Marketing Overview of Nestle in Australia

The report provides an overview of marketing elements of Nestle in Australia. It includes brand elements, equity, market positioning, loyalty activities, and potential threats. The report also describes a 12-month integrated marketing communications plan for Nescafe Gold.

Running head: MARKETING
Marketing
Name of the Student:
Name of the University:
Author Note:

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Executive Summary:
The report consists of two parts. Part A of the report focuses on providing an overview of
marketing of a famous brand like Nestle based in Australia. The report begins with the snapshot
of the history of the brand with a focus on brand elements like logo, slogan, attributes and values.
There report also provides an insight to the brand equity with a focus on the financial value,
trends and the value compared to the competitors. The report also discusses about the market
positioning and the loyalty activities of the brand with a focus on the loyalty programs and the
social media communities. There are also discussions about the potential threats to the brand
along with a future outlook for the brand. Plan B of the report describes a 12 month integrated
marketing communications plan for a brand of Nestle, Nescafe Gold.

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Table of Contents
Part A:..............................................................................................................................................3
Introduction:....................................................................................................................................3
Brief Snapshot History of the Brand...............................................................................................3
Brand Elements................................................................................................................................4
Brand Equity:...................................................................................................................................5
Market Positioning...........................................................................................................................8
Brand Loyalty Activities:................................................................................................................9
Potential Threats to Brand.............................................................................................................10
Summary and Future Outlook of the Brand..................................................................................11
Part B:............................................................................................................................................12
Media Plan:....................................................................................................................................12
Communication Objectives:..........................................................................................................12
Rationale for Media Selection.......................................................................................................14
Media Schedule.............................................................................................................................14
Estimation of the Media Cost........................................................................................................16
Bibliography:.................................................................................................................................17

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Part A:
Introduction:
The report aims at providing an overview of the marketing elements of a well known
brand. The company chosen here is Nestle, Australia and the brand chosen comprises of the
products of the Nestle brands. Nestle was found in 1908 with the headquarters in Rhodes,
Australia (nestle.com 2019). Nestle not only markets but also manufactures various food
products and beverage in Australia. Nestle even undertakes exporting its own products. The
company however operates as one of the subsidiaries of Nestle SA that is a Swiss based
translational drink food as well as drink Company with its headquarters in the Vevey, Vaud,
Switzerland.
The report commences with a brief snapshot history about the brand and focuses on the
brand elements which include the logo, attributes, slogan and values. The report also focuses on
the financial value of the brand, trends in the brand value and the value compared to the key
competitors. The report also provides an insight into the market positioning including the USP,
target market and competitive advantage. The report also gives an overview of the social media
communities and the loyalty programs. There are also discussions regarding the potential threats
of the brand with sole focus on the competition, economics, change in the market needs and
technology.
Brief Snapshot History of the Brand
Nestle was started in the year 1867 in Vevey Switzerland when its founder, Henry Nestle,
led to the creation of food for the infants while responding to needs for the healthy and the

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affordable products that served as the alternative to the mothers who were unable to breastfeed
babies(nestle-ea.com 2019). The product came to be known as the Farine Lactee. In the year,
1905, Nestle and Anglo Swiss Condensed Milk Company was formed due to merging of
companies. In the year 1919, the company took over two of the condensed milk plants in the
Oregan from Geibisch and Joplin for a whopping $ 250,000. Nestle however experienced a
dynamic phase after end of the Second World War. This not only accelerated growth but also let
to the acquiring of various companies. It was in the year, 1947 that Nestle merged with Maggi,
the manufacturers of soups and seasonings. The period between 1990 and 2011 was marked as
the international growth of Nestle. In July, 2011, Nestle SA bought close to 60 percent of the
Hsu Fu Chi International Ltd for close to about 1.7 billion US dollars. The company also
acquired the unit of Pfizer Inc’s Infant nutrition for about 11.9 billion US dollars. The period
from 2012 to 2018 marked the recent developments of Nestle. In the recent years, Nestlé Health
Science, made various acquisitions including Vitalflo, CM&D Pharma Ltd and Prometheus
Laboratories. The company also holds a minor stake in the vital foods that specializes in
providing solutions based on Kiwifruit for treating the gastrointestinal conditions. In the year
2018, announcements were made where Starbucks and Nestles stuck a distribution deal of close
to $ 7.15 billion that allowed Nestle to not only market but also distribute and sell Starbucks
coffee on a global scale along with incorporating coffee variability of the brand into the
proprietary system of Nestle thereby leading to an expansion of the overseas market for both the
companies.

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Brand Elements
Logo: Nestle brand comes with a nest logo which represents the graphic translation of the
name of the founder Henri Nestle meaning ‘little nest’. This acted as a vital corporate identity
(nestle.com 2019).
Slogan: The tagline ‘Good Food, Good Life’ of the Nestle brand represents the promise of
the brand in enhancing the lives of the people through good food and beverage (nestle.com 2019).
Attributes: Nestle is one of the leading health, nutrition and wellness company with close
to 140 years of operation(5). The company started its operation with the baby foods which was
followed by the production of dairy products and chocolates in the year 1938. The company
constantly innovates in order to keep pace with the fast changes of the world for delighting the
customers.
Values: Nestle coupled integrity with the strong work ethics and desired to put across
quality work. The brand puts across the spirit of openness and cooperation to the opinions and the
ideas of the others (nestle.com.au 2019). Nestle believes in following a realistic approach to
business and creates an openness for new business opportunities and the future trends. Nestle
responded to the health concerns by cutting down the salt and sugar in the breakfast cereals for
selling Cheerios, one of the cereal brand of Nestle in close to 140 countries and accounted for a
global sales figure of about USD 25 billion.
Brand Equity:
Financial Value of Brand:

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Nestle is one of the biggest and the most renowned food company across the world with
market capitalization of close to 231 billion Swiss francs (CHF). In the year 2014, the
consolidated sales amounted to about 91.61 billion Swiss francs where the net profit was close to
14.46 billion Swiss francs (nestle.com 2019). However, the investment on the research and
development amounted to 1.63 billion Swiss francs.
Sales figures with respect to each of the categories are as follows:
 11.3 billion sales in products related to petcare
 9.6 billions sales in the products related to confectionery
 6.9 billion sales of water
 20.3 billion sales in the liquid and the powdered beverages
 16.7 billion sales of ice cream and milk products
 13.5 billion sales of cooking aids and prepared dishes
 13.1 billion sales in heath science and nutrition.
P percentage of Sales in terms of the breakdown in the geographic area:
 43 percent sales from United States
 28 percent sales from Europe
 29 percent sales from Asia and Africa
The company has a reputation score of 74.5 as per the global survey for its online consumers.

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The financial value of the brand is as follows:
Year 2013 2014 2015 2016 2017
Assets 120.442 133.450 123.992 131.901 130.380
Revenue 92.158 91.612 88.785 89.469 89.791
Net Income 10.015 14.456 9.066 8.531 7.183
Employees 333,000 339,000 335,000 328,000 323,000
Trends in the Brand Value:
The trends in the brand value of Nestle are as follows (nestle.com 2019)
Building on the, Health, Nutrition and the Wellness Strategy: The aim of the brand
lies in providing the healthiest and tastiest choices at all times and in all the stages of the life that
is delivered in time saving and convenient manner. The brand puts across healthcare products
that enabled the people in meeting the wellness and the health goals.
Serving and Understanding the Consumer: Nestle believes in the identifications of the
consumer trends and acting accordingly for capturing them so that the brand remains in the
forefront of the Fast Moving Consumer Goods (FMCG) industry.
Ensuring Accelerated Growth: The brand believes in the creation of long term value
that is the result operating and growth efficiency. Nestle ensures the achievement of top line
sustainable growth through selective investment in the higher growth categories and geographies.
Increase in Efficiency: The brand remains committed towards the marginal expansion
and have developed an underlying target of profit margin from 17.5 percent to 18.5 percent in the

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year 2016. The primary driver of the brand remained in reducing the structural cost in non
consumer areas
Prudent Allocation of Capital: Nestle have a stronger portfolio, with profitable
platforms for growth and market positions in various categories. This enables the company in
taking a focused and prudent approach towards allocation of capital thereby ensuring a long term
futuristic growth.
Creation of the Shared Value: This helps the brand in creating value for both the
society and the shareholders.
Value Compared to Main Competitors:
In comparison to the key competitors, Nestle created value through enhancing the quality
of the life and making a contribution towards the healthier future with the aim of delivering
industry leading, sustainable and financial performance thereby earning trust. Nestle also
mentioned that its pricing strategy enabled it in achieving small pick up across the markets which
led the share prices of the company to rise by 2.9 percent. Nestle also believed investing in the
strongest brand while carrying out divestment in the under underperforming businesses,
improved structural efficiency and improved capital allocation for driving the growth and
preserving the margins (nestle.com 2019). Improvements in the geographical locations have
enabled Nestle in stripping the foreign exchange and the divestments and acquisitions and
enhance the sales of the group by 68.4 billion Swiss francs. Besides, the growth momentum of
the company is expected to deliver 5 percent growth in the entire year in comparison to the
competitors.

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Market Positioning
USP: Nestle represents the biggest health, wellness and food processing brand across the
world (nestle.com 2019).
Competitive Advantage: The aim of the company lies in enhancing the lives of the
consumers on a day to day basis by providing healthier, tastier beverages and food choices for a
healthier lifestyle( Brem, Maier and Wimschneider 2016.). The brand puts across a promise to
the consumers for providing safe and higher standard of food. Therefore, the competitive
advantage of the company lies in:
 The unrivalled brand and product portfolio
 The unrivalled development and research capability
 The geographic presence
Target Markets: Nestle inspected the various types of market segment based on the
growth and size and structural attractiveness to introduce its operation in Australia (Payaud
2014). The brand distributes the target market due to the unique wants and requirements of the
target market. Thus, Nestle Australia chose its target market based on the following coverage
policy.
Differentiated Marketing: Nestle chose the target market based on the differentiated
marketing and provided different products based on the occupation, age, season and the climate
of Australia (Toften and Hammervoll 2013). For instance, Nescafe 3 in 1 primarily targets busy
customers while the Koko Krunch and Nesquick are targeted to those who wanted to get the taste
of the real chocolate. Necafe Ice is targeted for the customers in the hot and the warm weather.

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Concentrated Marketing: This helped Nestle in earning a stronger position in the market
since it allowed the brand to have good knowledge about the customer requirement (Dawson
2014). For instance, the brand offers nutrient rick milk powder Lactogen 1 for the babies up to 7
months of age while the Lactogen 3 is for babies with age not beyond 12 months. Nestle also
puts forward cerelac and ceregrow for babies over 12 months of age.
Brand Loyalty Activities:
Loyalty Programs: Nestle broke its ranks with major supermarkets through putting
across its own reward programs (nestle.com 2019). The company offers discounts to the instant
coffee customers depending on the coffee purchases. The brand holds a market share of over 65
percent on its instant coffee and aims at cementing the product loyalty. The program aims at
increasing the communication between the customers and company depending on registration of
the purchases for getting the rewards. In other words, Nestle program is one of its kinds in
Australia since it depends on a specific product for establishing its loyalty program.
Social Media Communities: Nestle focuses on being active on the social media
platforms like Facebook, Twitter, Instagram, Pinterest and You Tube. The pages on the various
social media platforms are dedicated to health, wellness and nutrition. It also delivers
information related to the latest and the updated events (nestle.com.au 2019).
Potential Threats to Brand
Competition: Nestle experiences tough competition in all the product segments from
competitors like Unilever, Danone, Sara Lee, Kraft Foods, Mars Incorporated, Hershey’s and the
Parle Product Ltd.

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Economics: Economic recession and instability adversely impacts Nestle as it one of the
global player. Besides, the increase in the raw material cost influences the profit margin.
Technology: Backward integration for gaining more control over supply chain makes it
not only complex but also affects the business. Besides the innovation brought about by the
technological advancements also acts as challenges.
Changing Market Needs: The changing market needs due to the presence of health
conscious consumers Nestle made an acknowledgement stating that whether it is the reducing the
sugar or addition of natural flavors, the company looks forward in making healthier and tastier
choices.
Summary and Future Outlook of the Brand
 Nestle plans in shifting its entire portfolio towards natural footing with the sole aim of
adding newer dimension to it.
 The brand also focused on the sourcing of appropriate ingredients for the organic
product in order to ensure considerable growth at a faster pace
 Nestle plans in rolling a newer technology that structured sugar differently for faster
dissolution that would deliver more sweetness for a lesser content of sugar
 Nestle also planned introducing a higher protein Nesquik and Milo options in Australia
for generating mass appeal.

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Part B:
This part of the report concentrates on submitting and developing a 12- month integrated
marketing communication plans for the Nescafe Gold from Nestle.
Media Plan:
Communication Objectives:
Target audience:
They represent the segment of the market where an individual group is believed to be the
potentials for patronizing the offerings of the company and thereby providing a response in terms
of what the brand offers. In other words, it represented the portion of qualified market where the
organization ventures eventually. Hence, segmentation and target market helps the firm in
narrowing the options and service only the sectors possessing purchasing power and higher
levels of feasibility. Thus, the target audience of the Nescafe Gold campaign is as follows:
 Youth, Age 16-30: They are school or office goers who spend close to 70 percent
of their time outside home. This group might also comprise of individuals in the
age group of 19 years who might have their first coffee.
 Family Builder, Age 31-45: They are either the office goers of stays at home. This
is the age when people get adapted to coffee.
 Workers and Retirees, Age 46-60: They represent people who are heavy users of
coffee and it is a part of their everyday life.

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Frequency: The integrated campaign for Nescafe Gold comprised of two TVCs, one
portraying the series of content led by influencers that implied outside home activations
including the pop up for barista coffee while the other portrayed content based on samplings
collected in the train station. The motive lay in supporting the re launch of the Nescafe Gold that
included the features of the improved recipes along with an update on its classic packaging into a
modernized design.
Reach: The campaign of Nescafe Gold tried to showcase that meaningful connections
are not only precious and rare but are worth saving since they enrich people’s life in the truest
sense. It is to be noted that individuals will meet close to 80,000 people in a lifetime but it is only
a handful of them who creates a special memory. The integrated campaign for Nescafe Gold
helps in bringing those connections into life through new and emotive TVCs . It tries to daw a
linkage between the care people puts into a relationship and the attention and care that goes in
the making a cup of the Nescafe Gold.
Coverage: The integrated campaign is live till December, 2019 and covers entire brand
immersion outside the home locations including the Southern Cross Station and the Martin Place
Train Station. This would result in Nescafe Gold in reaching to over 1 million commuters.
Besides, there would be experiential sampling taking place through varied number of pop-up
cafes of Nescafe Gold that would act as an extension of their in store baristas. The newly
launched range of Nescafe Gold would also be available in Coles, Woolworths and various other
independent retailers.
Key message Objectives: The objective of the integrated campaign has been in
delivering quality taste through a newer range of coffee that would continue in exceeding the

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expectations of the possibilities of an instant coffee. The campaign also aimed at developing an
impressive customer experience that would incredibly serve 500,000 coffees across the nation.
Rationale for Media Selection
Making an appropriate choice of communication channel will help in determining the
efficiency and the effectiveness of the intended message that influences the target audience.
Nestle will consider these aspects before dissemination of the intended messages to public.
(Broadbent 2013) put across the importance in choosing the appropriate media as it helps in
determining the effectiveness, efficiency, cost, economy, impact, reach and frequency. Print
media refers to the use of the magazines, posters and flyers for passing on the messages across
the public. Electronic media on the other hand comprises of television adverts, radio
commercials, media houses, electronic bill boards and internet or email services. Television acts
as effective medium as a result of its huge coverage and the ability of creating awareness and
stirring certain interest amongst the target market. Print medium allows for a increasingly visual
display in a persuasive manner. Magazine ads and the electronic billboards can provide an easier
explanation on why consumers should opt for products. The other communication channels that
involved the application of marketing tools include sales promotion, public relations, direct
marketing and personal selling and advertising.
The Nescafe Gold was launched via a television campaign that helped in looking at
coffee through interpersonal and powerful lens that provided the bedrock for the launch of the
Nescafe Gold in New Zealand and Australia. This helped in creating a higher impact locally and
augmented the television campaign thereby ensuring a stronger visual impact in the market.

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Media Schedule
The TV advertisements will be launched in 4/01/19 and finish on 11/01/19
The Radio ads would be launched on 11/01/19 and finish on 18/01/19
The Print ads would be launched in 10/01/19 and finish on 25/01/19
The Internet and the Banner ads launched in 9/01/19 and finish on 24/01/19
The Outdoor Billboards ads was launched in 12/01/19 and finish on 25/01/19
Media Measurement
The ways of determining the success of the company has been through past years of
operation via which customer base is recorded. Nestle being one of the largest food and beverage
company across the world comprising of close to 2000 brands that ranged from the global icons
to local favorites and present across 189 countries across the world portrayed the level of
satisfied customers of the company and the presence of repeat purchase. Another striking feature
lay in the level of the turnover intentions and employee satisfaction since employees represented
the key elements and one of the important resources for the organization. Therefore, keeping
them happy ensured better productivity and performance. Corporate Social Responsibility (CSR)
represents a situation where business operates as the pointer of the success attainment. It is not
only enough in taking from environment but also giving back to community (Hoi, Wun and
Zhang 2013). CSR represents an idea that involves the economic, social and environmental
aspects of a particular business.
As Corporate Social Responsibility (CSR) of Nestle Australia lies in enhancing the
quality of the life and contributing to the healthier future (nestle.com.au 2019). Nestle takes an

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initiative for helping close to 50 million children towards healthier lives. The brand contributed
to the community by helping in improving close to 30 million livelihoods that remains directly
connected to the business activities. Nestle Australia also strives for lower environmental
impacts through its operations.
Contingency planning referred to the course of the action designed for helping the
organizations in responding effectively towards significant situation or event that might or might
not take place (Sadgrove 2016). Contingency plan is often referred as the ‘Plan B’ since it is
considered as the alternative actions provided the expected results failed in materializing. For
instance, if the latest creative on the Nescafe campaign by Publicis Sydney fails then as a Plan B,
the media agency MEC can partner with the Australian marketing agency, Social Soup for
launching the campaign on the Nescafe Gold. This will help in showcasing quality and authentic
content by the highly involved micro influencer community that helps in recognizing the
influence and the role of influencer generated content along the branded content within
marketing mix.
The steps towards contingency planning include:
 Step 1: Identification of the risk that could lead to potential problems to the
business
 Step 2: Prioritization of the risk
 Step 3: Creation of the contingency plan
 Step 4: Maintenance of the Plan
Estimation of the Media Cost
TV advertisements = $ 40, 000

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Radio advertisements= $ 18,000
Newspaper and Magazine advertisements and Inserts= $ 24,000
Internet Advertisements = $ 28,000
Outdoor Billboards = $ 7000
Total=$ 117,000

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