Presentation on Product Strategies(MAGGI) BY- ASHWANI DADHICH

About Nestle FMCG industry provides a wide range of consumables .The competition among FMCG manufacturers is also growing and as a result of this, investment in FMCG industry is also increasing, specifically in India.

It market its products in 130 countries across the world..

Nestle put nutrition as the core of their business..

Nestle is a Swiss company founded in 1986 by Henri Nestle

Basically the company started to meet the need of the milk in world war I..

Henri Nestle developed a milk-based baby food and soon began marketing it . It was the first product of Nestle.

The Maggi Company merged with Nestle in 1947. Today, Maggi is a leading culinary brand and part of the NESTLE family of fine foods and beverages.

Main focus is on health and wellness..

Good Food, Good Life to All Consumers..**

What is the brand name that comes to your mind when you hear the word NOODLES ?

The Brand Maggi

4th Oct, 2007Tolani Institute of Management studies

Tolani Institute of Management studies

STORY OF MAGGI 2-MINUTE NOODLESIts a Brand of instant noodle made by Nestle India Ltd.

It was founded by the Maggi family in Switzerland in the 19th century..

The Brand is popular in: -Australia -India -Malaysia -New Zealand -Singapore -South Africa

Nestle wanted to explore the potential for such an instant food among the Indian market.

Now it enjoys around 90% market share in this segment.

Over the years Maggi has launched several products under its Brand name.

Nestl India Ltd. (NIL), the Indian subsidiary of the global FMCG major, Nestl SA, introduced the Maggi brand in India in 1982, with its launch of Maggi 2 Minute Noodles, an instant noodles product. initially priced at Rs.2.10 with a close 100% margin The Birth in India

Taste Bhi, Health Bhi PRODUCT VARIANTS

INITIAL STRATEGIES OF MAGGIMaggi has faced a lot of hurdles in its journey in India

The basic problem the brand faced is the Indian Psyche.

Initially Nestle tried to position the Noodles in the platform of convenience targeting the working women.

However, the sales of maggi was not picking up despite of heavy Media Advertising.

To overcome this NIL conducted a research.

(CONT.)NILs promotions positioned the noodles as a convenience product for mothers & as a fun product for children.

The noodles tagline , Fast to Cook, Good to Eat was also in keeping with this positioning.

They promoted the product further by distributing free samples, giving gifts on return of empty packets ,etc.

Effective Tagline Communication.

PRODUCT DIFFERENTIATIONProduct differentiation strategy means how a particular product is different from others on the basis of:Form, Features Performance quality Convenience Durability, Reliability, Style.

the form shape, size, physical structure of Maggi is very attractive as it is easy to carry, comes in various packs and sizes according to customers convenience..

The various features of Maggi noodles are first of all its perfect taste according to the Indian touch & spices

performance level of Maggi is excellent there are various other brands offered target market, but Maggi prevailed as the winner out of them..Quality is the main factor on which emphasizes as it is Maggis main strength which provides Maggi an edge over its competitors ..Maggi products are durable as due to its preparation these products are easy to store, have a long shelf life and can be stored at any given temperatures which is tested and approved.Reliability is also one of Maggis strength, as one can always rely on a Maggie product for a particular taste which it guaranties.. It is an Indian customers psyche that whatever looks good and feels good would be of good quality so Maggi packs had been designed keeping in mind the same concept

The 4 Ps

MAGGI-Product mixMAGGI 2-MINUTE Noodles

MAGGI Vegetable Atta Noodles

MAGGI CUPPA MANIA

MAGGI Vegetable Multigrain Noodles

PRODUCT LEVELS: CUSTOMER VALUE HIERARCHY

Core benefit - FAST TO COOK & GOOD TO EAT. Basic product benefit - good taste with proper nutrition levels and good health. TASTE BHI HEALTH BHI

Expected product benefit - proper and a good package & fully packed seasoning tastemaker & affordable prices.

MAGGI-Pricing

Maggi 2-Minute Noodles (Chicken) 95 gms12.00Maggi 2-Minute Noodles (Curry) 100 gms13.00Maggi 2-Minute Noodles (Masala - spicy) 100 gms12.50Maggi Rice Noodles95 gms15.00Maggi 2-Minute Noodles (Veg atta) 200 gms30.00

Maggi Dal Atta Noodles 100 gms13.00

The Economic Times, Aug12, 2010Nestle had extended Maggi noodles and seasoning to the bottom-of-the-pyramid segment by sellingRs. 4 and Rs. 2 packs at select low-income markets like Mumbai's Dharavi.

MAGGI-PLACEMENT

The distribution network is well spread almost everywhere in India,as it is easily available in all kirana stores, retail store etc.

Whenever, Wherever, However Connecting with Customers out of homeon the moveMaggi Fun spotsSupply in other nestle kiosksITES/BPO employees

MAGGI: PromotionSales PromotionExchange schemesPrice-off offerScratch n Win OffersMoney back offer..Sponsor school quiz..Awareness campaign..

AdvertisementEffective Taglines

Video

Competition Analysis

SWOT analysis

Strength Market leaderUSP- Easy to cook & tastyVarietyBrand loyaltyAdvertising strategy..Distribution channelsWeaknessPerceived as made up of Maida not good for health and calories..Heavily dependent on one flavor ..

OpportunitiesAvailability of New segments (e.g. old age people)Increasing level of income of consumers and fast life.Unexploited rural market..ThreatsITC, the competitor provides higher margins to its distributors and growing fast.Top Raman has adopted the strategy of reducing the price of its product.

F SUPPLIERSDistributors, Raw material suppliers,PackagingFFFF

NEW ENTRANTSFoodlesINDUSTRIAL RIVALRYTop Ramen, Chowmein etcBUYERSCustomer of Mindset, Brand imageSUBSTITUTESChowmein, fast Food, PastaPORTERS FIVE FORCES MODEL

STPD ANALYSIS

SEGMENTINGTARGETINGPOSITIONINGDIFFERENTIATIONAGEKIDSFAST TO COOK, GOOD TO EATTASTEEATING HABITSYOUTH2-MINUTE NOODLESFLAVORSLIFESTYLE OFFICE GOING PEOPLETASTE BHI, HEALTH BHIPACKAGINGWORKING WOMEN

PRODUCT LIFE CYCLE OF MAGGI

INTRODUCTION

The course of a products sales and profits over its lifetime is called the Product Life Cycle..

Product life cycle is a concept that provides a way to trace the stages of a products acceptance , from its introduction (birth) to its decline..

STAGES IN PLCIntroduction Stage..

Growth Stage..

Maturity Stage..

Decline Stage..

PLC OF MAGGITIME

Introduction Stage..

Sales growth tends to be slow at this stage.

Cost per customer is high.

Negative profits.

Competitors are few.

The marketing objective is to create product awareness.

. INTRODUCTORY STAGE OF MAGGI

The product launched keeping in mind the working women and children

No competition

It was the pioneer in the instant noodle market.

Distribution channel Producer -- Distributor --Retailer -- Consumer

INTRODUCTION CONTPRICING The initial pricing strategy was low pricing strategy to make product affordable. PROMOTION Promotion focuses on awareness and information Promoted with the tag line BAS 2 MINUTE. Promotion done by - Giving gifts on empty packets.

Growth Stage

Rapidly rising sales.

Rising profits.

Unit manufacturing cost declines.

The marketing objective is to maximize market share.

MAGGI GROWTH STAGE Sales increased.50% market share.No.1 brand.PRICE- prices were kept normal.

PRODUCT- no any new changesPROMOTION-GOOD TO EAT FAST TO COOKEntry of Competitor

MARKET PENETRATION STRATEGIES Promotional campaigns in school.

Advertising strategies: Focusing on kids

New product innovation according to the need of consumers: -Veg. Atta Noodles -Dal Atta Noodles -Cuppa Mania

Availability in different packages: -50 gms -100 gms -200 gms -family packs(400 gms)

Conducting regular market research.

Maturity Stage

Sales are at peak.Profits are high.Cost per customer low.The marketing objective is to maintain or extend the market share.

MAGGI MATURITY STAGEIntroduced new Variety.Price Rs. 5 Onwards.Big Time Promotional Offers.Slow Down In Sales.Market Saturation.

MATURITY CONT PRODUCT - Maggi introduced wide variety of products like Dal atta noodles, Chicken maggi, Maggi cuppa mania. PRICE - Maggi still comes in very affordable prices starting from Rs. 5, they reduced the quantity instead of increasing price. DISTRIBUTION - Distribution became more intensive. Adopted various intensive programme for encouraging the product over their competitors in the market.

Segmentation To Differentiation Classic Noodles - 5 to 10 yrs..

Veg. Atta Noodles - health conscious.

Rice Mania teenagers..

Cuppa Mania - office goers.

Decline Stage

Sales started declining

Profits are at decline

Cost per customer still at low

The marketing objective is to reduce the expenditure

MAGGI DECLINE STAGESales saw a decline in 1990s. -Formulation changed from fried base to . air dried base. New product launched but failed. -Dal atta noodles of sambur flavour. Tough competition from TOP RAMEN.

Reintroduction of MAGGI Noodle

Reintroduced in 1999Increased DistributionFocus on new segments of SocietyNew & Interesting TV Commercial

CURRENT SCENARIO OF MAGGI

Leading Brand in India as well as World.

Reasonable competitive pricing.

Maggis share of instant noodles, on an all-India basis, across urban markets, has slipped consistently between December 09 to July 10. While Maggi instant noodles had a 90.7% share in December 09, the share dropped to 86.5% in July 10 on an all-India basis..

Maggis market share is certain to get impacted , but add that Nestle has the potential to expand the Rs 1,300-crore instant noodles category which itself is growing at a rapid 15% annually

MARKET RESEARCH

Cont

MARKET SHARE

Chart3

86.5

13.5

market share

Chart1

86.5

13.5

market share

Sheet1

maggiothers

86.513.5

Sheet1

market share

Sheet2

Sheet3

TO concludeHere are some who leads called market leader and there are some who follows, called follower. Maggi has been a leader for decades and it is Maggi who educated Indian consumer about noodles.

Of course, their market share might got depleted in course of time, by the entry of some very big players but Maggi will not sit silent. They will also reinforce their activities which will ultimately benefit the consumer.

People will definitely taste for a change, but it is very difficult to change ones taste bud and the top of mind game, as Maggi has become a generic name in India for their long presence..

- Focus on creating distinctive image, based on twin benefits of INSTANT and HEALTHY with emphasis on health conscious and rural market.

- Conduct promotional campaigns at schools in small towns with population more than 10,000.

Strengthen the distribution channel of the rural areas within 100 km of all the metros.

Foray into other food products like chips, chocolates etc under its sole brand name would not only help in Brand extension but will also enhance Maggis market share.

Launch new advertisement campaign (T.V., Radio etc) with the Brand Ambassador.SUGGESTIVE PROMOTIONAL STRATEGIES

THANKYOU

***************************