate the product from competitors.Our juice taste and flavor is according to the customer expectations because weprovide 100% pure juice. We have no compromise with quality. We try to providemaximum quality and satisfaction to the customers. Quality is our guarantee and wepromised to the customers that we stop the product rather to low the quality ofproduct.Potential productAll possible augmentation and transformations the product or offering might undergoin the future.In future we will introduce new pulp juices in the market nearer future. We willlaunch special juices for sports men and professional working people.Brand Audit 38 Nestle juices
  39. 39. PRODUCT COMPARISON IN MARKET COMPANY QUALITY SERVICES LOCTION EXTRA OF FACILITY PRODUCT Nestlé Better Excellent Excellent Good Haleeb Normal Normal Normal Normal Shezan Good Normal Good Average Communication StrategyNestle company use different sources to communicate their target marketing. nestlecompany use those sources on that the more customer attract like TV,NEWSPAPERS, BILLBORD and when they lunch any secame in juices they usepamphlets to aware their customer. When launch the new juice or new salepromotion for the juice then they spread the awareness about their brand throughfollowing communication strategy.Communication objectiveNestle company use different sources to attract their target customer. The objectiveof nestle produce awareness in our customer about new products and also produceawareness to new customer about nestle juices. Nestle also tells their customer thatnestle provide pure juices to their customers. Nestle also give the knowledge ofnestle juices that they give you energy and good taste. Nestle also give message thatnestle juices are good for your health. Communication strategy of competitorNestle main competitor is shezan juice.shezan also use the same communicationstrategy which adopted the nestle juices.Shezan is also advertising through TV, new papers, billboard.Brand Audit 39 Nestle juices
  40. 40. Adds in TV channelNestle juices give ads on different TV channel at different time .nestle managementalso keep in mind that their competitors use what channel and what time they giveadds. Nestle management also keep in mind what type of customer they attract andwhat time they sit before TV. nestle juices different time on different channel to keepin mind the target customer TV watching time.nestle juices give ads on PTVhome,GEO,ARY an PTV news.News papersNestle company advetise their juices through news papers.large numbers of custmershave reading habits of news papers, so nestle use the media of news papers to attracttheir customer. nestle management also keep in mind that their competitors use whattype of news paper and what time they give their ads.so after all these analysis nestleselect DAWN and NAWAE-WAQT.nestle give their ads on both news paper at thetime of Sunday.BillboardNestle juices attract their customer through billboard. Nestle company select themain city in country and those places where large numbers of customer easily attract.Nestle has a polices to use 500sqr fts in each region.Marketing budgetTV budgetChannel Timing No ads Price/mint TotalPtv home 7.30am 2 100,000(Rs) 232226 2 132226(Rs) 9.15pmGeo 10 pm 2 50000(Rs) 50000ARY 8 pm 2 70000(Rs) 70000Ptv news 9pm 2 40000(Rs) 40000 Total 392226(Rs)Brand Audit 40 Nestle juices
  41. 41. nestle juices give their ads on tv when the juices season on pack. Nestlé give itsjuices ads on different tv channel 24days in different timing. total cost on thisadvertisement 9413424(rs) News paper budgetNews paper size Day PriceDawn 27×4 Sunday 430920(Rs)Nawa-e-Waqt 27×4 Sunday 1,782,000(Rs) Nestle juices advitise their juices on news paper in top season .the total coaton advitisement is 17703360(Rs). Billboard budgetNestle has a polices that they cover each region with 500 sqr fts.in small city the useless billboards. the coast of billboard in different cities has different. there are threerate 40000,70000,and 125000(Rs).total coast on billboards 2560000(Rs)Total advertisement budgetAdvisements sources coastDifferent TV channel 9413424(Rs)Different news paper 17703360(Rs).Billboard 25600000(Rs)Total coast 52716784(Rs) Distribution StrategyBrand Audit 41 Nestle juices
  42. 42. Nestle Company establishes the distribution channels in each famous city of Pakistanlike Islamabad, Karachi, Lahore, Gujranwala, Faisalabad etc.They also acquired the suitable distributors in each city. They hire maximum two orthree distributors in a city due to prevent from their own competition.The provide the margin to the retailers is equal to the interest of band like 7% to 8%.They also pay to use the shelf to store the nestle juices to the retailer for sale to thefinal consumers. Manufacture Where houses Distributor Whole seller Retailer CustomerNestle juices uses different channel to distribute their product. First of all thefinishing goods stored in the ware houses and the next step products sending you thedistributor and distributor distribute throw different channel to whole seller to realtorBrand Audit 42 Nestle juices
  43. 43. and the end to purchasing customer. Nestle distribute their product regularly todistributions because their customers satisfy nestle services. Nestle companydistribution channel urban areas and rural areas, in rural areas the wholesalerdistributes the Nestle juices to the retailers store, and the rural areas the distributorhave a responsibilities to distributes the product to all the realtors stores. Nestlecompany target market in Pakistan all the big and important cities Price StrategyNestle juice are available six flavored and two size in the market. One is 200ml andsecond is 1000ml. The packing of 200ml target of individual customer and 100mlpacking target the whole family. 100% clear juices, the prices on the base of cost ofingredients as well as other operational costs like processing, weighing packagingand logistics. Pricing objectiveMaximum profit marginNestle juices is a big price objective that they provided high quality and positing andwe taken premium price to our customer other than our competitors. Nestle juicescontain maximum profit margin other than their competitors.Quality leadershipNestle juices is a main objective that its responsibility to provided best quality whothey promised to their customers and they fulfill their promised. In the recentresearch nestle juices is market lender in the soft drink market.Long relationships with customer.Brand Audit 43 Nestle juices
  44. 44. Nestle juices provided superior value to their customer who they promised throwingadvertising. So the customer are loyal the nestle brand. Price Structure (Consumer price) 200ml 18 Rs. 1000 ml 65 Rs. (Mango and orange mix flavored) 1000ml 75 Rs. (Pineapple and red grapes) As they are market followers, they respond to the price strategy of market leader(Nestle) in following manner: Hold currentprice; Has competitor continue to monitor Cut prices competitor¶s price. Yes Will lower priceNegatively affect ourMarket share & profits? Reduce priceBrand Audit 44 Nestle juices
  45. 45. Yes Raise perceivedCan/should effective No quality Action be taken? Improve quality And increase price Launch low-price ³Fighting brand´Price Demand curve Demand have a impact on a company objectives because price are inversely todemeaned, if price is high so demand is low of the product . Nestle company alwaysaware of the price sensitivity of the customer so it known about purchasing power ofthe customer. Nestle juices demand curve is elastic because lower price and higherquality produces high revenue. Elastic demand Inelastic demandBrand Audit 45 Nestle juices
  46. 46. Estimating costNestle company do accumulated production because if they producedmass production so it reduced their labored cost and other cost forproduction pocess.its a big advantages of the nestle company whoproduce large quantity of units. With the help accumulated productionNestle company have a low cost of production and high profit margin. Going rate pricingNestle company selecting a price method of going rate price. Becausetheir pricing near the competitor pricing. Shazan juices price is same ofour nestle juices . nestle juices has a market leader in beverage industry. Final priceNestle set the final pricing related to their market competitors so nestleprice do not have impact on the company policy ,and other marketingactivities.Brand Audit 46 Nestle juices
  47. 47. Sal ast ere is , litters nestle juices ein s ld in a nt in a istan. , litters is ein s ld in arac i and is ein s ld in a re, in aisala ad, and in ujran ala and 7 als in sla a ad. Karachi Lahore Faisalabad Islamabad Gujranwala Other Sal anal sis the ears mont l l tot l j i l of tl i litt litt ost is s ot l sal ar , , , / s ear tal Sale , , , , , , , , , , , , , , 1,200,000,000 1,000,000,000 800,000,000 Nestle 600,000,000 400,000,000 200,000,000 0 2003 2004 2005 2006 2007 2008Brand Audit 47 Nestle juices
  48. 48. ReferencesAs the data for Pakistan beverage market and especially the juice market is skater onthe cyber space so here are some links from which data about the particular marketobtained.www.cia.govwww.nestle.com.pkwww.finance.gov.pkwww.nestle.comwww.brandsynario.com/ advertisement ratesMr. Rana Asif (GM)M Usman (Gujranwala Distributor)Brand Audit 48 Nestle juices

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