Strategic Marketing Plan for Nestle

This strategic marketing plan analyzes the macro trend environment using PESTLE analysis, identifies threats and opportunities, and discusses market segmentation and internal analysis using McKinsey's 7S framework for Nestle.

Strategic marketing
Plan

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK1.............................................................................................................................................1
Q.1. Analysation of macro trend environment on the basis of PESTLE analysis and
presentation of threat as well as opportunities along with their impact.....................................1
Q.2. Diversification of market segment.......................................................................................4
Q.3. Internal analysis with application of McKinsey's 7S framework........................................5
TASK 2............................................................................................................................................6
Q.4. SWOT Analysis of Nestle....................................................................................................6
Q.5. Explain SMART Objectives of organisation.......................................................................7
Q.6. Explain the manner how opportunities are grasp and threat are tackle...............................8
Q.7. 7 P's of Marketing are explain in detail in below mention points as these are as follow....8
CONCLUSION................................................................................................................................9
REFERENCE...................................................................................................................................9

INTRODUCTION
In strategic marketing plan various steps are to be perform in first step goals and
objectives are set up secondly internal as well as outside factors are to be analyse. In next step
product planning is to be done. The main purpose of the assignment is to prepare and analyse the
market plan so that organisation can easily achieve the objectives by implementing the plan.
Then implement the plan in a systematic manner and at last performance is analysed. Marketing
plan is futuristic approach according to Philip Kotler and it is made for long term. (Abratt,
2018)The company that was selected in this report is Nestle. In terms of other metrics and
revenue it is in the largest position in food industry in the world. It deal with various product like
breakfast cereal, confectionery, dairy product, baby food, bottle water, ice creams, medical food,
snacks, frozen food, pet foods etc. The reason to select this organisation is that it is fast growing
and most reputed company so it is to be choose. It have various famous Brands like magii, kit
kat, smarties, nescafe. It is the largest food and beverage company. The main mission of Nestle is
to provide good food for good life by providing best tasting and nutritious items in huge varieties
of food and beverage categories. Vision of Nestle is “To be leading, nutritious, competitive,
health and wellness Company improve shareholders value by being preferred employer,
corporate citizen, preferred supplier with promote selling preferred product” (Mission & Vision
of Nestle. 2019). Due to COVID 19 many challenges are face by the organisation. Finding the
way of sourcing raw material and packaging are the main problem that was faced by the
company. Threat of new entrants is the major challenge face because competitor provide similar
product at low prices as compare to nestle. High prices of raw food is another challenge as due to
increase in price of raw food produce the cost of production of nestle is also increase. By this
price of nestle product increase that tends to decrease the demand of that item as it makes
negative impact on sales also. Other challenges are, manage and survive in the situation of
scarcity of water.
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TASK1
Q.1. Analysation of macro trend environment on the basis of PESTLE analysis and presentation
of threat as well as opportunities along with their impact.
Macro environment is the condition that exist in the economy as a whole, rather than in a
particular region. Various element are included in the environment are money policy, gross
domestic product, inflation, spending, fiscal policy etc. (Baker, 2016)
Macro include different forces that are explain in detail in below mention point as these
are as follows:
Political factor: It includes different elements like tax policy, regulation and
deregulation trend, level of corruption, change in political environment etc. Tax rate in UK is
high as high penal provisions are attracted if there is any default created related to payment of
taxation so it is a great threat that was faced by nestle (Nguyen, 2016).
Threat: Rapid change in tax rate is the most common threat face by Nestle. Due to high
taxation rate large part of revenue are paid as tax to government. By paying tax on time with
deducting proper amount as according to rate nestle avoid penal attraction. It also create good
image of company because company does not play a role of defaulter in tax payment manner.
Economic factor: It include stage of business cycle, inflation, Gross domestic product,
exchange rate, interest rate, unemployment rate, economic growth etc. (Chanavat, 2017)
Threat: Due to high inflation rate in UK, cost of product increase because raw material
are available at high prices so ultimately finished product become costly. It is great threat that
was face by nestle because due to high prices people try to avoid to purchase costly product and
diversify towards low cost competitors product. It makes negative impact on sales as well as on
profitability also. To survive in the market, unnecessary expenses are deleted by nestle so that
they can reduce ultimate cost and attract large customers.
Social factor:It is related to age distribution, cultural barrier, lifestyle attitude, safety
emphasise and population growth rate (Vellas, 2016) .
Opportunities: As nestle supply their products in many different countries in different
stores so it require large human assets so that organisation work in proper flow. As huge
employees work under one roof, so ideas and views of persons of different religion and culture
are exchange and taken to make smart strategy for business expansion because every person has
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different perception. It gives great opportunity to businesses to introduce new product in
different locations.
Technological factor: In involves technological awareness, automation, level of
innovation etc. (Dib, 2016)
Opportunity: By introducing new machines and software it leads towards direction of
growth. Creating technological awareness among employees nestle help their workforce to adopt
new method of performing task. It gives great opportunity to business to implement innovative
ideas by using smart technologies. As technology help to work fast without any wastage so it is a
great opportunity for nestle to grow their business in terms of sales and revenue by adopting
smart technology. Resources are valuable in UK in terms of advance technology such as artificial
intelligence, equipments easily available. Research and development information can easily
grasp by the company.
Legal factor: It include discrimination law, competition act, consumer protection act,
labour law, health and safety law, patent and copyright law, employment law etc. (Mahoney,
2016)
Threat: Introduction of new provision in the law is great threat that face by nestle
because every law has great restrictions. High penalties and punishments are attracted in UK if
any default is done by organisation regarding any law. To mitigate these threat nestle work by
following consumer protection act and appoint legal officer who handle all applicable relevant
provisions to avoid penal punishments. If legal laws are not followed in proper manner than it is
going to result into causing legal issue to Nestle which impacts their market position in negative
manner.
Environmental factor: The factor that cover in this are climate change, weather,
environmental policies(Sahaf, 2019).
Threat: There is always a threat of natural disaster that face by nestle because due to
unpredictable climatic and weather change make negative impact on sales of company because
people suffer from heavy looses. So it is difficult for public to purchase goods as it reduce sale of
the company. By providing discounts and offers nestle can increase their sale and revenue at the
time of natural disaster.
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Micro environment: It involves agencies, individual, group who are in direct contact
with organisation at the time of performing business function. The elements of micro
environment are supplier, competitor, intermediaries, media, employees, shareholder. Micro
environment can be define with the help of using five forces.
Bargaining power of customer: customer play an important role in every business
because they are end user of product so they are the only person who create or destroy the
market. As customer generally make focus on bargaining. By giving discounts and warranty
nestle diversify the interest of their customers towards their product. Some external factors also
effect the market. In Nestle, bargaining power is high in respective of customers because large
number of competitor are their in the market to customers. As New strategies should be
introduce by Nestle to eliminate the threats of bargaining power (Sahaf, 2019).
Bargaining power of supplier: As raw material and other components make available to
produce the goods with the help of suppliers only. There are many suppliers who supply goods in
less affordable prices. If bargaining pressure are face by supplier. They can increase their product
price to earn their profit margin. The bargaining power of supplier is high in Nestle because large
number of suppliers are there in the market as there are huge companies that are deal with similar
product.
Potential entry of new competitor: To increase the competition in the market direct
entry is permitted. It is helpful as per customer perspective because it gives choices to customers
to select the best available option. As potential entry of new competitor is high because nestle
has various competitors that have good brand image.
competitive rivalry: It is the competition among competitor working at the same level.
Rival competition is high if only few items are available for sale. Price war begins when rivalry
competition starts. As nestle deal in food industry so intense competition is face by the company.
P&G, craft foods and Group Donane are some of their competitors. As nestle have large
experience of facing competition with these well establish brands. To launch product in the
market huge amount is spent by these brands in promotion and advertisement activities. So the c
competitive rivalry face by Nestle is high.
Substitute product: As various cheap and affordable substitute are available in the
market. As there are large number of competitors who offer large variety of substitute that give
same satisfaction to their customers. Substitute are available at low price that makes negative
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impact on sales of Nestle. Because people interested to buy low price product so it make
negative effect on profit also. Nestle face less substantial related to substitute product.
Q.2. Diversification of market segment
Market segmentation: It is a process in which market is divide into various small
categories. In this audience and group are divide into different segments on the basis of their
similarity.(Chernev, 2020)
Customer segmentation are done on the basis of various factor such are as follows:
Demographic force: People are the base of this force. In this deep study of human
population is done on the basis of size, gender, age, density, statistics and occupation. For new
born baby and small children Nestle divide their market segment by offering different product
like Koko crunch, Cerelac, Nido etc.
Geographic: As per geographic whether Nestle divide the market segment. Nestle by
introducing the product “coffee” give satisfaction to their customers as it bring freshness in the
body in hot and cold climate (Percy, 2016).
Psychographic: Nestle provide KIT KAT to those who love to eat chocolates. It also
provide “nescafe” coffee to give relax to consumers. Customers can save their time by
considering nescafe as 3 in 1 because in this all the essential items coffee, sugar, milk are mixed
as customer can take the benefit of all three items at the same time (Sahaf, M. A., 2019).
Behaiviour: Nestle capture the market by providing the product for small children as it
give nourishment to small babies. Nestle provide cerelac which is a mixture of milk and rice with
sufficient minerals, nutrients etc. As large number of public depend on this reliable product for
their small child.
Threat and opportunities that are face by nestle in their business environment.
Change in consumer behaiviour and lifestyle increase the demand of instant tea, coffee
and prepackaged food because due to long hours of working customer love to drink something
that give relief from stress. So Nestle has great opportunity to expand business and attract huge
customers by offering packaging food and instant tea powder because most of the population are
working in UK. Increased disposable income also increase the needs for luxury products for
example purified bottle water, ice creams etc. so nestle has great opportunity to provide variety
of flavours in ice creams and increase profit rate by capturing large market area.
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There is a great threat of price rising of coffee beans due to climatic change and natural
disaster are faced by nestle. As due to this final cost of item are also increase that makes negative
impact on nescafe sales because people prefer to purchase substitute items at low prices. Entry of
new competitors in food industry also a threat that face by company as it diversify their
customers towards different brands and affects the sale negatively.
Various other challenges are retirement and superannuation as most of the top positions
are vacant due to age factor. To fill the suitable vacancy, regular recruitment process is follow in
the organisation. To find the right person at the right time is the major problem face by company.
And the new vacant position is fill by unskilled persons who do not have any experience as it
create problem so it is the big challenge face by company to make arrangement of training
session. Because nestle tend to maintain standard in their workplace
Q.3. Internal analysis with application of McKinsey's 7S framework
Mckinsey's 7's
Strategy: Nestle use strategy of introduce new basic product in market more early than
their competitors so it develop trust of people in their respective food brands.
Structure: Hierarchical structure is followed by nestle to increase operational
productivity as it provide clarity to employees to know what task they need to perform to achieve
the set goals.
System: As inter organisational system is follow by Nestle because it help the company
to know more about their market.(Kaiser, 2018)
Shared values: For successful business there is need to set some value not only for
shareholder prospects but for society also. Nestle set their business principles after fulfilling all
the compliance and laws. It ensure that their actions are economically viable and socially just.
Style: It represent the manner of managing their staff by performing different actions.
Comprehensive leadership style is adopted by Nestle to run business effectively.
Staff: As nestle give opportunities to local people of domestic countries to work in the
organisation. As it is a big brand, deal with large variety of product so there is need to appoint
large number of employees in the company. There are around 200000 employees are working all
over the world.
Skills: Nestle select experience and professional candidates for product marketing so that
company can easily grow their business with the help of smart strategies and knowledge.
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TASK 2
Q.4. SWOT Analysis of Nestle
SWOT Analysis is defined as an activity of identifying strength, weaknesses,
Opportunities and Threats so as to assist management of an organisation to make corrective
actions for future development (SWOT Analysis of Nestle).
STRENGTH WEAKNESS
 Nestle is the most reputed brand as
large number of people rely that it offer
quality product in food and beverage
industry.
 It deal with large series of product
portfolio. Nestle provide around 2500
product having large number of
specialised brand and capture the huge
market segment.
 Fluctuation in the prices by retail giants
as nestle deal in food products so with
increase and decrease in the price due
to natural calamities or change in
climatic conditions it make impact on
sales also.
 As controversy related to Maggie
decrease the image of brand as question
arise regarding their ingredients and
quality. It reduce sales and loss around
85% of market share globally.
OPPORTUNITIES THREAT
 Nestle has great opportunity to
introduce new product for breakfast
cereals. As brand already create a good
image in the minds of customers so it
take advantage of that by launching
new products. As it gives surety that
people like new product.
 Nestle has excellent opportunity to
provide small food packets. For this it
can do collaboration with reputed
company. In this way brand expand
their business.
 Threat of entry of new competitors are
always face by Nestle because many
brands offer similar products with low
prices so chances of loosing customers
are increase. As makes negative impact
on sales as well as on revenue.
 Unfavourable change in government
regulation make negative impact on
business. Increase price of commodities
force company to raise the cost of its
product that tends to reduce sales.
Because it distract customers toward
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other brands that offer product at low
prices.
Q.5. Explain SMART Objectives of organisation
Objectives are segment of every aspect of business with the help of directing, motivating,
focusing and with clearing importance it can easily achieve. By providing training and
conducting personality development programme, company make their marketing persons smart.
As they learn good strategies of convincing customers so that they show interest in their product
brands. In this way company create large customer base of different age group. Door to door
marketing for the product are also another way of sales raising.
SMART OBJECTIVES
 SPECIFIC Nestle set objective to increase their customer
base and sale for their different product brand.
 MEASURABLE Performance should be measure on the basis of
Bench marking and KPI.
 ACHEIVABLE By providing gift vouchers, discounts,
complementary goods , marketers attract huge
customer that leads to increase sales with
expanding customer base.
 REALISTIC If the set targets easily achieve by company it
can help to create good brand image in market.
 TIMED The set target of the company must be
achieved in next 4 month of this year.
Implementation of plan to achieve set targets:
The organisation use pull and push strategy at the time of performing planned activity.
By adopting various different channels of advertising company can easily achieve the set targets.
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Above the Line: With the help of mass media nestle easily create their market and attract huge
number of employees.
Below the Line: Putting hoardings near roadside and with the help of social media organisation
create market base.
Mass marketing: To increase the volume of sales mass marketing is used if the whole market is
communicate the same product.(Proctor, 2020)
Q.6. Explain the manner how opportunities are grasp and threat are tackle.
Nestle has great opportunity to introduce and promote their product by using online
shopping platform. It help to save the time of customers. Threat of competition are face by organ
isation. To tackle the threat nestle offer products at different sizes so that every individual can
afford the product.(Hollensen, 2019)
Q.7. 7 P's of Marketing are explain in detail in below mention points as these are as follow
Product: Nestle provide huge variety of quality product like chocolates, coffee, noodles
etc. Kitkat, Maggie, Nescafe are some top brands of Nestle.
Price: Cost are differ for each product. Nestle offer their items with same taste and
quality with less prices also so that every person easily purchase the product and satisfy their
desire.
Place: Nestle make available their product in grocery shops and on supermarkets in
different location of countries. The brand manage their own sales and distribution network all
over the world to supply their product.
Promotion: By using smart tag line for different product it help the customer to easily
recognise the items. As Nestle by giving advertisement on Television, newspapers, radios
promote their product.
People: Nestle make products for different age groups like cerelac, milkpowder for
small babies, maggie and noodles for youngsters, coffee for working individuals. In this way it
attract large number of people having different age group. (Percy, 2016)
Process: By adopting better technology company manufacture their product. Nestle also
make arrangement of skilled labours so that brand work with easy flow by using effective
process.
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Physical evidence: By setting up different coffee corners at various location having logo
of nescafe in vending machines, Nescafe make good connectivity to their customers.
CONCLUSION
After doing deep analysation and study of this assignment it is to be concluded that to run
business effectively it is necessary for every organisation to made a smart strategic plan to
achieve the goals of the company. Also there is need for effective segmentation so that activity
can be perform properly. By following different strategies and policies Nestle increase their
revenue and sales. With providing good quality product in different weight and sizes the brand
imprints excellent image in the mind of consumers that leads to business expansion and growth.
By providing huge variety of products like milk powder, chocolate, noodles, oats, coffee the
brand satisfy the needs of many end users. To create awareness in the market about their product
organisation adopt various promotional campaigns like social media, newspapers, magazines,
television etc. It also conclude that every business whether it is well establish or not they must
face challenges and threat at every steps of business. Great opportunities are make available to
companies. By grasping these opportunities any company can grow their business by increasing
sales and survive in the market for long term.
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REFERENCES
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Online
An Overview of Nestle. 2019. [Online]. Available through:
<https://www.nestle.in/aboutus/anoverview>
Mission & Vision of Nestle. 2019. [Online]. Available through:
<https://www.nestle-esar.com/aboutus/missionvision>
SWOT Analysis of Nestle. 2019. [Online]. Available through:
<https://www.marketing91.com/swot-analysis-of-nestle/>
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