Nestles Maggi Marketing - Case Study Example

MARKET REPORT By Name Course Instructor Institution City/State Date Executive summary Across the world, Maggi entails a scope of products for aiding in culinary that are absolutely accessible to the foodservice, especially to the chefs. Maggi is a novel product and unique to many countries like UK. Furthermore, it is a Nestle brand of sauce, soups stocks, instant noodles, seasoning as well as bullion. The main company surfaced in 1872 in Switzerland, during industrial revolution a time when factory created employment opportunities for women; thus, having little time to cook for their families. This essay seeks to analyse Maggi, a nestle brand that is widely used in the culinary, especially preparing food for a short time. The study will critically analyse Maggi’s strengths, weaknesses, threats, and its opportunities in novel markets such as UK. The study highlights various attributes of Maggi, and the SWOT analysis showcases the best way of marketing the product and how consumers respond to the product. Towards the end, the study will provide recommendations, which Nestle can use to increase the market share of the product and also to outsmart is main competitors. Table of Contents MARKET REPORT 1 Executive summary 1 Table of Contents 2 Findings and Discussion 6 Recommendations 7 Conclusion 9 Introduction Presently, Nestle is global leading food company, and given that it was instituted by Henri Nestle to manufacture food product for children, it has been allied with offering first-class, client and customer products (Nestlé, 2014). Recently, Nestle has concentrated on developing into a health, nutrition, as well as wellness corporation. Wellness according to Parekh (2014) is concerned with helping individuals to live a life that is healthier, for example, through manufacture of probiotic yoghurts, which assist in maintain the stability of the digestive system. Besides that, Nestle is a global leader in research and development (R&D), and the company’s scientists’ work hard to generate improved and healthier foods. Maggi is a crucial product for Nestle, and undoubtedly it is an international brand that is extensively acknowledged as a foodservices and consumer brand. Owing to industrial revolution, Julius Maggi was requested by the Swiss Public Welfare Society to make a food product that can be prepared hastily, and also that can be digested easily (Nestlé, 2014). In 1863, a formula for adding flavour to meals was developed, and afterwards it heralded for Maggi as well as other food products that are easy to make. Nowadays, Maggi is famous in Malaysia, Australia, New Zealand, Nigeria, India, and more other countries, and is also penetrating new markets like UK. SWOT Analysis Strength Weakness It possesses an enormous brand loyalty. It is the noodles market leader and almost everybody prefers Maggi as noodles. It has generated the enormous distribution channel network for thousands of distributors, traders and so forth. Thus, making it accessible to all and sundry. Ground-breaking brands for global taste buds like Maggi, chicken Maggi, Maggi masala, and tomato flavour which has assisted the product to seize additional market as consumers requires variety. The marketing plan for Maggi was a unique since their tagline itself was extremely successful and caught the mind of the consumer. Generic Brand to global Noodles Constraints such as low market presence in the rural areas Uniform Brand for all categories of food Brand Proliferation Product are reliant on one another Extremely reliant on one flavour Health associated setbacks Opportunities Threats Maggi most outstanding opportunity is their unexploited markets in the rural areas, bearing in mind hitherto they have mostly targeted developed areas such as cities and urban towns. The youths working these days are heightening in haste, therefore, Nestle can open new branches and recruit such individuals and boost production Heightened similarity of global culinary generates novel opportunity for Maggi to enhance its taste further as well as grab enormous market share. Noddles competitors with long history such as, ketchups, Heinz Sauce, and Knorr Soups. Single brand focused competitors such as Wai-Wai and Heinz sauce. Fewer market entry barriers in the noddles market segment Substitute products for Maggi Findings and Discussion In Malaysia as well as India, Maggi are extremely well-liked, whereby statistics indicate that Maggi have 40 percent of the market share in Malaysia, and a 60 percent share in India where it was launched. Ever since 1982, Maggi has been promoted as two minute noodles, and lately it introduced a novel selection of its noodles such as No Trans fat, Less Salt, as well as No MSG, to fuss over the wellbeing conscious. New Zealand supermarkets in 2008 brought in substitute formulations for its curry, oriental, in addition to beef flavours (Nestlé, 2014). A new-fangled attribute is an additional sachet having dried out vegetables. Maggi maintains that the new variety consists of 88 percent lesser amount of total fat as well as 86 percent lesser amount of saturated fat as compared to other 2-minute-noodle produced by its competitors. The novel Maggi variety as well has significantly lesser fat as compared to its own earlier formulation, but the content of salt has been heightened by 31%. However, Nestle have long been criticised that their advertising does not abide by marketing laws in industrialised countries, and also is making deceptive assertions in developing economies where laws allow it. For instance, Nestle uses vegetarian tag on its brand whereas the whole product production process completely uses a number of hydrogenated fats as well as animal fats all from animal sources. According to (Banutu-Gomez et al., 2009, p.19), the line for noodle production is industrially developed for complex combination of animal oils in addition to other by-products from animals for the whole packaging product. In addition, Nestle in 2008 erroneously aired an advertisement on British TV that was destined for Bangladeshi TV. In the ad, Nestle made phony assertions that Maggi would assist to develop physically powerful muscles, hair, as well as bones (Pinto, 2014). According to the Advertising Standards Authority (ASA), Nestle advertisement failed to adhere to the new European Union consumer law, through which advertisers must offer evidence of health claims (Boyle, 2014). Recently, Nestle used novel technology for noodle-processing, in order that it can air-dry rather than oil-fry the noodles; thus, creating the need to change the tastemaker’s production process. In consequence of the above plans, overheads allegedly dropped by almost 14 percent. So as to cook the new-fangled product, customers were required to put in two cups of water rather than the convectional one and a half cups. Evidently, the noodles taste was considerably distinct from the previous noddles, and consumer hostile response that came after the new noodles’ launch took (Pinto, 2014) Nestle unawares. With Maggi volumes dwindling and consumer criticisms heightening, the corporation started to work on strategies to relaunch ‘previous Maggi’ to get the customers back. Additionally, Nestle started figuring out a plan to recuperate Maggi’s spot in the soup market segment. To offset the threat inflicted by Knorr, Maggi soup was relaunched under a new brand known as Maggi Rich (Nestlé, 2014). Recommendations First, Nestle should keep clued-up of the marketplace forces as well as trends, bearing in mind that they are both threats as well as challenges with the novel, ever-present connectivity. An active, interactive Internet existence can put in value to Maggi by means of social as well as personal connections. Basically, brand loyalty relies on quite a few factors, and one is the capability to constantly deliver on the product pledge and an additional is the capability to proactively maintain that loyalty. The advancing worldwide Internet platforms provide countless means to promote knowledge, grab interest, and generate need that brings about action. Besides that, Nestle should try and think outside the brand box, since a first-class brand name as well as logo single-handedly is not adequate. In this regard, a cautiously planned and ever-changing branding plan must be concentrated on forward-looking marketing ideology. In actual fact, marketing and branding are one and the same. Nestle should also allow the present economic challenges be a driver for opportunity as well as creativity. Nestle should re-position Maggi to meet the ever-changing interests of the consumer as well as geo-political actualities. Furthermore, Nestle should look for external know-how to locate the correct plan for the company to optimize Maggi valuation and power. Developing a well-built brand qualities and existence is more multifaceted than it looks like; therefore, knowledge in various fields such as intellectual property rights, technology, and also marketing is vital for developing, shielding, administrating and optimizing Maggi investment. Furthermore, Nestle should stay away from measures that are bound to be unsuccessful.  Albeit the fact that no one can know what the future holds, an excellent management team must be in a position to extrapolate if their strategy could go wrong such as utilisation of novel technology for noodle-processing mentioned earlier. Besides that, nestle must heavily invest on R&D so as to come up with novel Maggi products.  Given that the Nestle begun by serving infants impoverished with nutrition, the company must improve and uncover a way to enhance Maggi with vitamins and substances that will offer infants their everyday needs of calcium as well as their mothers.  For the reason that they must begin from the health of the mothers so as to offer health for infants, particularly nowadays when diabetes is prevalent even amongst the children. To increase their competitive advantage over their rivals, Nestle must keep going with their joint venture activities.  Still, they must not gamble their business with corporations that are weak to sustain the market pressure as well as wherein they become shilly-shally under the competitors’ scrutiny.  Therefore, they must select competent companies that can demonstrate promising performance. Conclusion In conclusion, as big as Nestle could be, it has not tried all the existing strategies, but notably it   has expanded globally, assisted in developing countries financial systems, and has created partnerships with other corporation, which as a result has positively improved the company’s performance. Even supposing the future cannot be told by viewing financial performance, Nestle must extrapolate what could take place and consider every angle of matters either positively or negatively.  It has been observed that this action is vital for Maggi so as to come up with a strategy to triumph over impediments highlighted in the SWOT analysis and improve their strengths for a more enhanced performance in the marketplace.  This essay has laid out, analysed and examined Maggi’s performance in the global market, and also has presented recommendations that could assist Nestle improve their market activities so as to increase Maggi market share. References Banutu-Gomez, M.B. et al., 2009. International Branding Effectiveness: The Global Image of Nestlé's Brand Name and Employee Perceptions of Strategies and Brands. Journal of Global Business Issues, vol. 3, no. 2, pp.17-24. Boyle, M., 2014. Nestle’s frozen foods market drops sharply. [Online] Available at: http://www.journalgazette.net/article/20140407/BIZ/304079989/-1/biz09 [Accessed 7 April 2014]. Nestlé, 2014. Nestlé. [Online] Available at: http://www.nestle.com [Accessed 9 April 2014]. Parekh, D., 2014. Nestle India to focus on nutrition and wellness business. [Online] Available at: http://www.dnaindia.com/money/report-nestle-india-to-focus-on-nutrition-and-wellness-business-1974376 [Accessed 9 April 2014]. Pinto, V.S., 2014. Health tops new Nestle MD's agenda. [Online] Available at: http://www.business-standard.com/article/companies/health-tops-new-nestle-md-s-agenda-114040100952_1.html [Accessed 9 April 2014]. Read More