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all the concepts of marketing applied in this project it'll help you alot
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Acknowledgement
1
We are grateful to our teacher Mr. SHAHZAD ALAM for assisting us
throughout the course of “Marketing”. We have been able to gain
knowledge of unique Marketing concepts by the advanced teaching
methodologies and versatile knowledge of Mr. SHAHZAD ALAM.
We are also highly obliged to Mr. Muhammad Sarfraz the Sales
Promotional Executive for Lahore, Nestle Pakistan Ltd for his assistance
and guidance to develop and compose this report and broaden our
vision on the complex market of milk.
2
History of Nestle Pakistan
3
Nestle have been serving Pakistani consumers since 1988 when the parent company’ Switzerland based’ on Nestle first acquired share in MilkPak.
Nestle acquires 40% share in MilkPak.
In 1990, Sheikhupura factory started the production of Nido Milk Powder cereals;
In 1992, Nestle took over the running of company (Kabirwala plant) and began to develop its Milk collection network.
In 1996 MilkPak was renamed to Nestle MilkPak Ltd.
In 1997, it becomes a fully owned unit of Nestle Pakistan.
In 1998, Nestle Milk collection system in Punjab matures and company is able to buy all its Milk from Farmers instead of relying on contractors.
In 2005, Nestle MilkPak Ltd. Is renamed again Nestle Pakistan.
VISION STATEMENT
4
“The Nestlé global vision is to be the leading
Health, wellness and Nutrition Company in the
World”.
MISSION STATEMENT
“Dedicated to providing the best food to the people,
throughout their day, throughout their lives, throughout
the world”
General Information
5
Head Office in Lahore.
Registered in both Lahore & Karachi Stock exchanges
One among top 25 companies of both exchanges.
Company has more than 37 brands.
Profit for 2010 3,096 million (PKR)
Earnings Per Share 68.28 (PKR)
Leader of consumer market currently
Production Process Of Nestle
Milk Pak
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Comparison of Nestle With Other Brands
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Milk Collection
Cooling
De-CreamingStandardization Storing
Spray Drying PasteurizationEvaporation
Brands Nestle Olpers Haleeb
Brand Image Pure Strong Thick
Promotion TV, News TV, Radio,
Billboards, Shows
TV ,News
Taste Natural Good Creamy
Brand History 1981 2006 1986
Sub Brands Nesvita,Nido Olwell Dairy Queen
Differential Edge Purity, Iron,
Vitamin C,
UHT
All Purpose Good For Tea
8
Most Popular Nestle Brands
Quality is the essential ingredient in all the Nestle brands and also Nestle brands maintains the nutritional balance in a fast pace world, that is why people around the globe choose Nestle Brands. Following are the most popular Nestles Brand:
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Nestle MilkPak
10
IntroductionOf
Nestle MilkPak
Nestle MilkPak is a trusted brand known throughout the country for its
nutritious wholesome, goodness & natural taste. To secure a happier &
healthier future, support of a strong partner like MilkPak is needed.
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Competitors Of Nestle MilkPak
The Main Competitors of Nestle MilkPak are:
Olpers Milk
Haleeb Milk
Gourmet Milk
White & Gold Milk (Sapphire)
12
Competitive Advantage
Nestle MilkPak never compromises on quality.
Nestle Products are available in every City & Town.
It is using the latest technology in its production units.
Nestle makes milk powder of the surplus milk in winter & converts this milk powder into UHT milk in summer.
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14
Marketing Mix of Nestle
MilkPak
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Marketing Mix
Product Price Promotion Placement
PRODUCT
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Product
ProductQuality
Brand Name
Product Life Cycle
Product Packaging
1. Product Quality
Nestle MilkPak has the largest market share due to its consistent quality.
1.1 Core Part:
The core parts of Nestle MilkPak are:
Taste Energy Growth
1.2 Features:
One glass of Nestle MilkPak contains:
Ingredients Quantity
Calcium 41%
Vitamin C 20%
Phosphorous 31-34%
Vitamin A 18%
Energy 160-165Kcal
Iron 20%
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2. Product Packaging
Nestle is committed to reduce the environmental impact of packaging without jeopardizing the safety, quality & consumer acceptance of its products
Milk is a perishable item & requires a special packaging. To meet this objective Nestle MilkPak use Tetra Pack to deliver fresh milk to its customer without sacrificing in health measures.
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3. Brand Name
“Settle Oneself Comfortably”
3.1 Qualities of Nestlé’s Brand Name:
o It is based on company name.
o It is very easy to remember.
o Company brand is directly suggesting its product.
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4. Product Life Cycle:
The product life cycle of Nestle Milk Pak is very strong and it is on maturity stage and it has crossed its initial stages of introduction and growth.
20
Price
Pricing is very important regarding every product. We have to consider
consumers buying power, competitor’s price and cost of production as
well.
1.Price Analysis
No of Unit Nestle Price Olpers Price Haleeb Price
1000 Ml 70 70 70
500 Ml 38 38 38
250 Ml 20 20 20
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2. Factors Affecting Price Strategies
Cost of Raw Material
Government Steps
Cost Of Raw Material :
The cost of milk which the company gets from the farmers is a very
important factor which affects the prices; because in the months from
October to February the shortage of cow milk occurs in the market
and the suppliers supply the milk on high prices which affects the
prices.
Government Interference :
The Government interference is the second important factor which
affects the company in the matter of pricing strategy i.e. Increase in
the prices of oil and other energy resources. These factors highly
affect the supplier and they increase the prices which directly affects
the cost.
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Placement
MilkPak is not sold directly to consumers. A complete distribution
process is followed. It uses indirect channels for distribution like:
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Manufacturer
Distributo
r
Wholesell
er
Retailer
Consumer
Distributors in Lahore
Saeed Brothers
Zakir & Sons
Deen Distributors
SMR Distributors
Distributor Ware Houses
Saeed Brothers Model Town
Town Ship
Deen DistributorsAirport
Ghazi Road
Zakir & Sons Muslim Town More
SMR Fatah Garh
Promotion
24
The promotional strategies for anything is the most important factor in
marketing, therefore a special attention is required to market the
product. For this we use different tools
Advertisement:
About 60% of promotional budget is spent on advertisement.
25
Promotion
Following are the different Advertisement Medias used by Nestle to
promote its product:
Television
Bill Boards
Shelf show
Print Media
Radio
Sale Promotion Activities :
Events:
The company conducts different sports event, fashion shows and school
functions in which they sale their product on discount prices. They also
give their product to participants as a gift or memorandum.
Free Sampling :
On different events free samples are given to the people to attract the
people towards their products.
Public Relations :
26
Nestle remains committed to Pakistan and is deeply engaged in the
recent flood relief activities. By the end of September, 2010 the Company
has so far committed around PKR 24 million to relief efforts in the shape
of food to affected people, water tankers supplying clean drinking
waters, veterinary and vaccination support to cattle and other related
relief.
In addition Nestle SA has donated PKR 20 million and Nestle employees
from Pakistan and other Nestle Markets have also donated additional
PKR 7 million, bringing total contribution to PKR 51 million.
Swot Analysis Of Nestle Pakistan
Strengths:
Strong Brand Name:
Nestle has been serving the Pakistani consumers since 1988 & it has made a strong brand image due to its quality products. It is known for honesty, integrity, full compliance with all applicable laws, and fair dealing.
Product Innovation:
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The company has been continuously introducing new products to expand its product offerings.
Research & Development:
One of the most important strengths of the Nestle is its strong culture. Every one give emphasis to its internal growth, have committed to achieve higher volumes with strong R&D by refurbishing existing brands and innovating new ones.
Solid Financial Position:
Nestle MilkPak annual turnover is Rs.30 Billion which provides it a financial edge over its competitors.
Weaknesses
Narrow Target Market:
The target market of Nestle MilkPak is only the upper and middle class. As poor class cannot afford to buy UHT milk because of its premium price
Low Advertisement:
There are different companies of milk but the name of Nestle MilkPak always stand in the last in term of low advertising and marketing.
Selective Investment:
Selective investment due to uncertain economic and political conditions.
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Rivals:
Relatively a new company in comparison to its rivals e.g. Lever Brothers
Opportunities
Global Hub:
Since manufacturing of some products is cheaper in ASIA as compared to other continents, Nestle Pakistan could become the export hub for the certain product categories.
Health Conscious People:
Now a day’s consumers have become health-conscious. Therefore it is an important opportunity for nestle to come up with variety of health-based products.
Huge Market to Be Target:
Thirty percent of the countries are developed and 70% are developing and have higher GDP. Nestle must have to focus on them.
Threats29
Increasing number of Competitors:
Three main competitors Haleeb, Olpers & Gourmet are the main threat for MilkPak especially the Olpers & Gourmet are growing very fast.
Devaluation of Local Currency:
Price fluctuations due to rupee devaluation as raw material are
imported.
Uncertain Economic Conditions:
The uncertainty of economic conditions possesses a great threat, as the major funds invested in the country come from outside Pakistan
BCG Matrix of Nestle
30
Market Segmentation
31
INDUSTRIAL GROWTH
MARKET SHARE
HIGH LOW
HIGH
LOW
STARS:
Pure Life Water
Confectioneries
QUESTION MARK:
Maggie 2 Minute Noodles
CASH COWS:
Milk Products
Coffee
Infant Foods
DOGS:
Chocolate Drinks
For getting the maximum market share and respect of the product
in the minds of the consumer, as per our observation and market
survey we have concluded that Nestle MilkPak segmentation is
based on two points.
Demographic Segmentation
In-Store Display Segmentation
Demographic Segmentation:
Family, Age & Income
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.
In-Store Display Segmentation
32
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
big 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
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Conclusions
Nestle is a market leader due to different reasons:
Its price is high against its competitors but it matches its quality
with its competitors.
Nestle is today the world’s largest food and beverage company with its mission to provide healthier lifestyle.
Nestle is using its brand name and its packaging is good to promote
its products.
We can easily find Nestle from any retailer shop
References
www.nestle.com.pk
Nestle Annual Report 2010
Nestle Head Office: Mr.Wasim (Sales Deptt.)
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