ByPranav R Pai

Bcom(Taxation)Chinmaya Vidyapeet

ErnakulamUnder the guidance of

Ms. N Sangeetha

 A Study on

NESTLE AFTER MAGGI FIASCO

Maggi is an international brand of seasonings, instant soups and noodles owned by Nestle since 1947. The original company was founded in Switzerland in 1872 by Julius Maggi. In India and   Maggi instant noodles were very popular; "Maggi" is synonymous with instant noodles and had a 90% share in India. In May 2015, Food Safety Regulators from Uttar Pradesh, India found that Maggi 2 Minute Noodles had up to 17 times the permissible limit of lead in addition to monosodium glutamate in it. In June 2015, it was reported in India that tests had found high amounts of lead and MSG in Maggi noodles, and FSSAI ordered country-wide withdrawal and recall for all 9 variants of Maggi Instant Noodles and Oats Masala Noodles. Thereafter multiple state authorities in India found an unacceptable amount of lead and it has been banned in more than 5 other states in India suggesting them unsafe and hazardous for human consumption.

INTRODUCTION

This project is relevant because this sheds light on the volume and type of impact that one product can make on other products of the same brand. In this case the study is conducted on the impact of maggi’s ban by the Govt.of India on the brand Nestle which is the parent company of Maggi

SCOPE OF THE STUDY

PRIMARY OBJECTIVESImpact of maggi fiasco on other nestle products

SECONDARY OBJECTIVESProspective consumer lossEffect on sales of nestle products

OBJECTIVES

Primary data collection customer survey 50 respondentsSecondary data collection Web, Magazines, text books, media

METHODOLOGY

below 18 18-25 26-35 36-45 above 450

1020304050

40

2016

DATA ANALYSIS

Male Female0

20

40

60

80 72

28

Yes No0

20406080

100120 100

0

1. AGE 2. GENDER

3. Awareness about Maggi controversy

4. Purchasing Nestle products before the controversy .

6. If NO, why?

5. If Yes, why?

Yes

No19%

36%

25%

8%

11%

Brand loyalty

Brand quality

Brand publicity

Promo-tional activity

Pricing

Brand loyalty; 33.33

Brand quality; 66.67

Pricing; 33.33

7. Purchase of Nesle products after the the controversy 8. If yes, why?

9. If No, why?

Yes; 80

No; 20

26%

26%14%

14%

19%

Brand loyalty Brand quality Brand publicityPromotional activity Pricing

Brand loyalty; 28.57

Brand quality; 57.14

Brand publicity; 28.57

Promotional activity; 14.29

Pricing; 14.29

10. Nesle products purchased before the controversy

11. Nesle products purchased after the controversy

12. Loyalty to brand Nesle

Maggi; 63

Nescafe; 40

Kitkat; 48

Milkmaid; 52 Maggi; 39.13

Nescafe; 39.13

Kitkat; 56.52

Milkmaid; 14.29

Yes; 50No; 50

Yes; 44

No; 56

Yes20%

No80%

Yes84%

No16%

14. Influence of family and friends in purchase decision before controversy

15. Influence of family and friends in purchase decision after controversy

16. Are you satisfied with the quality of Nestle products

Yes64%

No36%

Yes88%

No12%

17. Will you consume maggi if it clears all the test

18. Do you have positive attitude towards Nestle products in the present scenario

The company need to convince the customer that their brand quality is still great.From the survey we observe that the negative impact of the controversy has mainly fallen on maggi and kitkat. So the company should put more effort in making a positive attitude among consumer for these 2 products.It is suggested that company should strengthen its brand image because more than one third of the respondents do not purchase on the basis of brand name.

SUGGESTIONS

Brand loyalty is a cushion up on which the company can fall back . since the brand the company should try to build more customer who are loyal to the brand.

Many customer have lost faith in the company after the controversy because they do not try to influence their friends or family to purchase Nestle products. So the company should try to reduce their trust deficit at the earliest.

Nestle is an MNC which is a major player in the FMCG particularly in the food processing industry. This project focus on the negative publicity of Maggi on nestle. We can see that the Maggi controversy has negatively affected the nestle which has raised many doubts about the brand quality of nestle

It is observed that the negative impact of controversy has mainly affected Maggi and KitKat. It has also led to considerable depletion of the brand value of Nestle.

The existing consumer base has shrunk a little which will also affect the inflow of prospective consumers because existing consumer can influence the purchase decision of perspective customer, and because of this factor the sales of nestle products have taken a back seat after the controversy.

CONCLUSION