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A PROJECT ON:
INTEGRATED MARKETING COMMUNICATIONS
PERSPECTIVE OF
“ NESTLE MILK-PAK ”
SUBMITTED BY:
SUBMITTED TO: MR. MASHHOOD CLASS: MBA- IV
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TABLE OF CONTENTS
Executive summary ------------------------------------------- 4
What is marketing? ------------------------------------------- 5
What is IMC and tools of IMC ------------------------------------- 6
IMC planning process ------------------------------------------- 8
Company chosen for IMC analysis ------------------------------ 9
Company introduction ------------------------------------------- 10
Product chosen for IMC analysis ------------------------------ 16
Segmentation and target marketing for nestle Milkpak ---- 18
Current Market situation ------------------------------------- 23
IMC tools chosen by company for promotion of Milkpak ---- 24
Advertising (main focus) ------------------------ 26
Billboards and the communication process ----------------- 36
Advertising Research -------------------------------------------- 40
Sales promotion ------------------------------------------- 42
Interactive or internet marketing ---------------------- 44
Personal selling ------------------------------------------- 45
Budgeting ------------------------------------------- 46
SWOT analysis from advertising perspective ---------------- 53
SWOT analysis of milkpak industry in Pakistan ---------------- 55
SWOT analysis of the Nestle ------------------------------------ 57
Conclusions & Recommendations ----------------------------- 63
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EXECUTIVE SUMMARY
Nestlé with headquarters in Velvety, Switzerland was founded in 1866
by Henri Nestlé and is today the world's biggest food and beverage
company. The Company's strategy is guided by several fundamental
principles. Nestlé's existing products grow through innovation and
renovation while maintaining a balance in geographic activities and
product lines.
The company succeeded in achieving sustainable profitable growth
during the year under the view driven by successful marketing and
sales strategies and focus on key initiatives.
Consumer confidence in the company’s brand has further strengthened
and the trade remains confident as ever in doing business with it.
Innovation and renovation remained the key to development of new
products. Food services business unit is fast developing the required
skill and competencies to meet specialized needs of out-of –home
customers and hope that the organization structure will be more
strengthened in the coming years. This is changed 12% w.r.t last year.
22.62% as per share. Over all company market share is 80%. Nestlé
share as compared to nur pur,nirala and other are moves around 20to
30%.Total turnover:- 12.9 Billion Rupees
A detailed analysis of the integrated marketing communications used
by the firm is given here in this report along with the budgeting details
and SWOT of company in general as well as from advertising
perspective and of the milkpak industry in Pakistan.
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WHAT IS MARKETING?
“There are many definitions of marketing. The better definitions are
focused upon customer orientation and satisfaction of customer
needs.”
“Marketing is the social process by which individuals and groups obtain
what they need and want through creating and exchanging products
and value with others”
“Marketing is defined by the American Marketing Association as the
activity, set of institutions, and processes for creating, communicating,
delivering, and exchanging offerings that have value for customers,
clients, partners, and society at large.”
“Marketing is a Systematic process which starts from Customer and
ends on Consumer along with profitability.”
“Marketing is successful if customer becomes a repeated consumer
after getting full satisfaction.” AS-HAM.
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INTEGRATED MRKETING COMMUNICATIONS
“IMC calls for coordinating the various promotional elements and other
marketing activities that communicate with the firm’s customers.”
TOOLS OF IMC
ADVERTISING
“It is any paid form of non-personal communication about any
organization, product, service or idea by an identified sponsor.”
PERSONAL SELLING
“A form of person to person communication in which a seller attempts
to assist or persuade prospective buyers to purchase the company’s
products or services or to act on an idea”
SALES PROMOTION
“Those marketing activities that provide extra value or incentives to
the sales force, the distributors or the ultimate consumers and can
stimulate immediate sales.”
PUBLICITY / PUBLIC RELATIONING
“It refers to non-personal communications regarding an organization,
product, service or idea not directly paid for or run under identified
sponsor.”
INTERACTIVE MARKETING
“It allows for back and forth information whereby users can participate
in and modify the form and content of the information they receive in
real time.”
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DIRECT MARKETING
“In this organizations communicate directly with target customers to
generate a response and / target reaction.”
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IMC PLANNING PROCESS
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COMPANY CHOSEN FOR IMC ANALYSIS
Nestlé S.A.
Industry Food processing
Founded Vevey, Switzerland (1866)
Founder(s) Henri Nestlé
Headquarters Vevey, Switzerland
Area served Worldwide
Products Baby food, coffee, dairy products, breakfast cereals, confectionery, bottled water,
ice cream, pet foods
Profit CHF 10.43 billion (2010)
Total assets CHF 110.9 billion (2010)
Total equity CHF 53.63 billion (2010)
Employees 278,000 (2010)
Website www.nestle.com
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COMPANY INTRODUCTION
MISSION
Build branded food business to improve quality of life by offering tasty,
affordable and highly nutritional product to our consumer. While
maximizing stakeholder value
VISION
The strategic priorities of Nestlé milkpak are focuses on delivering
shareholder value through the achievement of sustainable, capital
efficient and profitable long term growth. Improvements in profitability
will be achieved while respecting quality and safety standards at all
times. In line with this objective, we envision Nestlé milkpak to grow
in the shortest possible time into the number one food company in
Pakistan with unique ability to meet the needs of consumers of every
age group- from infancy to old age, for nutrition and pleasure, through
development of a large variety of food categories of the highest
quality. We envision the company to develop an extremely motivated
and professionally trained Innovation and renovation. We aspire, as a
respected corporate citizen, to continue playing a significant role in the
social and environmental sectors of the country. Most innovative and
fastest growing food company offering Products enjoyed in
“Every home every day”
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History
Nestlé headquarters in Vevey
In the 1860s Henri Nestlé, a pharmacist, developed a food for babies
who were unable to breastfeed. His first success was a premature
infant who could not tolerate his mother's milk or any of the usual
substitutes. People quickly recognized the value of the new product,
after Nestlé's new formula saved the child's life, and soon, Farine
Lactée Henri Nestlé was being sold in much of Europe.
1905-1918
In 1905 Nestlé merged with the Anglo-Swiss Condensed Milk
Company. By the early 1900s, the company was operating factories in
the United States, Britain, Germany and Spain. World War I created
new demand for dairy products in the form of government contracts.
By the end of the war, Nestlé's production had more than doubled.
1918 -1938
After the war Government contracts dried up and consumers switched
back to fresh milk. However, Nestlé's management responded quickly,
streamlining operations and reducing debt. The 1920s saw Nestlé's
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first expansion into new products, with chocolate the Company's
second most important activity
1938 -1944
Nestlé felt the effects of World War II immediately. Profits dropped
from $20 million in 1938 to $6 million in 1939. Factories were
established in developing countries, particularly Latin America.
Ironically, the war helped with the introduction of the Company's
newest product, Nescafe, which was a staple drink of the US military.
Nestlé's production and sales rose in the wartime economy.
1944 -1975
The end of World War II was the beginning of a dynamic phase for
Nestlé. Growth accelerated and companies were acquired. In 1947
came the merger with Magi seasonings and soups. Crosse & Blackwell
followed in 1960, as did Findus (1963), Libby's (1971) and Stouffer's
(1973). Diversification came with a shareholding in L’Oreal in 1974.
1975 -1981
Nestlé's growth in the developing world partially offset a slowdown in
the Company's traditional markets. Nestlé made its second venture
outside the food industry by acquiring Alcona Laboratories Inc...
1981 -1996
Nestlé divested a number of businesses1980 / 1984. In 1984, Nestlé's
improved bottom line allowed the Company to launch a new round of
acquisitions, the most important being American food giant Carnation.
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Henri Nestlé
1996+
The first half of the 1990s proved to be favorable for Nestlé: trade
barriers crumbled and world markets developed into more or less
integrated trading areas. Since 1996 there have been acquisitions
including San Pellegrino (1997), Spillers Pet foods (1998) and Ralston
Purina (2002). There were two major acquisitions in
North America, both in 2002: in July, Nestlé merged its U.S. ice cream
business into Dreyer's, and in August, a USD 2.6bn acquisition was
announced of Chef
America, Inc.
Joint ventures
Nestlé holds 26.4% of the shares of L'Oréal, the world's largest
company in cosmetics and beauty. The Laboratoires Inneov is a joint
venture in nutritional cosmetics between Nestlé and L'Oréal, and
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Galderma a joint venture in dermatology with L'Oréal. Others include
Cereal Partners Worldwide with General Mills, Beverage Partners
Worldwide with Coca-Cola, and Dairy Partners Americas with Fonterra
Nestlé is committed to the following Business Principles in all
countries, taking into account local legislation, cultural and religious
practices:
• Nestlé's business objective is to manufacture and market the
Company's products in such a way as to create value that can be
sustained over the long term for shareholders, employees,
consumers, and business partners.
• Nestlé does not favor short-term profit at the expense of
successful long-term business development.
• Nestlé recognizes that its consumers have a sincere and
legitimate interest in the behavior, beliefs and actions of the
Company behind brands in which they place their trust, and that
without its consumers the Company would not exist.
• Nestlé believes that, as a general rule, legislation is the most
effective safeguard of responsible conduct, although in certain
areas, additional guidance to staff in the form of voluntary
business principles is beneficial in order to ensure that the
highest standards are met throughout the organization.
• Nestlé is conscious of the fact that the success of a corporation is
a reflection of the professionalism, conduct and the responsible
attitude of its management and employees. Therefore
recruitment of the right people and ongoing training and
development are crucial.
• Nestlé continues to maintain its commitment to follow and
respect all applicable local laws in each of its markets.
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NESTLÉ IN PAKISTAN
Headquarters in Lahore, the company operates five production
facilities. Two of its factories in sheikhupura and kabirwala and multi
product factories. One factory in Islamabad and two in Karachi
produce bottled water. Through its effective marketing and a vast
sales and distribution network thought out the country, it ensures that
its products are made available to consumers whenever, wherever and
however.
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PRODUCT CHOSEN
NESTLE MILKPAK
Milk Pack was the first tetra pack introduced in Pakistan in 1981 with
green and white packaging that is associated with Pakistan’s flag. It
was a brand that promised natural and healthy milk. It further gained
strength when it was backed by Nestle Switzerland a well established
and reputable international brand that bought in to it and expanded its
scope and activities. It has recently highlighted the use of iron that has
been added to the milk and communicated this in its advertising and
packaging. The tag line also reads as “making a stronger household”.
Milk Collection
The core raw material of Nestle MilkPak is milk. Over the last Twenty
Eight years, the company's prime concern has been to improve the
quality and volume of milk for UHT processing and for other milk
based products. The company successfully established its own
collection system and expanded its operations over a very large milk
shed area in Punjab. Owing to this tremendous growth in the volume
of an extremely high quality raw milk, Nestle MilkPak now produces a
superior quality and better tasting UHT milk, with longer shelf life.
Today, Nestle MilkPak can boast of the largest milk collection network
in the country, unmatched in size, productivity and efficiency. Milk is
collected through a vast network of village milk centers (VMCs), sub-
centers and centers. At these centers, chillers have been installed to
lower milk temperature to 4C for preventing bacteria development
during long hauls to the factories, which are undertaken by a large
fleet of specially insulated tankers.
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Nestle gathers High Quality milk through a comprehensive strategy,
intensive education program for the farmers and the milk collection
staff, up gradation of milk loading and transportation system, increase
in the chilling capacity and above all, adherence to the highest
acceptance standards at all milk collection points, including the
factories.
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SEGMENTATION AND TARGET MARKETING FOR
NESTLE MILKPAK
Demographically:-
Gender wise & Income classes.
Geographically:-
National and International market.
Media Graphically: -
Electronic & Print media
Customers Profile:-
Families, children, Females House wives between the ages of 25-35
who are conscious about health of their children. NESTLE is focusing
People as a whole regardless of demographic, psychographics and
geographic. The main target of the firm is PEOPLE. Which can be
seen from their media and hoardings. Even on the packing design
one can see the FAMILY, which focuses all the age groups.
Market Segmentation
Market segmentation is dividing a market into disting groups that;
1-Have common needs.
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2-Will respond similarly to a marketing action.
Segmentation Steps: _
1. People in areas under the coverage of Nestle supply chain i.e.,
northern & far-off areas.
2. Young mothers having children of age 5-10 years.
3. Young children of age 10 years to youth of age up to 26 years.
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Basis for Segmentation
Geographic Segmentation
Geographic segmentation approach markets are divided into
different units these units may include nations states, countries or
even may neighborhood consumer often have different buying
habits depending upon where thy reside Geographically Nestle has
been very successful in targeting those areas where its competitors
are not easily available. So Nestle Delight will have an advantage
over its competitors in this case of all purpose milk. Nestle can use
its current supply chain to deliver the milk to its target markets. A
large segment belongs to the northern and rural areas of Pakistan
will be covered by Nestle because of strong distribution network.
There is a gap in the supply cycle of milk in some critical situations
when shortage occurs due to short of raw material supply.
Demographic Segmentation
Dividing the market in the basis of demographic variables such as
age sex, family size, education, income, and social classes are
called demographics segmentations
Nestle is currently targeting house wives, people of all ages
especially growing children on basis of its purest form of milk.
Young mother’s segment should be addressed for the better growth
of their children because the purest form of milk.
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So, Nestle fulfill the need of complete healthy and nutritious food
for everyone in family. Youth is to be addressed with respect to the
energy they need to perform their daily tasks.
Behaviorist Segmentation
Dividing consumer into groups according to their uses loyalties or
buying responses to a product is behaviorist segmentation for
example product of brand usage degree of usage are combined with
demographics and psychographic criteria to develop profiles of
market segments Nestle has an advantage that they have already
got a strong brand image. People are loyal to this brand, making
use of which Nestle can specially target this segment & offer them
this new product. By getting advantage of their current customer’s
behaviors.
Needs Based Segmentation
Milk Pack has made different sizes of tetra packs which can match the
needs of buyers, ranging from 0.25 liters to 1.5 liter. Buyers can buy
according to their need between these quantities.
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In-store Display Segmentation
Nestle have also segmented Milk Pack on the bases of In- Store
display segmentation. In this type of segmentation the company have
given different shelves in bib stores and also given the chillers to some
of the agent having the Milk Pack sticker upon them but in Pakistan
unfortunately the shop keepers are not using the shelves properly and
they have put other brand products on those shelves. Drug stores,
grocery stores, book stores, and other retail outlets use segmentation
in order to keep like products close to each other within the store,
making shopping convenient and cross selling more profitable.
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CURRENT MARKET SITUATION
Today, Nestlé MilkPak produces in over 81 countries and achieves 98%
of its turnover outside Europe. Nestlé MilkPak is the world’s largest
milk company, which does 98% of its business. It has an annual
turnover of 70 billion Swiss francs, 522 new factories in 81 countries,
200 operating companies, 1 basic research outer and 20 technological
development groups, has more than 231,000 employees and more
than 8000 products around the globe. There are three companies co-
ordinate the activities of some 200 operating companies around the
globe. Their functions and details are as follows: The first, Nestlé
MilkPak, holds the financial shares in the allied companies. It also
checks the profitability of these companies and to ensure the
profitability of the group as whole. The second, Nestlé MilkPak, has
two areas of activities that are as follows:
• Research and technological development,
• Technical assistance
Beside this, it provides know-how in engineering, marketing,
production, organization, management and personnel training on a
continuous basis. The third company is Nestlé World Trade Corporation
that oversees the import and export of merchandise worldwide.
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IMC TOOLS CHOSEN BY COMPANY FOR
PROMOTION OF MILKPAK
Promotion activities play an important role in re-launching any
product. Increase in target market is possible by personal selling. It
includes persons in retail stores telling the benefits to potential
customers about importance of milk in standard packed form.
Awareness plays the most important role. They should taste house
wives on different places. Because they are the main servers of
such kind of nutritional diets to their family members
TV commercials and Bill Boards should be planned to advertise
properly.
Determining the Promotional Methods
There are various promotional methods like personal selling,
advertising, sales promotions, public relations etc. but the method
adopted by Nestlé for introducing Nestlé UHT Milk was
advertising, outdoor printed media for advertising like
hording boards, new papers, posters etc. Nestlé attracted the
existing customer of the imported brands and potentials customers
through its advertising campaign.
In their campaign, Nestlé mostly focus the small children who are
the major portion of our society and milk and such kinds of
Products are basic requirement of grooming children that the
reason Nestle launched Nesvita Milk especially designed for growing
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children because introduction of calcium diets in daily diet chart is
basic requirement.
To remind the consumers about the product, Nestlé also made
some special racks for retailers and put them on their outlets and as
compared to other milk selling companies existing in the country
Nestle shows always convincing messages to realize customers that
always drink milk but only I pure form .
RE – LAUNCHING
After thoroughly analyzing the reasons of presence of large number
of competitors Nestle decided to re-launch it product with new
packing and new statement “DOOD KI KHALIS GAZAIAT”
It was an opportunity for Nestle to capture the market in such a
way that it will overcome it’s all the discrepancies such as shortage,
inflation based pricings which gave an opportunity to the
competitors to capture the market.
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ADVERTISING (main focus of MILKPAK)
Media opted for: Television, Bill Boards and Print Media.
Slogan: “Good food, Good life”
Theme: MILK FOR EVERY ONE
Push VS Pull: At some stores there is push strategy for the product
where as at some stores its pull.
Promise & Support: BEST MILK FOR DRINKING
Value Preposition: Best value for money.
Marketing Strategy Used:-
Penetration strategy supported by product differentiation
Core Benefit:-
Fulfillment
Functional Benefit:-
Makes Energy
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BROADCAST MEDIA
TELEVISION
Nestle use 40% of their budget on the broadcast media. Television
is the major medium used for the advertisement. Nestle has been
playing commercials on the
TV since they have launched the Nestle Milk pack. Their Ads cover
all the lifestyles of the people. In their ads they have shown many
situations….
RRFriends sitting together
RRChild playing
RRSwimmer
RRFamilies in good modes
RRYounger generation in smiling energy form
In the entire above situation they have showed the importance of the
pure milk, when it’s about athlete, he is health conscious, when friends
sitting together and having fun what they need. The main thing the
NESTLE wanted that people should trust on that Nestle is purest form
of milk.
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RADIO
Nestle is not only advertising on Television but they are also
advertising on radio. They play the vocal ads on Fm 100 and 101.
Advertising on radio is basically for the people who are on roads.
PRINT MEDIA
In the print media Nestle is using the following mediums to advertise.
Magazines & Newspapers
Nestle advertise in both magazine and news paper on weekly and
monthly basis.
The following list of magazine and newspaper in which nestle
advertise:
RRThe News
RRNation
RRDawn
RRSunday Magazine
RRThe Economist
RRMAG, Etc
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BELOW THE LINE
Below the line includes following mediums of advertisement:
RRDirect mail
RROutdoor
RRTransit
RRSupplementary material
DIRECT MAIL ADVERTISING
It is any form of advertising issued directly to the prospect, whether
through the mail, fax, online computer services, salesperson,
dealers or other means rather than through traditional mass media.
Postcards
Nestle send postcards to their home and office persons in the
category of retailers and whole sellers. On different occasion nestle
send them different post cards to build long term healthy
relationships so that they can contribute in increasing the market
share of their product.
Leaflets/ flyers
Nestle has placed many types of leaflets, which contain information
about Nestle Milk pack, at different outlets.
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Folders / brochures
Nestle send brochures of their product to their customers through mail
to make them aware of new innovations and products. This helps
nestle in getting more customers.
OUTDOOR Nestle spend a big share of their advertisement budget on the outdoor
Advertisement, which includes:
RRPainted Billboards
RRMMT
RRVinyl Sheets
RRRotary Plan
Here is an example of their billboards and rotary plan:
Nestle has placed more than 100 billboards across the roads. They
have put on different skins of them, which are showing different
situations in which people are using pure water. According to the
NESTLE they use heavy outdoor advertisement to remind people about
the availability of their product because it is a product for which people
never pre plan to purchase it so to motivate them for the purchase of
Nestle Milk Pack they have to place billboards. Beside this they rotate
the skins of their billboards after few months the reason for this is that
people loose interest in those skins when they see it for a long time so
when they rotate them n place the new one that create the interest
among the people.
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TRANSIT ADVERTISING
Transit advertising is a category of out of home media that includes
bus and taxicab advertising as well as posters on transit shelters,
terminals, and airports.
Types of transit advertising:
RRInside cards
RROutside posters
RRTerminal posters
RRTaxi / bus exteriors
Terminal posters
Nestle has placed many attractive and attention getting poster on the
terminals and stations in different cities.
Scroll Works
Nestle is also advertising on scroll works, as we know scroll works
advertise through mini vans in the city. These van moves
throughout the city when people see the scroll work those ads
remind them of Nestle Milk Pack during delivery towards the retail
outlets and whole sellers.
Skins on Buses
Nestle has pasted their skins on Daewoo city buses, in this category
they are advertising on certain buses.
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Sample View:
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Nestle takes over murree hills: Murree Hills draw enormous crowds from all over Pakistan in the
summers. In a bid to beat the heat in the lush and beautiful
surroundings, men, women and children throng this big and most
popular hill station. Those who came to Murree this summer were in
for a pleasant surprise. The brand and sales promotion teams of the
North Zone had put together an effective outdoor campaign. The
road to Murree was awash with billboards, shop signs, shop boards,
branded umbrellas, stands, shop paintings, wall paintings, POS
materials, regular merchandising, cross road signs, product
sampling and sticker sampling. The activity created a remarkable
impact and the visitors were impressed.
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Billboards
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BILLBOARDS & COMMUNICATION PROCESS
Source
It can be assumed that all communication has a source. The source
provides the purpose for communication. This source should consist
of ideas, needs intentions, information and purpose. Here in this
billboard the source is:
RRNestle (The Company)
Encoding
Translating the source into a code requires encoding. Encoding
develops the information from the source into a code. Here in this
billboard they are encoding that:
RRThe Milk they are providing is so pure that it led you live a long
healthy life because it provides you the real energy and calcium’s.
RRThey focus on the youngster who looks so fresh after having the
Nestle Milk Pak drinking habit.
RRNestle is the one who helps children to grow have purest form of
energy and all the calcium, vitamin, phophours which are the basic
requirement for growing children.
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Message
An encoded document would then express the purpose or message of
the source, the message being that body of information necessary for
sufficient graphic communication. Here in this billboard the message
is:
RR“DOODH KI KHALIS GIZAIT”
Channel
The medium or carrier of the message would be the channel. It is
correct to say that messages can exist only in some channel; however,
the choice of channels is often an important factor in the effectiveness
of communication. Here the channel is billboard.
Receiver
The receiver is the target of the communication. Mass Market is
targeted as everyone milk in daily life in different needs. Youngsters
are prominent in the ad but they are using as symbol of fitness by
using Nestlé Milk.
Decoding
The receiver must have a set of skills and abilities necessary to decode
information into a usable format. Just as a source needs encoding to
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translate the purpose into a message, the receiver needs a decoder to
understand the message. Here in this billboard the decoding is:
RRNatural Beauty
RRHealthy & Attractive Skin
RRFresh
RREnergetic
RRBright Faces
Noise/Interference
Unfortunately, this tidy package of communication tends to break
down when subjected to the nemesis of all communication \
environments, interference.
Interference is the undesired outside influence that tends to prevent
the completion of effective communication. It is capable of occurring at
any level or stage in the process. The goal of any communication is to
eliminate or minimize interference.
In case of billboard we can only consider the traffic signal as source of
noise.
Response/Feedback:
The effectiveness of a communication is assessed when the source
receives a response. The response can be in many forms. Hopefully,
the response or feedback is premeditated and desirable. The feedback
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can be a tangible product of the communication and can lend itself to
easy evaluation.
We like to buy Nestlé’s Milk because its purest form of milk.
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ADVERTISING RESEARCH
A subset of marketing research, advertising research is the
systematic gathering and analysis of information to help develop or
evaluate advertising strategies, ads and commercials and media
campaigns.
Following are the types of the advertising research
RRQuantitative Research
RRQualitative Research
Quantitative Research
Advertisers use quantitative research to measure market situation in
hard number. 3 basic methods to collect quantitative data are
RRObservation
RRExperiment
RRSurvey
Nestle use this research method to get the results about their
advertisement research.
Qualitative Research
Qualitative research seeks in depth, open ended responses, not yes or
no answers to get people to share their thoughts and feelings. This
research is used more often to give advertisers a general impression of
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the market, the customer, or the product. The methods used in
qualitative research are usually described as Projective Techniques
Nestle do both type of research. They do on going research whole year
and on the basis of the results they make their decision for the future.
FEEDBACK & EVALUATING RESULTS
At the end of every month there is a meeting for evaluation of results
and to act on the feedback. The performance if not +, leads toward
change in strategies.
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SALES PROMOTION
As the main focus of the company’s promotional campaign is
advertising, sales promotion strategy is also used somehow,
along with excessive advertising, discounts and incentives
are given to the customers as well as the retailers and whole
sellers on the following occasions especially.
Incentives & Discounts
RRRamadan offers
RRBuy one get one free
RRBundle packaging
As the above 2 are the most darling occasions and people buy much
milk and also tend to look for more offers in the milk sales, therefore
for boosting up sales, sales promotional discounts and bundle
packaging is available in these precious occasions.
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INTERACTIVE OR INTERNET MARKETING
As the main focus of the firm is Advertising, Some times,
especially on Eid and other important muslim occasions,
internet advertising is done on a small scalein which pop-up
come forward on kids websites and play station downloads.
These create interest and fun in kids and promote the brand.
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PERSONAL SELLING
Initially when Milkpak was launched, it was sold door to door
as well to create awareness in the country people and
especially in rural areas to drink pure milk without any
impurities. But that was done for a short time period, as the
company is producing a normal consumer good therefore, it
had its basic push on massive advertising using almost all
form of advertising.
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BUDGETING
Total budgeting of advertising campaign
SR. Nature of Work Cost
1 Radio, TV, Internet & Billboard Ad
Making
200,000.00
2 30 days ad running on HUM TV (details
above)
30,000,000.00
3 30 days ad running on GEO TV (details
above)
3,1400,000.00
4 30 days ad running on Cartoon Network
(details above)
5400,000.00
5 30 days ad on Radio in 5 cities 24 times
per day
500,000.00
6 Bill Boards (details above) 212,50000.00
7 Small boards on Roads (details above) 525,000,00,00.00
8 Print Media (Details above) 18,26,6904.00
9 Other Communication Tools
Key Chains 150,00,000.00
Van 1,750,000.00
Busses Skin 3,750,000.00
2010 and 2011 Calendar 3000,000.00
TOTAL BUDGET PAK RUPEES 5,380,516,904.00
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Budget for Print Media
As for Advertising plan the print media is one of the media which is
being selected. For that the newspapers like DAWN, The Nation, The
News, Jang, Express, and Nawa-e-Waqt are the newspaper on which
the advertisement will be shown.
The below table provides the whole information about their rates
related to front page and the size of advertisement on the newspaper
like 27*4. Per/day charges of the respective newspapers also provided
and than the weekly charges for the front page ad also calculated. In
the end the budget of the whole month for newspaper advertisement
is calculated.
Newspaper Size Weekday
Front Back Page-2
Dawn 20 x 3 331,500 229,500 163,200
27 x 4 459,000 348,840 257,040
Full Page NA NA 1,028,160
Jang 20 x 3 564,300 480,600 396,900
27 x 4 1,015,740 865,080 714,420
Full Page NA NA 2,857,680
Express 20 x 3 616,320 462,240 385,200
27 x 4 1,109,376 832,032 693,360
Full Page NA NA 2,773,440
48
Advertisement Rates of Newspapers:
Total Expenditure charged monthly of giving ad in newspaper:
Billboard rates
Size: 2700 Sq. ft
Rent for 1 month in A1 area: 850,000.00
Total No. of Billboards in Major 5 Major Cities Karachi, Lahore,
Islamabad, Faisalabad and Peshwar are 25
Total Cost: 21,250,000.00
Sr.No.
Name of
Newspapers
No. of ads
/month
Size of
Advertisement
Rate of
front
Page
ad/day
Amount
Charged
Monthly
1 Dawn 8 27x4 459,000 3,672,000
2 Jang 10 27X4 1,015,740 1,01,57,400
3 Express 4 27X4 1,109,376 44,37,504
49
Fm 90 rates for ad
Nestle is not only advertising on Television but they are also
advertising on radio. They play the vocal ads on Fm 90. Advertising on
radio is basically for the people who are on roads; these ads would be
played 24 times a day on hourly Basis in form of Time Check
Total Cost per city:
100,000.00
Total Cities covered: 05
� Karachi
� Islamabad
� Lahore
� Faisalabad
� Peshawar
Total Cost: 500,000.00
50
Cost of tv add on cartoon network
Timing Pricing Basis of
Selection
Days to
run
Time
to
run
per
Day
Total Cost
per day
Total Cost in
campaign
11:00-12:00 25000/10
sec
As our
target
market
includes
Children
also who
may
influence
their elders
to buy and
85% of
children
watch
Cartoons
on regular
basis, so
we may
capture
that part of
audience in
that time
All
Fridays,
Saturdays
and
Sundays
in 30
days
campaign
because,
this time
most of
the
children
are in
school
and these
3 days
are
expected
holidays
for them
1 150,000.00 1800,000.00
16:00:00-20:00 25000/10 Most of All 30 2 300,000.00 3,600,000.00
51
sec favorite
cartoons
for children
run in
these
timings
including
Tom &
Jerry,
Ben10 and
others, we
have
selected
space on
above two
programs
for
commercial
days
TOTAL 5,400,000.00
52
Application of Revenues During the Year
53
SWOT ANALYSIS FROM ADVERTISING PERSPECTIVE
Strengths
• Educated and Skilled Marketing Staff
• Large number of new market offerings.
• Pre purchase virtual display at thousands of shops, stores within
Pakistan, which are also easily accessible for consumers
• Arrangement of events
• Physical evidence Strong Brand image
Weaknesses
• There is weak marketing of Milkpak as there is no advertisement of
Milkpak on official website.
• Lack of awareness among the target market.
• It is a main weakness of milkpak that there are different companies
of milk but the name of nestle milkpak is always stand in the last
because of low advertising and marketing.
Opportunities
• Increasing interest of people
• Few and weak competitors
• Can Reposition itself buy one more Advertising Campaign
• Currently none of competitors is spending money of advertisings, so
I may be beneficial for Nestle to Advertise
• Growth of processed milk is increasing with 20% annually so Nestle
Milkpak has the opportunity to capture a large share of market.
Threats
• Major player may enter target market
54
• Legal and ethical issues.
• Market segment growth could attract new entrants.
• Two main competitors Haleeb and Olpers are main threat for Milkpak
especially the Olpers is growing very fast.
• There is no entry barrier for new entrants as the Olpers has come in
the market.
55
SWOT ANALYSIS OF MILPAK INDUSTRY IN PAKISTAN
Strengths:
� Pakistan dairy industry is the World’s fifth largest
industry
� Pakistan Dairy Industry is Cheaper than Austrai,
America and other developed countries.
� Farmers are engaged in agriculture and dairy at the
same time.
� By-product of Agriculture is used in Dairy
� By-product of dairy is used in agriculture.
Weaknesses:
• Poor profitability for farmers.
• Lack of contact for farmers to the market
mechanism.
• Poor dairy infrastructure in rural areas.
• Lack of education among the farmers is making it
difficult to change farm and dairy management
systems.
• Lack of knowledge about optimal feed.
• Lack of a cold chain to protect milk quality.
• Lack of access to well trained support service staff
such as
• Veterinarians.
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• Despite the huge volume of milk produced in
Pakistan, processors find it hard to procure
sufficient milk to meet future consumer demand.
• Increasing demand for imported products.
• The product range offered to consumers is not
well developed.
• Production of milk falls to 55% of peak production
at its lowest point in mid-June.
• The demand increases 60% during June
compared to December when the milk supply is
ample.
Opportunities:
• There is an opportunity for companies to
introduce value-added products like shrikhand, ice
creams,paneer, khoya, flavored milk, dairy
sweets, etc.
• There is a phenomenal scope for innovations in
product development, packaging and
presentation.
Threats:
• Very low quality milk is provided by the milkmen
to dairy farms which is a very big threat for the
entire market.
• The shortage of milk providing animals is also a
threat for entire milk industry.
57
SWOT ANALYSIS OF THE NESTLE
Strengths
• Socially Responsible Company.
• NML’s products enjoy strong brand image and market pull.
• Innovative and constantly growing product line. NML launched
17 new
• products, including variants of existing products in recent past.
• Sales force is the major resource strength in terms of physical
resources
• of the company.
• Marketing strategies established by the company are innovative
and lure
• customers.
• Financial, marketing and sales strategies are formulated by
gauging the
• customer demands.
• Periodic research carried out to judge market trends.
• It is a large scale organization, with abundant funds and has the
• capability of acquiring weaker firms by throwing them out of
competition.
• The recent acquisition of the water brands Aqua and Fontalia
provide an
• Example for this strength of the company.
• Multinational.
• Growing Sales and profits.
• Major shareholder in the food industry of Pakistan.
• Aggressive Marketing.
58
• Efficient Distribution networks through out the country.
• Quality Products.
• Environment Friendly.
• Skilled labor.
• Educated staff.
• Large number of offerings.
• Pre purchase virtual display.
• Arrangement of events.
• Good background of the company.
• Easy to approach outlets.
• Physical evidence Strong Brand image
• Quality product
• Solid Financial position
• Strong supply chain network
• Qualified work force
• Commitment to High Quality Products
• Focus on research and development Estimations of UHT Milk
Production and Consumption up to 2008– 09
Year Annual Production
(million liters)
2008-09 => 648.43 353.71
2009-10 => 753.89 372.05
Weaknesses
• Selective investment due to uncertain economic and political
conditions.
59
• Feasibility of new products needs to be analyzed, e.g. Nestea
was
• launched some years back but it failed because no customer
demand for
• it existed.
• Relatively a new company in comparison to its rivals e.g. Lever
Brothers.
• Low levels of inventory maintained can be dangerous.
• No credit sales.
• Low sales margins due to highly value added products.
• They cannot launch many of its expensive international brands
due to
• the lower income groups.
• Physically impossibility to have target market.
• There is weak marketing of MilkPak as there is no advertisement
of
• MilkPak on official website.
• Lack of awareness among the target market.
• It Dependency on others (govt. & sponsors) for the arrangement
of
• events. The target market of Nestle MilkPak is upper middle and
high
• class because lower middle and poor class cannot afford to buy
UHT milk
• due to its premium price.
• It is a main weakness of MilkPak that there are different
companies of
• milk but the name of nestle MilkPak is always stand in the last
because of
60
• low advertising and marketing.
Opportunities
• Pakistan is the seventh largest producer of milk in the world with
annual
• output of over 22 billion liters.
• There are substantial growth opportunities considering the
average yield
• of Pakistani animals at only 1,100 liters/annum as compared to
6,000
• Liters/annum for animals in Europe and USA. There are nearly
20 million
• milk producing animals in the country, mostly in Punjab (80%).
• The overall milk market in Pakistan is 20 billion liters, out of
which
• Processed milk contributes only 3 million liters. Nestlé MilkPak
along with
• other processed milk businesses contribute only 2% to this large
market.
• Nestlé MilkPak has expanded its product range by entering the
cold dairy
• market recently by launching Nestlé plain yogurt and now fruit
yogurt is
• Also added to it.
• To expand the cold dairy products range, Nestlé fruit yogurt is
the latest
• addition to this group.
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• The cold dairy market offers many opportunities for the company
which
• can capitalize these products by banking on its superior quality
milk.
• The coffee brand also offers many opportunities for the company
to
• expand by tuning the taste of the masses towards coffee.
• Credit policy can be adopted to increase sales.
Threats
• Price fluctuations due to rupee devaluation as raw material are
imported.
• The uncertainty of economic conditions poses a great threat as
the major
• funds invested in the country come from outside Pakistan.
• The present economic crisis in the world, led to the withdrawal of
foreign
• management from the company and the investment has come to
a halt.
• Competition with Nestlé’s owns smuggled brands.
• Effect of Seasonality’s upon sales.
• Imported raw material, in some of the company’s products.
• Major player may enter target market
• Legal and ethical issues.
• Market segment growth could attract new entrants.
• Economic slow down can reduce demand. Two main competitors
Haleeb and Olpers are main threat for MilkPak especially the
Olpers is growing
62
• Very fast.
• Inflation is getting higher and higher so the purchasing power of
the
• People is decreasing day by day.
• There is no entry barrier for new entrants as the Olpers has
come in the
• Market.
• Taste of consumer has already developed which is hard to
change.
63
-CONCLUSION To put the pre-going discussion in a nut-shell, It can be safely be
ventured to opine that our company has much potential at that time
but if we use the above strategy in proper manner we easily
conclude that we will be able to lead the companies in the Pakistan
and abroad. However there are some discrepancies in such sectors
so we can realize that all the features that are involved directly or
indirectly in the production are working properly at their positions.
Nestle transparency in the Milk price and the marked increase in the
fresh milk delivered to its factories is forcing the hands of
competitors to progressively adapt to new imperatives. As for
Pakistani customers but In all over the world. Speaking for
Nestle Milk Pack is the evident that the company has benefited its
regular customer on the basis of quality and originality. Thus the
story of Nestle in Pakistan provides a good example of successful
joint venture between local companies Milk Pack Ltd. And a foreign
company Nestle. It is also an example of win win-partnership
between a company Nestle Milkpak Ltd and all of its suppliers in raw
material.
In addition Nestle transparency in the milk prices and the marked
quality increase in the fresh milk deliver to its factories are forcing
the hands of the competitors to progressively adapt to the new
imparities.
Speaking for Nestle milkpak it is evident that the company has
benefiting for the spectacular development of its factories in the
milk district sales of finished products in UHT milks , yogurts ,milk
64
powder ,infant formulas, milk base cereals reached in 2004
compare to sales.
After taking an overview of the strategies of Nestle we can easily
understand the successful journey of Nestle Milkpak in all factors of
advertisement and proper awareness abut its products to the
customers before launching and after launching. Also evaluates the
response and feedback of customers on basis or its advertisement
research.
65
RECOMMENDATIONS FOR FUTURE
• Nestle must state in writing that it accepts that the international
code and the subsequent relevant World Health Assembly
Resolutions are minimum requirements for every country.
• Nestle must state in writing that it will make required changes to
bring its Baby Food Marketing policy and practice into line with
International Code and Resolutions.
• Nestle Milk Pack should concentrate on all age groups (by
showing its benefits) instead of concentrating just on child
growth.
• They should try to create strong brand loyalty among customers.
• They should keep in mind the competing environment while
designing their strategies.
• They should concentrate on customer retention.
• They should improve their customer services.
• They should try to exploit the loopholes of their competitor’s
products.
• Should try to cater the mind of the customer by creating some
attractive jingle like Haleeb: Chai banaye khoob haleeb…..
