“Project on Nestle Company”

“Project On Nestle Company”

Submitted To:

Mam Fareeha

Submitted By:

Muhammad Naeem

Roll Number:

0364-BH (E)-ECO-18

Course Title:

Introduction to Business and Entrepreneurship (BAF-2201)

Bsc (Hons.) in Economics

Session 2018-22

Department of Economics

Government College University, Lahore

O1 July, 2020

Contents Introduction: ...... 4 Mission/Vision ...... 4 Market Classification ...... 6 Marketing Ps ...... 6 Products: ...... 7 Beverages:...... 7 Milk and milk products: ...... 7 Price: ...... 9 Place: ...... 10 Promotion/ Advertising strategy: ...... 10 People: ...... 11 Process: ...... 11 Physical Evidence: ...... 12 Market segmentation ...... 12 Bases for segmentation ...... 12 Geographical area: ...... 13 Demographic age: ...... 13 Psychographic: ...... 14 Behavioral benefits: ...... 15 Target marketing ...... 15 Differentiated: ...... 15 Positioning strategy ...... 15 Product differentiation: ...... 15 Channel differentiations: ...... 16 Image differentiations: ...... 16 People differentiations: ...... 16 Service differentiations: ...... 16 Channel of distribution ...... 16 Types of distribution ...... 16 Agents ...... 16 Distributor & Super stockiest...... 16

Mange Area...... 16 Re-distributor ...... 16 Wholesaler & retailer...... 17 Market Communication ...... 17 Two types of promotion ...... 17 Trade promotion ...... 17 Consumer promotion ...... 18 Conclusion ...... 18 Bibliography ...... 19

Introduction: The pharmacist Henri Nestles in 1867 founded Nestle Company, which is one of the world’s largest beverage and Food Company, in Switzerland. It’s held-quartered in Vevey, Vaud, Switzerland. It is a public type and food processing industry. The maximum of Nestle is “good food good life” in 1905 Henri Nestle his Nestle company merges with Anglo-Swiss to form a new Nestle group. Henri Nestle in 1867 launched his ‘farine lactee’ (floor with milk) in Vevey Switzerland. It is a mixture of cow’s milk, sugar and wheat flour. Nestle developed for consumption. In this time he started, iconic, Nest, logo in 1875.Three local business man had by Henri company and factory from Henry Nestle. They expand production and sales due to high skilled workers and chemist. In 1904 first time Nestle besom selling chocolate due to over expert sales for Peter & Kohler. It has 447 factories in 194 countries employing 3, 39,000 people in their company. Approximately 230,000 had employed from worldwide with & 71.7 billion in sales. During year by year Nestle company is increasing different variety of products.

Mission/Vision The world top processing brand and food has most effective mission and vision statements.

Mission:

Nestle company mission is “good food, good life” to consumer for their best consumption, best taste and having most nutritious choices in the largest range of food and beverage like drinks

5 categories and occasions. It is a world’s leading health, wellness and Nutrition Company. It is indicates that Nestle company put their customers at high top of the level, major points of this:

(i) Improving lives

(ii) Boosting health

(iii) Improving communities

Vision:

The vision statements of Nestle company is “ to be a leading nutrition, health and wellness company delivering improved shareholder value by being a preferred corporate citizen, preferred employer supplier selling preferred products” the following two components based on this statements:

(i) Delivering improved values (ii) Be a leading company

Due to long experience Nestle has learned the art leadership.

Market Classification If we talk about market structure, than Nestle is Monopolistic competition where many sellers each produce similar but different type of products. Nestle as a global company approximately a heterogeneous consumer market because people belong to different regions and having different taste, needs, and preferences.

Marketing Ps The 7Ps of Marketing mix:

(i) Products (ii) Promotion (iii) Price (iv) Place (v) People (vi) Process (vii) Physical evidence

Market mix of Nestle Company tells us or shows us about its product line.

Products: It has 8,000 brands with wide range of products across the market. Nestle have various verities of product which satisfy to consumer. In the market company have high range product line which are best qualities different types of products Nestle provide ot5her countries due to their demand. Their products are less costly. Company has strong graft on products. Nestle having own brands. Beverages, milk and milk products, prepared dishes and cooking aides and chocolates etc are big food products.

Beverages: We know about Nescafe which is most famous brand of the Nestle Company and it is a most powerful source of money earning. Nestle distributes their products in many countries. In India, Nestle has launched ‘Nestea’.

Milk and milk products: If we talk about the milk and milk products some are products which are house of Nestle: Nestle every day, Nestle slim and Nestle milk maid. These products are the mixture of milk, sugar and

8 wheat flour. These products are healthy for consumer. They are sources of satisfaction for the consumer.

Prepared and cooking aides: Prepared and cooking aides are a third category of products of Nestle. If we talk about the cash cow of the product then Magi Noodle is most important. In the worldwide, mostly consumer consume their money on magi brand. It has a best quality and fantastic taste. Magi pasta, magi sauce, magi cubes etc, different products of magi brands.

Chocolates: Nestle has sweets taste product chocolates like Nestle kit Kat, munch, polo, éclairs and milky bar. Alpines is newly introduced product which targeting the getting segment in other side of dairy milk and Bourneville by Cadbury. These products of Nestle an upper level then other competitor. The market size is at top. Two major brands which contribute in Nestle reputation are:

(i) Nescafe (ii) Maggi

Price: Individual products have different price. If we talk about the price of any product, it will depend on their quality. In the market competitor of Nestle their products less expensive then nestle due to different in quality. If a consumer takes expensive product so the reason is that it is a best quality of a product. Customer believes on quality. “Best price, better quality”. If we taken an example of magi, its price are higher than other products, like yippee noodles or waiwai. Because products are in best quality then customer buy easily for some extra money. Nestle pricing

10 depend on the packaging and consumption based products. In market we find 16 packet magi but at retail shops, we find 5rs magi.

Place: Nestle has head quarter in Switzerland. But its brands offices are located throughout the world. It business divided into three key zones based on geographical markets:

(i) Americas (ii) Europe (iii) Middle east and North Africa (iv) Asia Oceania and sub-Saharan Africa

Their Products are available on around the world. In global markets it has great impact due to its distribution channel. Now Nestle products are in rural and urban areas. Nestle provides easily access for their customers, due to product availability in every areas mostly customers feel better. Almost, around the world 200 countries Nestle brands name. Nestle also offering their customers through online delivery products through different types of channels.

Promotion/ Advertising strategy: Promotion is a way to tell their target audience about their products, brands and their quality. Nescafe is a one the most advertising compaign that promotion company product. It

11 makes strongest impact in the supermarket. Nescafe focuses on their customer way of life which they live and value of products which having purchasing power. Many different genres of marketing channels which promotes the products of a Nestle company. It also uses social marketing channels for their brands promotion. Now a days it focuses on grow of their products and also sales and revenue. It has several brands iconic in its portfolio. They are increasing their investment through online presence in e-commerce. In 2018, it has approximately 7.4% of net sales through e-commerce. It uses all media channels through which is promotes their products and brands at: TV, print, ATL, online ads.

People: Those employees who work in a company use or make a important rules for the growth strategy of the products. Nestle has been recruiting a lot of people to join their company they provide complete training for their employees and gain more experience. Those people, who work there, provide better customer services. Nestle company organised campaign for their employees for purpose of promotion, dealing and provide better service to their customer. People make an important rule.

Process: Nestle having fast service for their customers. Nestle company uses best combination of technology to process their products. Best technology take less time in purpose of products and

12 all brands of Nestle having new technology for production. Due to the good process system Nestle

Physical Evidence: Nestle has been better physical evidence. They make best infrastructure for the customer. If we talk about Nescafe, there has well-groom staff and cleanly environment which customer wants. There have a good looking building and a logo of Nestle which identify company. They give best platform and customer service. These things, get attraction customers towards themselves.

Market segmentation If we talk about segmentation, we see that every person having own taste on the basis of age, location, weather likes hobbies, purchasing power and money other such factors. It provides customer requirements. It is a part on which, those requirements provide customer which need. It is great platform and different from others. Markets understood all these factors and divided market based on some parameter. Basically, market segmentation provides to major customer for their own need requirements:

Bases for segmentation The following are bases for segmentation on the basis of characteristics of customer.

(i) Geographic area (ii) Demographic area (iii) Psychographic area (iv) Behavioral area

Geographical area: Bases on graphic area like in summer many people don’t take coffee or tea but ice- cream. So, Nescafe ice depends on weather, where warm and cold. It is coffee which consume with ice in ward season. But in winter many people wants tea instead of ice-cream.

Demographic age: It is based on generation. It is basically for the children or new baby born. Products like, Koko crunch, Nido, Cerelac, Lactogen.

Koko crunch It is important for the growth of children because it includes mineral, vitamin and protein. It is chocolate milk. It is very sweet and delicious. It contains child’s required growth and makes strong bone.

Nido Nido is another nutritious milk especially for children whose age above 2 years. It helps child’s growth includes vitamin D and 25 minerals.

Cerelac Cerelac used for new aged baby. It is a mixture of rice and milk and for less than one year’s baby.

Psychographic: Those people/young generations how are eager for chocolate. If we talk kit Kat for those who want to enjoy chocolate. Nestle Nescafe 3 in 1 especially for those customer who have engaged in activity.

Behavioral benefits: It is an efficient way. If we talk about Cerelac, customers who use it gain more benefits from it. It use for less than 1 year baby. It has includes vitamin, more minerals and other nutritious elements which need for babies.

Target marketing After the segmentations next will be target marketing. Segmentation provides opportunity to firm about their customers. After the segmentation company decide where they operate their system. Due to requirements and needs Nestle distributes their target market.

Differentiated: On the bases of the factors in segmentation it provides different products.

(i) Nescafe 3 in 1:

It is for those customers who spend busy the whole day.

(ii) Koko crunch:

For those, who have found of chocolate taste.

(iii) Nescafe ice:

In hot summer it is best for customer. It is cold coffee and provides their customer energy.

Positioning strategy It is very efficiently and effectively by creating product, service, people, channel and image differentiation arrives the consumer touch point easily. It is very hard to comparing their products with other competitive in the market.

Product differentiation: Nestle having many products for target customers. In Nido, 25 types of minerals for children. It also arranged for new baby born nutritious like Cerelac and lactose 1 and 3. Nescafe has 4 types of categories. In magi includes minerals, vitamins and nutritious.

Channel differentiations: Nestle having most experience and good service provider employees. Through these, Nestle provide goods to the customers. Which are easy for their customers?

Image differentiations: Nestle having own brands and different from others competitor in the market. Nestle logo is different from others customers identify through their logo.

People differentiations: In company many people who run the company most powerful and educated and trained than other competitor. They all are running business for long term.

Service differentiations: It is another advantage for company from competition. 24×7 service is available for the customer. It provides high quality checking. It has market and public relation dept. they have better idea about the customer needs and their requirements.

Channel of distribution

Types of distribution If we talk about the distributions of the product through channel than we see that, Nestle has its own networks of distributions having transportation facilities.

Five types:

Agents First of all Nestle send their products to the C&F agents of the company. Then, next at manufacturing unit.

Distributor & Super stockiest After manufacturing unit next it flows to distributor and super stockiest.

Mange Area Distributor has duty to manage how to distribute available products in his area.

Re-distributor Re-distributor takes products from the super stockiest. Re-distributor in-charge managing.

Wholesaler & retailer Distributor and re-distributor, supplies the product in their respective region or area through wholesales and retailer.

Market Communication (a) Types of promotion

It is very hard and struggle like work for company. It means many business or companies’ uses market communications to convey messages about the products and brands value.

➢ Campaign on Nescafe brought Nestle strongest in the market. It was launched approximately two decades ago. It is one of the best advertising campaigns. ➢ Magi another side best quality product and it has innovative campaign. ➢ “Take a brake” is a good marketing for kit Kat. Promotion for best quality product is done smartly. ➢ We see that Nestle has focused on the ground level marketing their brand and product like magi, Nescafe and kit Kat. ➢ Now Nestle is starting Marketing online through, TVC’s and ATL.

Two types of promotion

Trade promotion ➢ Now Nestle is starting trade discount for their customer and channel to keep them motivate. Magi is the most in-demand product in the market. It is a major challenge for Nestle for distribution it. Distributors having benefits get discount. ➢ Nestle face challenging against their competitor on chocolate like product other product which competition is Cadbury. Dairy milk is better than kit Kat but every product having own value, kit Kat own brand and having positioning in the market. So it is very difficult task for Nestle to sale their product, in this way they offer discount or gifts to trade on target sales.

Consumer promotion Nestle give bonus packs and premium items to their consumers, and also provide discount rate. Nestle also started online marketing for some smart creative through TVC’s and ATL.

Conclusion It is one the best food processing in the World. Nestle has done outstanding work toward customer loyalty as like other marker competitors. It has great impact on food s market. It has best quality of foods on over the World customer consume. Nestle struggle towards new brands and best quality of products. Due to their efficiency and experience in their field, their products on all sides of area, may urban or rural. Nestle consumer having easy access towards products. Nestle also provides those products which lead it on the top in the market. Nestle has opportunities towards their customer needs and requirements. Customers take satisfaction from Nestle has relation like friends. On the basis of segmentation it Nestle get easy access to consumers. Nestle products having own positioning in the supermarket. It has many competitors in the market like Dairy Milk and Kit Kat. It has many channel like TVC’s and ATL in these through, company promote their products.

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