Rebuilding Maggi Noodles' Brand Identity in the Market

To revamp the image of Maggi Noodles as fresh and healthy, Nestle can focus on introducing healthier variants like Vegetable Atta Noodles in its product range. A pull and push strategy is recommended to target teenagers, young adults, and middle-aged adults who are sensitive to taste. Conducting regular monitoring and evaluation of the marketing plan will ensure timely corrections.

MARKETING MANAGEMENT

Table of Contents
Executive Summary...................................................................................................................1
SITUATION ANALYSIS..........................................................................................................1
Industry overview...................................................................................................................1
Market trends..........................................................................................................................1
Macro and Micro environment...............................................................................................2
Competition............................................................................................................................2
Company Background............................................................................................................3
OBJECTIVES............................................................................................................................3
Corporate objectives...............................................................................................................3
Marketing objectives..............................................................................................................4
Communication objectives.....................................................................................................4
BRANDING AND POSITIONING STRATEGY.....................................................................4
COMMUNICATION STRATEGIES........................................................................................5
Pull Strategy...........................................................................................................................5
Push Strategy..........................................................................................................................6
Profile Strategy.......................................................................................................................6
MARKETING STRATEGY......................................................................................................7
Target Markets........................................................................................................................7
Use of marketing mix elements..............................................................................................7
ACTION PLAN.........................................................................................................................8
BUDGET....................................................................................................................................9
EVALUATION AND CONTROL..........................................................................................10
CONCLUSION........................................................................................................................10
REFERENCES.........................................................................................................................12

Executive Summary
Nestle is a vibrant organization that offers customers with global standards products
and is well committed to long-term sustainable development along with satisfaction of
shareholders. Also, the company is popular for its brands in Prepared Cooking Aids and
Dishes, Nutrition and Milk Products, Confectionary segments and Chocolates. The below
marketing plan of company is analysing marketing mix of 2 minute Maggi noodles and
evaluating popularity of its health variant Vegetable Atta Noodles. The following marketing
plan is prepared to suggest Maggi in its successful re-launching of brand. For the purpose of
such analysis, various secondary sources have been used to get wide information about the
industry and customer preferences for the company.
SITUATION ANALYSIS
Industry overview
Nestle is one of the leading brands in International Market. It is one of the world’s
largest food manufacturer having 2000 or more brands. It currently manufactures more than
12 different segments of consumer products including cereals, candy, coffee, nutrition, pet
care, ice cream etc. Nestle has been ranked at 72 among top Fortune Global 500 in 2014. It
started its business in early 1860’s with the product as new baby formula buttressed by the
mothers who could not breast feed (Bradley, 2005). Nestle expanded its market afterwards by
producing chocolates being added to the milk. It has annual sales approx. to $100.64 billion
(Nestle, 2014, p.1) with the market capitalization amounting to around $245.71 billion.
Nestle has around 339,000 employees actively working in an organisation. It operates within
196 countries having headquartered in Switzerland. A strong commitment to product
development can be shown in the history of this organisation. In December 2014, it
announced 10 new skin care research centre worldwide spending about $350 million on
dermatology research and development (Culella, 2011). In the year 1947, following various
changes in corporate and ownership structure, Maggie and Nestle merged to develop
Nestlé-Alimentana S.A.
Market trends
Nestle’s flagship brand Maggi has dominated the market of instant noodles for almost
three decades, which is now losing its share in the market due to new entrants like Hindustan
Unilever's (HUL) Knorr Soupy noodles, GlaxoSmithKline's (GSK) Horlicks Foodles, Top
Ramen, Big Bazaar's Tasty Treat and many other small traders. After Maggi Noodles was
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withdrew by Nestle, other competitors also off the market. Hence, at present Yippee of ITC’s
is the only main brand available in the particular category (Daye, 2009). Moreover, a climate
of distrust and alarm has been developed in the customers minds regarding instant packaged
noodles. It has been drastically influenced the industry of instant noodles overall as well as
suppliers to such business comprising many in medium and small sectors. Also, it has
affected the business of retailers in the industry. Organizations including Nestle are making
attempts to revive confidence of customers in packaged snacks. It involves increasing
marketing expenses not only for building brand but also for promoting their offerings as safe
(De Mooij, 2013).
Macro and Micro environment
PEST analysis
Political factors – The Maggi Noodles is greatly influenced by prevailing regulations related
to actions of marketing and food standards. Moreover, stability of government in new
developing economies raising risk for the international procedure. Also, changing global laws
demanding standardized practice from company along with adequate adaptation to distinct
political aspects.
Economic factors – Nestle is required to have enough knowledge and awareness of economic
growth rates, levels of income in the society and changing inflation. The increase in
conscious consumer for the company is also resultant from changing budgets of customers
(Culella, 2011).
Social factors – Due to the large availability of labour force between the ages of 15-64,
Nestle can be able to introduce products line that are compatible with products of its
competitors, like Maggi 2 minute noodles, Vegetable Atta Noodles, etc. that are more fresh
and healthy.
Technological factors – The Company is having development opportunity from e-commerce
and on the basis of which it can make innovations in its available offerings. Moreover,
without making good investment in research and development, the organization would not be
able to reach the leading position in the industry (Bradley, 2005).
SWOT analysis
Strengths
• Maggie is a Nestlé’s well-structured
Weaknesses
• Nestle company is very much depending
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distribution channel results in reaching the
ultimate buyer.
• Since it is well established brand in the
eyes of the customers, consistent growth is
shown.
• Availability of Maggie on small shops
and stalls contribute in its success.
on the sale of Maggie. Day by day there are
new competitors in the market. Even then
company is on the expansion mode.
• People are getting more health conscious
and educated people are known about the ill
effects of excess consumption of Maggie.
Opportunities
 The company (Nestle) can reach the
restaurant chains with new offers.
 Penetrating in the rural area market.
 It can endeavour with other FMCG
products.
Threat
 Awareness among people of its ill effects
through various advertising mode such as
television, internet etc.
 Increasing competition in the market.
Competition
One major competition Maggi had till now is from Nepal based Wai-Wai Noodles and
Japan based Top Ramen (food product of Nissin Group). Till now, Wai-Wai was limited to
eastern market of Sikkim and West Bengal, where it was having 70 percent of total market
share. The company’s main strategy is to develop distribution network first. In this regards,
the brand was initially available on the super stores shelves and then started developing into
different markets. On the other side, Top Ramen was aggressive in the marketing and even
roped ShahRukh khan as its brand ambassador but was failed to achieve its network of
distribution in place (Gupta, 2015).
Next popular brand of Noodle is Yippee Sunfeast that belongs to conglomerate ITC of
India. The company entered into the market during 2000s first decade and has made
considerable presence gradually. By the early of year 2010, Yippee was considered as market
leader and increasing some level of competition for Maggi. One more competitor of Maggi is
Hindustan Unilever’s Knorr Soupy Noodles and has turned into a well-known brand (Saxena,
2005).
Company Background
Nestle is based in India and involved in the business undertakings of food. The food
business of company incorporates groups of products comprising beverages, nutrition, milk
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products, prepared dishes, and chocolates, confectionary and cooking ads. The dairy products
portfolio of organization includes Nestle Slim Milk, Nestle a+ Milk and Nestle MILKMAID.
The company’s beverages include Nescafe Classic, Nescafe, Nescafe Cappuccino, Nescafe
Sunrise and Nescafe Gold. Its prepared cooking aids and dishes portfolio include Maggi Oat
Noodles, Maggi, Maggi Masala-ae-Magic, Maggi Pazzta and Maggi Vegetable Atta Noodles.
Its confectionary and chocolates portfolio include Nestle BarOne, Kitkat, Much, Alpino and
many more (Nestle, 2015).
OBJECTIVES
Corporate objectives
The following are chief corporate objectives of Maggi:
 To attain compatibility with international voluntary standards on the systems of
environment management;
 To develop mutual trust with government authorities, customers and business partners;
 To conserve natural resources and reduce waste;
 To ensure regular improvement of its performance in the environment;
 To create benchmark for the practice of good business;
 To employ new process and technologies at workplace.
Marketing objectives
The company performs its marketing activities for the purpose of attaining below objectives:
 To enhance market share value to 80 percent in the market of instant noodles from the
prevailing 79.3%.
 To promote the brand Maggi noodles as fresh and healthy to eat convenient food
among its target group of single working professionals and mothers;
 To give line extension through the introduction of Mug Noodles/Cup Noodles;
 To upgrade features of current products viz ingredients, packaging, special additives on
the basis of customer feedback.
All above objectives were arrived on the basis of following Ansoff’s market/product
expansion grid:
Existing products New products
Market penetration Product development
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Existing markets (Upgrade current variations of
Maggi)
(Introduce Maggi’s new options)
New markets
Market development
(Identifying new markets for
current variants)
Diversification
(Launch completely new variants
in novel markets)
Communication objectives
The below are communication objectives of Maggi Noodles:
 To get first mover advantage in the industry;
 To connect with more customer base and achieve their loyalty;
 To build new and relevant contacts with clientele base;
 To customize products to suit with changing demands of customers;
 To create best image of Maggi brand;
 To build good awareness of its offerings.
BRANDING AND POSITIONING STRATEGY
The brand of Nestle itself played a main role in the globalization efforts of company.
The logo of Nestle is significant part of corporate identity of organization. A range of
culinary products are offered by Nestle, such as soups, instant noodles, ketchups, sauces and
cooking ads, etc. in the brand of Maggi. Among these, the chief product of company since
1982 is the Maggi 2 Minute Noodles. Till this period, Maggi noodles became a famous snack
throughout the globe (Kumar, 2007). Maggi in the early 2000 was brand leader in the
segment of instant noodles and faced less competition. At the same time, Nestle began
introducing new healthy stuffs on the basis of its global strategy of transforming itself in to
wellness and health organization. Also, Nestle in the year 2005, has employed same tactic for
the brand Maggi with the introduction of Maggi Vegetable Atta Noodles, healthy and fresh
instant noodles made of whole vegetables and wheat flour. But the particular product was not
as popular as instant noodles. Therefore, Nestle is required to get its Maggi right before it
goes out from the market. Nestle should reformulate Maggi according to regulations and
standards followed in different and replace them in stores located over there (Brand
Positioning in Noodles Market, 2014). This will help in re-building the brand by investing in
activities of corporate social responsibility, effective public relations, signing up credible
endorser, etc.
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Maggi itself positioned as 2 minute noodles. Still customers associate Maggi with
“good to eat and easy to cook”. The particular product should remain with its present
positioning, as it seems to be functioning effectively. To beat strong competition of Top
Ramen, Maggi would require some innovations in its product. A cost differentiation strategy
is followed Top Ramen and in order to deal with this successfully, Maggi will need to
position as differentiated product in the market. However, the customers are very sensitive
for taste and on the basis of which products cannot be differentiated greatly. On the other
side, in a growing health conscious market, Maggi has to deal with its negative perception as
unhealthy. The company can successfully deal with all such issues by positioning as a
nutritional snack. In this regards, Maggi’s has recently launched Veg Atta Noodles with the
nutritional value promise (Sengupta, 2005).
COMMUNICATION STRATEGIES
Communication Strategies are helpful to develop brand awareness in any organisation.
These strategies are generally useful to buttress customer relationship. Such strategies define
the product information broadcasting. There are 3P’s of Communication Strategies which are
explained herein below:
Pull Strategy
Pull Strategy basically means that communicating with the end users or customers what
they actually want to receive. This is encumbered by lot of promotional offers for instance
campaign, contest, free coupon etc. If this strategy is applied, it costs quite high to an
organisation. Some of the characteristics of this strategy are explained as:
 Product’s demand is high
 Reasonable high brand loyalty
 Involvement of customers in purchase of product (Sherlekar, Prasad and Victor,
2010).
Push Strategy
Push Strategy refers to the strategy adopted by an organisation to promote the product
to retailer/ distributor for gaining access in the market. In other words, it means broadcasting
the information of a product delivered directly to the customer. This strategy is used when
seller wants to directly sell the product to a customer with the minimum involvement of
advertisement. Some of characteristics of such strategy are:
 Reasonable low brand loyalty
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 Substitutes are available in the market
 Customers are familiar with the product specification (Banerjee, 2008).
Profile Strategy
This is the last communication Strategy which focuses merely on satisfying the needs
of the Stakeholders. It is the strategy which is used generally by all the organisations. The
basic characteristics of this strategy is to build –
 Awareness and Perception
 Attitudes
 Reputation
The above factors can be achieved using:
 Public awareness
 Advertising
 Sponsorship
In case of Nestle, it should use both push and pull strategy. It is because Maggi is a less
involvement foodstuff and its rivals are presented in the market, hence push strategy should
be adopted by company to attract large clientele base. The organization can make trade
promotions and use distribution sales force for pushing its brands by different channels, so
that Maggi can be available at all possible stores where large number of customers do their
daily shopping (Transport and distribution, 2015). Moreover, the company can run
advertisements to pull consumers towards its offerings. The video broadcast on TV can offer
a link to company’s website and a platform for feedback. Such loop of feedback will inspire
influencers in the industry as well as mothers to share the particular video.
MARKETING STRATEGY
Target Markets
The target market for Maggi noodles should be more than a specific demographic market
from infants to seniors as it is a family product which is associated with taste and
convenience. Nestlé’s Maggi in continuing to leverage its existing brand equity which
currently accepted as a filling snack between meals should have following target segments:
 Teenagers: Maggi’s stronghold and larger segment comprises of the youngsters aged
between 4 and 14 years. Innovative products with great taste and instant energy would
help to early buy in this segment which would be beneficial to target for other
segments in future (Da Silva Lopes and Casson, 2007).
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 Young adults: This growing segments need is to have an instant quality product in
between their regular meals. The representational age group 15-29 years old
comprises of school and college going students as well as early young professionals
with decent monthly disposable incomes. They would be ready to pay a premium for
quality and convenience food item that can be easily cooked, and consumed
(Srivastava, 2009).
 Middle-aged adults: The age group of 30-60 years generally have strict preferences
over food however, Nestlé’s Maggi provides the convenience to have a quickly
cooked food which may play a significant role as most of the adults have preference
to have such meals in households to cope up with busy schedules (Douglas, Craig and
Nijssen, 2001).
Use of marketing mix elements
The Marketing mix elements of Nestlé’s Maggi discusses the 4P’s viz. the products, price,
placement and promotions as below:
 Products: Maggi comes under the prepared dish product-line under the parent company
Nestle. The major cash cow segment is Maggi noodles whereas other products within
the brand such as Maggi Pasta, Maggi Sauce, Maggi cubes contributes the bottom line
of the brand. Moreover, there are also various variants like Atta noodles, dried veg
noodles, chicken noodles etc. which provide sufficient breadth to the brand and to
satisfy every consumer needs. The packaging is convenient and enough appealing
which can easily be disposed of (Errington, Fujikura and Gewertz, 2012).
 Price: Pricing strategy of Maggi noodles have the objective of having major market
share therefore are priced competitively. Premium products like cup-o-Maggi and
Maggi soup are high price products with the objective of quality leadership which
consumers are less price sensitive. The differential pricing ranging from different
packaging and product quality provides consumers with sufficient options to choose
from (Schuiling, 2001).
 Place: Nestle have intensive dealer-distributor-retail network to ensure convenience
regardless of big cities or small towns. The Nestle distribution network is well-known
for strong marketing and channel distribution. Various trade discounts and other tactics
help to keep the channel partners motivated for smooth placement of the products
(Jones and Reid, 2010).
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 Promotion: Innovative advertisement campaign of Maggi has proved to push the Nestle
among the top quality brand. The recent campaign focuses on advertising the moments
people have with Maggi which helps to interact with people’s experience with Maggi.
Celebrity endorsements and event promotions helps to attract youngsters to the brand.
The smart promotions along with effective use of TV ads and creative online marketing
helps to create the Nestlé’s Maggi brand as strong with high brand recall value
(Sanchez, 2004).
ACTION PLAN
The action plan integrates all of above developed strategies into priority-wise and well-
organized actions which help to achieve the desired business objectives. For Nestle, it should
be done by breaking down the overall marketing strategy into smaller and achievable steps
and required specific actions for each of them. It consist of short term (6-12 months), medium
term (1-2 years) and long term (3-5 years) action plan according to business goals. The action
plan also include the timeframe, roles and responsibilities, performance indicators and
alternative plan of actions (Kehrer, 2007). An illustrated action plan for advertising strategy
of Maggi is presented below:
Timeframe Plan of Action Responsibility Expected
Performance
Alternative
action
1-3 months Price discounts
on bulk
purchase for
retailers
Sales
Manager
Increase in
quarterly
sales volume
by 8%
Free gift
coupons
6-9 months Renting out
designated
space in
supermarkets
for product
display
Promotional
Manager
Increase in
customer
footfall of
supermarket
by 10%
Provide
assistance to
supermarket
1.5 – 2 years Identifying
Brand
ambassador
Brand
Manager
Increase the
annual sales
volume by
TV
advertising
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and engage in
extensive
advertising
20%
BUDGET
The budget section will provide financial overview of Maggi’s marketing activities. It
consist of break-even analysis, sales forecast and expenses forecast. The break-even analysis
indicate how much sales revenue would be required to reach at the break-even point. For
illustrative purpose let per-unit revenue is EURO 50 and there are 50,000 break even units
and if fixed cost is EURO 100,000 then the break-even point would be achieved when the
sales volume reaches EURO 3,500,000 in 2 years of the planned marketing strategy.
The sales forecast describe the expected volume of quarterly sales. The expenses
forecast is trickier as it would include both the historically successful marketing tactics and
the planned marketing strategies implementation expenses that will be new to occur for
Maggi. Following projected expenses provide illustrative marketing expense budget.
Q1 Q2 Q3 Q4
Sales
Promotion
EURO 3,000 EURO 5,000 EURO 8,000 EURO 11,000
Advertising EURO 5,000 EURO 12,000 EURO 22,000 EURO 25,000
Personal
Selling
EURO 3,000 EURO 2,000 EURO 3,000 EURO 1,000
Total
Marketing
Expenses
EURO 11,000 EURO 19,000 EURO 33,000 EURO 37,000
EVALUATION AND CONTROL
The marketing campaign regular monitoring is significant for its success. The company
is required to analyse and assess its performance for ensuring its long term effectiveness. It
would allow better control over the marketing strategy performance. One adequate method
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that can be executed for the monitoring of marketing plan performance is marketing audit.
Through marketing audit Nestle can use systematic approach for covering all marketing areas
in business (Monteiro, Gomes and Cannon, 2010). This will support in reviewing direction
taken by campaigns plus its results, in comparison to what was set out originally by
marketing objectives. The marketing audit can be conducted on periodic basis. This will give
regular updates along with opportunities to enhance marketing strategy effectiveness.
Moreover, Nestle can perform internal reviews and monitor the marketing performance. It
can be frequently conducted or run regularly for providing continuous summary of marketing
plan success. By conducting original goals analysis with actual outcomes of marketing, the
organization can set benchmarks to make necessary improvements (Payaud, 2014).
CONCLUSION
It can be concluded from above report that Maggi is considered as brand leader in
Noodles segment but facing strong competition from many new entrants and small traders.
The market is becoming health conscious and customers are not easily relying on ready to eat
foodstuffs. Due to this, the products offered by Nestle under the brand Maggi is preferred as
unhealthy in the market. To cope up with this and rebuild brand identity in the market, the
organization has integrated healthy variants like Vegetable Atta Noodles in its product range
and rebuild the image of its 2 minute Maggi Noodles as fresh and healthy to target market. In
this regards, both pull and push strategy is recommended to be adopted by organization. The
Maggi Noodles are mainly targeted to teenagers, young adults and middles aged adults who
are very sensitive of taste and hence a totally differentiation strategy would not be effective
for the company. Moreover, to get best results and make timely corrections in its marketing
strategies, Nestle should conduct regular monitoring and evaluation of devised marketing
plan.
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