Food Industry Influence on Nutrition

This assignment explores the influence of the food industry on nutrition and health. It requires students to examine how marketing strategies employed by food companies affect consumer choices and ultimately impact individual and public health. The analysis should consider various aspects, such as advertising techniques, product placement, and the portrayal of food in media. Students are expected to draw upon relevant academic literature and research findings to support their arguments.

MARKETS AND MARKETING

Table of Contents
Introduction................................................................................................................................1
Task 1: Marketing Analysis.......................................................................................................1
Task 2: Understanding Modern Marketing................................................................................3
2.1 Concept of modern marketing environment....................................................................3
2.2 Challenges in modern marketing.....................................................................................4
2.3 Nestlé’s approach to modern marketing..........................................................................6
Task 3: Strategic Recommendations..........................................................................................7
3.1 Scope for Improvement....................................................................................................7
3.2 Recommendations for improving current approach to marketing...................................7
Conclusion..................................................................................................................................7
REFERENCES...........................................................................................................................1

Introduction
In today’s world, everyone is either a consumer or a part of marketing process.
Marketing is the managerial process to develop and maintain a strategic fit between the
organisation’s objectives, skills and resources and its changing market opportunities. The aim
of marketing strategy is to shape the company’s business and products so that they yield
targeted profit growth. This paper focuses on the Nestlé’s marketing approach. It starts with
analysing the current position of Nestle by carrying out the strategic audit. A PESTLE
analysis is used to identify internal and external environment and the strategic alternatives
that can be applied by the Nestle. Further, the paper has come out with the recommendation
measures to help the company’s future growth.
Task 1: Marketing Analysis
An organization’s marketing environment refers to the factors outside the marketing
functions that affect the marketing decisions of the company. The analysis of marketing
environment provides it with opportunities and threats. Nestle should understand the
importance of utilizing research and intelligence efforts to analyse and effectively respond to
the changing environment (Macdonald, 2012). The marketing environment of Nestle involves
both micro-environmental and macro-environmental factors which are discussed in
subsequent sections.
SWOT Analysis
Strengths
 Highly diversified business
 Variety of brands serves in different
market segments
 Well-established relations with powerful
brands, like General Mills, Colgate
Palmolive and Coca-Cola
 Owns world’s most trusted and
recognized brands
 Strong capabilities of research and
development
 Strong relations with retailers
Weaknesses
 Much of sales depend on some well-
recognized brands
 Grocery sales in some main markets are
concentrated in few big retailers like
Tesco in UK and Walmart in US. These
firms have capability to force reduction
in Nestle price
 Some brands of Nestle are considered as
old-fashioned by modern customers
 The company is dependent heavily on
advertising to drive traditional sales and
shape customers opinion, which lead to
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high costs of marketing
 There is high cost to launch new brands
for supplementing less-fashionable and
older food products
Opportunities
 Online retail growth can open up new
channels of distribution, like Amazon
Prime that can evade traditional retailers
 Developing middle classes in India and
China create broader and larger markets
for Nestle
 Increased disposable income in China
can enhance luxury items demand like
pet food, ice cream and bottled water
 Changes in lifestyle and more females
workforce plus single households
increase the pre-packaged foods demand
 Increased interest in nutrition and health
can enhance demand of Nestle energy
drinks
Threats
 Retailers like Kroger, Walmart and Aldi
are increasingly promoting home brands
 There is pressure to cut prices from big
retailers
 The increasing use of new retailers like
dollar stores and Amazon Prime may not
favour traditional products of retailers
 Trends in some nations to eat out from
home that means less demand for some
products of Nestle
 Increasing suspicion of pre-packaged
food as unhealthy and unnatural
 Possibility of increased regulations and
oversight of government in some
markets
PESTLE Analysis
Political factors
Baby milk of Nestle can be influenced by changes in politics, i.e. political changes can
impact on funding arrangements and public priorities. The company has to comply with laws
defined by parliament and due to this it depends on political concerns. A vital role is played
by government by imposing regulation and law on the organizations. Nestle is trying to meet
standard laws decided by government (Dalton, 2011). For instance, Nestle is attempting to
comply with disability act, health and safety act, etc. Moreover, government regulation and
laws in accounting standards, taxation requirements, comprising new tax laws, tax rate
changes, and revised tax law interpretations are heavily influence business operations of
Nestle.
Economic factors
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Nestle is requires to have enough information about different regions economic growth
rate, inflation rate and per capita income of person, where they are willing to start its business
activities. Conditions of economy varied from one nation to another, which should be
considered by organization before setting corporate goals (Nestle, 2013).
Social factors
Cultural or social environment has great influence on Nestle. The social change
includes changes in lifestyles and attitudes of people. Different countries follow different
cultures and have their unique lifestyle and tastes. Nestle has to create strategies for meeting
such changed lifestyles of target customers. Moreover, the services or products of Nestle
cannot be successful until it has enough information about life style of customers. The
company has to consider social and cultural aspects of every country for attaining their
business goals over there (Slovic, Flynn and Kunreuther, 2013).
Technological factors
The particular factor has most persistent, rapid and profound influence on the Nestle. It
creates opportunities for new products development, product improvements and new
techniques of marketing, i.e. e-commerce. In this regards, Nestle is selling products online
and advertising through social media channels.
Legal factors
These are in relation to company’s legal environment and influence its cost and
demand. For instance, Nestle have to provide health and safety facilities to its members. The
company in this relation pay their members compensation through the scheme of free legal
help in case of injury (Lorange, 2005).
Environmental factors
The large companies have to be socially responsible to environment and localities
where it performs its business activities. Due to this, the Nestle is committed to environment
sustainability and fulfil its all corporate social responsibility by preserving energy and natural
resources. In this manner, the Nestle is also able to produce green products and gaining loyal
base of customers (Nestlé Corporate Business Principles, 2004).
Task 2: Understanding Modern Marketing
2.1 Concept of modern marketing environment
From the business perspective, marketing is referred to as an exchange process
involving seller provide something valuable for buyers. The concept of modern marketing
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deals with customer satisfaction to keep current customers and creating value to attract new
customers. There are three basic objectives of the marketing concept: customer focus,
coordination of marketing mix elements and profit orientation (Köse, 2007). The
understanding of market environment, customers and brand positioning plays prominent role
in developing modern marketing strategy. Furthermore, digital thinking has become soul of
modern marketing efforts. Digital channels allow marketers to utilize customer knowledge
effectively and helps in optimising the interactions. For example, the various customer
parameters like device type and make, screen size, usage characteristics, location, etc.
provide strong and encouraging data points to influence personalisation. Personalisation
provides the greatest opportunity for marketers to offer more relevant services for customers
(Unger, 2016).
The most observed trend in modern marketing is increase in social advertising with an
increased focus on monetizing social platform of interaction. The rise of social media also
become fundamental influencer for buying decisions and marketers need to consider its
opportunity for the same. Another trend to watch for is increasing user generated content
where marketers leverage their existing customer base to boost marketing campaign for their
products. Personalized offerings and relevant services is another trend of modern marketing
with the huge availability of customer data points. Finally, with the increased availability of
marketing analytics, marketers are empowered with data-driven decisions. The consumer
buying decision has become more complex due to extensive use of technology and digital
media (Moth, 2013).
2.2 Challenges in modern marketing
The dynamic global environment has significant effect on a firm’s marketing planning.
Apart from globalization, recent technological advancements also has positive effects like
creating new business opportunities as well as pose threats for the need for re-look at
marketing strategy of the firm. The most common marketing challenges that are required to
be considered by marketers are – rapid globalization, changes in world economy, modern
development in information technology, increased concerns for moral and social
responsibilities, and management of multichannel strategy for integrated marketing
communication.
Globalization: The emergence of globalization is considered as the most remarkable change
in recent years for marketers. For example, European firms are now facing fierce competition
from many Asian and Japanese MNCs like Samsung, Toyota, Honda and Sony in domestic
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market. On the other hand western counterparts like IKEA, Coca-Cola, Walmart, McDonalds
and Thomas Cook have created many opportunities in Asian markets. It has resulted in more
complex structure of marketing environment for companies (Krafft, 2015). The international
market opportunities comes with a great challenge for companies to streamline their
marketing efforts. Common challenges include international trade policies, economic
environment for exporting and importing materials, cultural diversity and intra-national
relationships corresponding to political-legal environment. Firms are required to have
different organisational structure and develop appropriate strategy for whether to standardise
or localise. Furthermore, international expansion can bring big challenge for marketers to
effectively develop marketing content to appeal global audience (Kinra and Kotzab, 2008).
Information Technology Developments: The volatile advancements in information
technology, telecommunication infrastructure and advent of internet has significant impact on
modern marketing concept. On one hand it has created innovative ways for marketers to
develop customer knowledge, on the other hand it also pose serious challenges involving
security issues, leak of information to competitors, and growing expectations of consumers.
The biggest challenge for marketers is to find right kind of technology as per their
requirement as there are many tools and software available to choose from to solve a specific
marketing problem. Moreover, millions of webpages offers huge volume of information and
marketers face a big challenge to minimise frequent swing of customers and to keep and
engage them (Babatunde and Adebisi, 2012).
Economic fluctuations: Frequent changes in world economy bring challenges for marketers in
form of declining demand and limited growth opportunity. Consequently customers have
become more demanding and value for money has emerged as biggest concern as well as
opportunity for companies. Measuring the return on investment for marketing efforts has
become the most important thing to consider. Sales and marketing must closely link up to
have shared accountability. Marketers also need to understand the nature of cost and
competition for which they should be responsible (Faith and et.al., 2007).
Moral and Social responsibilities: Corporate ethics have become more important in recent
years and companies must take environmental and social accountability in its marketing
efforts. Stricter demands and regulations have created additional pressure on companies.
Modern marketing should consider tougher environmental and ethical guidelines. Moreover
stiffer penalties for unethical marketing practices have also resulted in more challenges for
marketers (Cova and Dalli, 2009).
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Multichannel communication strategy: The development and implementation of an effective
multichannel strategy is an important challenge for modern marketers, but it also provide
huge rewards if can be managed properly. An adequate integration of various offline and
online channels are required for improving effectiveness of channel sales. Modern marketing
must be connected and integrated in accordance to customer needs (Hoek and McLean,
2010).
2.3 Nestlé’s approach to modern marketing
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. Long-term potential is never sacrificed for short-term
performance. The Company's priority is to bring the best and most relevant products to
people, wherever they are, whatever their needs, throughout their lives (Ahmed and Rafiq,
2003).
Nestlé have a worldwide Nestlé Consumer Services network devoted to caring for
consumers because its success depends on meeting the needs and expectations of customers.
With all marketing communication centred on its logo “Good Food, Good Life”, it is striving
to provide the quality food and then good healthy life to customers. Backed up by the best
possible product quality and food safety standards, Nestlé endorses consumer well-being and
health while following the local traditions with regard to cultural preference and taste. The
organisational objective is to ensure quality nutrition, and consumer’s increasing expectations
are met, at the same time they prevent illness as per the traditional concerns of convenience
and pleasure. The global philosophy of Nestle i.e. the commitment to excellence in product
safety and quality and to provide value for money to its consumers (Amsaveni and Gomathi,
2013).
Moreover, Nestle maintain the commitment to respect and abide by all applicable legal
and ethical responsibility in each of the markets. Nestlé is also committed to a green
environment and it is essential to sustain their growth as the leading nutrition health and
wellness brand. Their corporate policy includes objectives of being the most efficient water
and energy user among food manufacturers. Lower greenhouse gas emissions from its
manufacturing, and optimum utilization of natural resources by conserving electricity are part
of their social responsibilities (Baker, 2000).
Rising consumer demands have provoked consumers to concern about healthy food and
Nestlé’s has effective global strategy to tape this particular market. From modern marketing
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perspective, Nestle utilizes the integrated marketing communication system. All of its
promotional efforts are well coordinated using several platforms like social media, website,
offline communication to make an effective impact on the customer mind and to deliver a
consist message (Rowley, 2001).
Task 3: Strategic Recommendations
3.1 Scope for Improvement
The above analysis of Nestlé’s global marketing strategy seems good at first glance, but
there is always room for improvement. Nestle offers impulse products and the fundamental
requirement for success in this industry is convenience, i.e. availability of products whenever
and wherever consumers want. Therefore, there is still vast opportunities to tape potential
consumers by improvement in sales channels and logistics to cover the wide market of 130
countries where Nestle is operating. Another area, where scope of improvement lies that to
have a strong understanding of technology. Nestlé must understand the emerging technology
and its applications for recognise potential opportunities both in product improvement and
marketing communications. Continuous improvement in consumer understandings should be
deal with innovative products by employing technology (Keller, 2009).
3.2 Recommendations for improving current approach to marketing
Nestle must strive for continuous improvement in modern marketing. Nestlé should
look into improving the strength and deal with the weakness pertaining to the main objective
of nutrition strategy. For example, Nestlé’s accusation of not using the quality breast milk in
their products in developing countries was a serious concern. It is recommended that Nestle
should standardise the strategy of providing nutrition, health, and wellness for all countries
despite the nature of country. Another recommendation include to invest in R&D for looking
into the organic foods market. On one hand it will reflect on Nestlé's main objective of
providing products for the wellness and health as well as the industry is in its initial phase
with great potential for growth in near future. Also to gain better consumer engagements,
Nestle is recommended to invest more in building the public image as a corporately
responsible company by utilizing social media (Fırat and Dholakia, 2006).
Conclusion
The marketing concept emphasizes on coordinated effort to satisfy costumer’s needs in
profitable way. Marketers are striving hard to create long-term relationships with customers
and building strong global brand. Nestlé has already established the business at global level
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and it is expanding by increasing food brands. Nestle must plan and make decision
considering the today’s complex and constantly changing environment. Nestlé’s key success
factor would be the well-thought out product range and effective marketing communication
strategy in global settings. Despite of fierce completion, Nestlé would be able to maintain its
competitive advantage with the current market conditions on improving on their weaknesses
as per the recommended strategy.
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