1. NESTLE
DFMA LAB 1
PRODUCT LIFE CYCLE AND STRATEGIES
Presented by :
Omkar Dharmadhikari 18
Roshni Mutha 44
Anushka Kale 31
Piyush Chaudhary-11
2. ABOUT COMPANY
• Nestlé is the world’s largest food and beverage company. We have more than 2000 brands ranging from
global icons to local favourites, and we are present in 191 countries around the world.
• ESTABLISHMENT-
Products – beverages, healthcare and nutrition, coffee
and cadbury products ,ceralac, loreal, petcare, Maggie, soups
Sauces etc
•
ESTABLISHMENT 1866
FOUNDER Henri Nestle
HEADQUARTERS Vevey, Vaud,
Switzerland
No OF EMPLOYEES 3,08,000
1866
Founded as Anglo-Swiss condesed milk
company
1905
Merged to become NESTLE
until 1947
1977
NESTLE introduced first two
condensed milk products
Late 1990;s
Focused on growing internationally
3. GLOBAL PRESENCE OF NESTLE
• Established over 150 years ago, Nestlé is the world’s largest, most diversified food and beverages company. We have
a unique global footprint and sell our products in 190 countries worldwide. Through enhancing quality of life and
contributing to a healthier future, we aim to deliver sustainable, industry-leading financial performance and earn
trust.
• Nestle India -NESTLÉ's relationship with India dates back to 1912,.After India's independence in 1947, the economic
policies of the Indian Government emphasised the need for local production. NESTLÉ responded to India's
aspirations by forming a company in India and set up its first factory in 1961 at Moga, Punjab, where the Government
wanted NESTLÉ to develop the milk economy.
4. FINANCIAL DETAILS
TURNOVER- CHF91.43 billion
NET PROFIT-CHF10.46 billion
MARKET SHARE-
Maggie occupies 60% market share of
nestle. Maggi’s market share in instant
noodles was 59.1%, The company’s
commodity price index is down by 5.8% in
the June quarter, from over a year ago.
Mkt Cap (₹ Cr.)121426.92
0
5000
10000
15000
2018 2017 2016 2015 2014
turnover
0
500
1000
1500
2000
2018 2017 2016 2015 2014
net profit
Market share of noodles
maggie others
5. VISION,MISSION AND VALUES
• VISION -To bring consumers foods that are safe, of high quality and provide optimal nutrition to
meet physiological needs.
• MISSION -Our mission of "Good Food, Good Life" is to provide consumers with the best tasting,
most nutritious choices in a wide range of food and beverage categories and eating occasions,
from morning to night.
• VALUES-To be a leading, competitive, Nutrition, Health and Wellness Company delivering
improved shareholder value by being a preferred corporate citizen, preferred employer, preferred
supplier selling preferred products.
6. Core competency
• To pose Nestlé product against the competitors, the company will be using differentiation strategy
which will not only differentiate their own from others but also give an edge over others. Nestlé core
products will be very beneficial especially in terms of quality, health, and hygiene and most
important consumer satisfaction. Nestlé augmented products will include consumer satisfaction,
warranty to retailers in terms of expire, delivery and after sales services.
CORE
COMPETANCY
DIFFERENCIATION
STRATEGIES
SUPERIOR QUALITY HYGENIC PRODUCTS
HEALTH AND SAFETY
MEASURES
8. BUSINESS ENVIRONMENT , B2B AND B2C
• BUSINESS ENVIRONMENT -A major challenge with huge capacity for adverse impact on Nestlé’s
business potential concerns the quality of products delivered and thus the quality control schemes for its
products. There have been instances of contamination of products as well as poor supplies which have led
to a number of product recalls from the market
B2B –
Nestle has turned to Walmart owned e commerce company Flipkart to
launch its new Maggi special masala noodles.
Nestle reworked its business streategies to include focus on healthier
options.
Along with Flipkart ,it has also partenered with Amazon and Snapdeal.
9. Product life cycle of Maggi
Launched in 5 flavours initially
masala chicken lasagne curry veg atta noodle
Maggi Rice Noodles (Lemon Masala, ChillyChow and Shahi pulao)
Recent flavours of Maggi (Amritsari Achari , Mumbaiya Chatak,
Super Chennai, Bengali jhaal)
Veg oats noodles
10. PRODUCT LIFE CYCLE GRAPH OF MAGGI
A Concept that provides a way to trace the stages of a product's acceptance, from its introduction(birth)to
its decline (death).
High-failure Rates
No Competition
Frequent product and Modification
Limited Distribution
In order to improve sales , NIL changed the
formulation of Maggi noodles in 1997.
However, this proved to be a mistake, as
consumers did not like the taste of the new
noodles.
In March 1999, NIL reintroduced the old
formulation of the noodles, after which the
sales revived
In 2003 Hindustan Lever Ltd was all set to
take on Nestle's bestselling Maggi 2- minute
noodles by launching a new category of
liquid snacks
11. PLC MANAGEMENT AND STRATEGIES
DEVELOPMENT
FINANCING
MARKETING
MANUFACTURING
INFORMATION
LEGAL ISSUES FACED BY MAGGI
In brief the order dated 5th June, 2015
issued by Food Safety and Standard
Authority of India, Delhi has held M/s.
Nestle India Ltd. The FSSI order
published and available on the public
domain inter alia also directed M/s.
Nestle India Ltd to withdraw and recall
the 9 approved variants of Maggie
instant Noodles from the market since
these products having been found
unsafe and hazardous for human
consumption. The Authority also
directed the company to further stop the
production, processing, import,
distribution and sale of the instant
products from immediate effect.
About 38,000 tons of Maggie was
destroyed and recalled after the ban was
12. PLC STRATEGIES
The product life cycle contains four distinct stages: introduction, growth,
maturity and decline. Each stage is associated with changes in the product's
marketing position.
Product life cycle
introduction growth maturity decline
1.Rapid
skimming
2.Slow skimming
3.Rapid
penetration
4.Slow
penetration
Being selective
1.Improve product
quality
2.Adding new
product features
3.Increase
distribution
network
1.Market
modification
2.Product
modification
1.Reduce
distribution
network
2.Reduce
promotional
expenditure
13. PORTERS 5 FORCE ANALYSIS
Threat of New
Entrants
1.Other food
service
companies
entering the
market
2.Fear of being
ruled out by
large companies
3.FMCG
products require
large amount of
financial, human,
technical and
marketing
resources
Competitive
Rivalry
1.Large number
of food
companies in the
world
2.Low cost
structure
3.Greater
efficiency
3.Better customer
service
4.Prefers to
merge or take
over the
company rather
than spend
money on
marketing.
Bargaining
power of
suppliers
1.Large no of
suppliers
2. Uniqueness of
services
Bargaining
power of
buyers
1.No of
customers
2.Price
sensitivity
Availability of
substitute
1.Cost of
change
