Marketing Fundamentals Report: Nestle's Strategies and Analysis

This report provides a comprehensive analysis of Nestle's marketing strategies, encompassing the processes and stages of marketing, with a focus on the marketing mix. It delves into Nestle's mission statement, situational analysis, including SWOT and Porter's Five Forces, to understand the competitive landscape and internal strengths and weaknesses. The report also examines Nestle's market segmentation, targeting, and positioning strategies, illustrating how the company caters to diverse customer segments. Furthermore, it explores stakeholder engagement and impact, considering both internal and external stakeholders. The report concludes with a discussion of the implementation and control mechanisms employed by Nestle to ensure effective marketing performance. This analysis is valuable for understanding how a global food and beverage company navigates the complexities of the market.

Marketing fundamentals-2

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
1 Processes and stages of marketing including the role of marketing mix..................................3
2. Stakeholder engagement and impact.....................................................................................10
CONCLUSION..............................................................................................................................13
REFERENCES................................................................................................................................1

INTRODUCTION
Marketing is the strategies which is used by the company to promote their goods and
services. Every marketing activity is carried by the marketing team. Digital marketing is
evaluating nowadays. More and more companies are adopting this for their marketing work.
Nestle is the Switzerland based multinational company. It is the food and drink company and
also the largest company in the world under this segment. Its product range include snacks, baby
food, water, medical etc. this report will discuss the process and stages of the marketing mix.
Understanding of company's pestle analysis. Segmentation, targeting and positioning are also
discussed. Complete understanding of stakeholders and along with the external and internal
stakeholders.
MAIN BODY
1 Processes and stages of marketing including the role of marketing mix
Define marketing
Marketing is the process which is used by the company when they are doing their promotional
activity like the buying and selling of the products and services in the market (Esty and Fisher,
2019). The process involves advertisement, promotions, selling and making sure by the company
that goods are reaching towards the customers.
Define marketing process
If the company want to reach towards their target audience then they should identify the
problems, marketing opportunities and marketing models which has to be their so that company
can generate high profits and sustainability in the market.

Mission statement
The mission statement of nestle is “ goof future, good life” to provide consumers the best tasting,
most nutritious choices in a wide range of food and beverage categories and eating occasions,
from morning to night.
Situational analysis
Swot analysis:it is the framework which is done to analyse the internal environment of the
company.
Strengths:
Nestle is the multinational company which is known worldwide. It is the most reputed brand. It
provides high quality of goods which attract large customer towards the company (Nadube and
Didia, 2018). It has adopted effective branding strategies which is enough to create the
awareness for the brand globally. Nestle has covered many large markets of the developed and of
the developing countries so that they can earn more revenue from that, the company is not stick
to particular markets only it has wide market approach. It is successful in targeting large market
value. It has wide product portfolio near about 8000 or more variety of products. The company is
having the most known brands which include kitkat, Maggie, Gerber etc. they are also having
good relationships with other big companies. It has strong research and development team which
help them to achieve the competitive advantages. They also have strong distribution channels.
Weaknesses:
Illustration 1: Marketing process
Source: MARKETING PROCESS, 2016

Nestle get their sales from the big retail companies like Walmart, Tesco etc. if these retail stores
do price fluctuations like increasing or decreasing the prices then it will affect the sales and
profits of nestle. The company is having large organisational structure under that they have many
brands which is the challenge in managing of the brands which ofens create issues. The water
controversy of the company is the another weakness. The company also have to face social
criticisms, they are target by the media many times in the label misleading case, child labour case
etc. which hurt the reputation of the company. The Maggie noodles controversy which was there
in India in which the lead content was found and in that country the company has lost the
majority of market share in that year.
Opportunities:
Venturing is the opportunity for the company. They can even do partnership with the small food
start up companies so that they can do promotion of the company. Nestle can increase their sales
through online shopping platforms because E commerce is on boom these days so company can
take advantage of this. Online shopping is the more convenient and comfortable shopping
experience (Braimah Bulley and Anore, 2017). Nestle should also promote shopping through
their website which will increase the sales and facilitates company's promotion. Company should
work on the products like ready to drink beverages. This is very trending and consumers now are
demanding ready to drink coffee or tea. To gain the trust of the customers the company should
work on their labelling and avoid giving false information.
Threats:
The rising of the competition is the threat for the company because company like Unilever is also
offering same goods to the customers, and they are also easily available to them. As the company
is operating worldwide so the different government have different regulations which can affect
the operations of the company. If there is rise in the commodity prices then company will also
increase the price of their products which will cut down their sales.
Objectives
 Nestle want to increase the market share by 20% by the end of 2021.
 The company want to increase the number of customers in the developing countries. To increase the overall revenue by 15% in the period of one year.
Strategy
Porters 5 forces

Porters five forces is the tool which is used to identify the competition of the company and also
helps in determining the strengths and weaknesses of the company. The five forces are:
competitive rivalry:
Nestle comes under food industry segment which faces massive competition. The competitors of
the company are Kraft. Unilever, P&G etc (Varma and Ravi, 2017). in the breakfast segment the
company is facing intense competition form Kellogg's company which are also provided
cornflakes and other breakfast cereals. The company is not facing competition is the pricing but
also facing competition in the variety of products. Their rival brands are doing good promotional
tactics to attract consumers. Their market share is in danger so the competitive rivalry of the
company is high.
Threat of new entrants:
It is very tough for the new company to enter the food market as it is the diverse industry. It has
high entry barriers. This segment has big companies which are already having large market
segment who have good experience, and they very well know the needs and demands of the
customers. The company have high customer loyalty which they had built with the time. As it is
the food industry so it seems easily to enter so many new companies enter this industry every
year but only very few companies get success. The distribution channels or system of the
company is strong which help the company in providing goods at low costs and also achieving
the economies of scale.
Bargaining power of suppliers:
Nestle is the big company so it requires many suppliers. The suppliers of the company are very
happy with the company as the company orders in bulk. As a result the supplier of the company
never or rarely bargain with the company regarding the prices. The company take care of their
suppliers, they assure that the suppliers are satisfied. They have good relationships with them and
always want them to supply good quality of products. The company do not change their suppliers
easily because if they does that then they have to enter into new contracts with them.
Bargaining power of buyers:
The buyer's bargaining power is very high because many companies are available in the market
which offers the identical products. So customer can easily switch to another brand. If their
competitors lowers the price then it will affect the sales of the company because customer get

attracted towards low price goods. Nestle knows that the buyer have the power, so they make
sure that they always satisfy the customers by providing good customer services to them.
Threat of substitutes:
The substitution of the company is very high in the products like bottled water and milk, baby
foods etc. there is the controversy for the company that it some products are not fit for the
consumption which give advantage to the substitutes companies in increasing their sales
(Ahmed, 2020). Nestle have to regular come up with the innovative products so that they can
hold their market share and threat of substitution also becomes less.
Implementation and control
Company should make lot of changes which influence the performance. Nestle should take
timely feedbacks form their employees and customers so the company can know that where there
is the need for the improvement. The company should monitor the performances of their
employees so that they do not get affected from the internal and external environment. Company
should provide good working environment to their workforce so that they get motivated to work
which will increase their productivity and eventually revenue of the business.
Segmentation, targeting and positioning
Segmentation:
Market segmentation includes people who are following the same brand. There are different
types of market segmentation which are one-to-one marketing, niche marketing, mass marketing
etc. in the mass marketing every customer get same treatment. One to one marketing is dealing
with the individual customer and niche marketing focus on particular areas. Its is base on
demographic, geographic and psychographic. In Singapore the company has segmented the
market for the nescafe brand which is based on the weather of the country. The company
consider the culture and region of the country before launching products. Company is expert in
identifying the needs and wants of the customers of different region. The demographic is based
on the gender, age, income, interest etc. nestle manufactures products for different age group like
they make flavoured milk powder for kids and coffee for adults. The company also make
products according to the lifestyle of the people. The company manufactures high price goods
and low prices goods so that the person can buy according to the income of them.
Targeting:

After the customer is segmented now the time has come to target them. Targeting means
selection of the customers whom the company want to target. Here company analysed their
strength in which they are good, so they start serving the customers to make them happy and to
gain loyal customers and increase the profitability of the company (Lotfifard and Borojerdi,
2018). Differentiated marketing strategy is chosen by the company where company is able to
provide different products to the different customers based on the age, income, gender,
occupation etc. for example the company having different coffee which can be consumed on the
basis of taste of the customer or climate of the region. Company make advertisement according
to the targeted audience.
Positioning:
It is the process to identify the position of the company in the market and what are the views of
the company have by customers like on what position they think that the company is. Once the
company come to know that where it is then they can make strategies about the future where
they want to be. Company can apply the marketing mix to know this. For the target customer
they manufacture different products which depends on the needs of the targeted audience. The
distribution channel of the nestle is very smooth they have very efficient salesperson and have
good transportation facility through which products reach on time to the customers. The brand
nestle is soo famous that it is easily identified by the customers. They offer good quality of
services to their customers. They have the customer care number from which the customer can
call anytime and solve their queries.
Marketing mix
Product:
Nestle have wide products portfolio. Nescafe, a coffee brand is the most popular brand of the
company which comes under beverages (Ogedengbe, 2017). Along with coffee the company also
offers tea in the name of nestea. Their products range also include milk products which includes
nestle everyday and milk maid. With the growing demand of the people for less time-consuming
cooking the company has come up with Maggie noodles or pastas. As they take less time and
efforts to make so it attracts large customer groups. The company has also gone into the range of
sauces and dips. Chocolate is the segment which the company is dominating over. For example
kitkat, milky bar etc. are the famous and recognized brand of the company. For the chocolates
company have large market share.

Price:
Company adopt the pricing strategy according to the market and the spending power of the
consumers. For example Maggie is the leader of the market so the price of Maggie is high then
the competition. The company is able to do this because of the quality of products they are
offering and also the customer loyalty that is why customers do not switch easily. The price of
the products also depends on the packaging and labelling of the goods. Nestle opt competitive
pricing for those products in which they are facing huge competition. If in any region the
purchasing power of the customer is low then the company adopt cost-efficient pricing strategy.
Place:
The product of nestle reaches to the customers through the agents, distributors and retailers. The
company have good sales network worldwide. Company regularly gives discounts and offers to
their distributors so that they remain happy. Company come with the strategy that if the
distributor purchase the weak product from the company like those products which are less in
demand then they will get discount of the products which are high in demand. Company faces
challenge in the chocolate segment where there is tough competition so company adopt such
promotional tactics to attract more customers towards the products.
Promotion:
Effective promotion methods are adopted by the company. They do the promotions about quality
of products they offer. There promotions are soo innovative which are enough to attract large
customer group. They are very active on social media and social media is used by many
consumers nowadays so company regular update their social media handles and the company
also solve the query of the customers through social media as doing promotion through this saves
time, efforts and money. Company should also focus on their website because the website of the
company can also generate good sales. So the website should have easy shopping and payments
options. Along with the modern technique like digital marketing company also consider
traditional methods for marketing like giving advertisement on TV, newspapers etc.
People:
People are the most important thing for the company. And efficient workforce can help the
company to reach towards its goals. Company make sure that they recruit the right staff and give
proper training to them so that they can contribute in the profit of the company. Their staff give

good customer service which builds loyal customer (Jia Wen and Jia Qi, 2020). Their staffs are
trained in such a manner that they attract the customers easily.
Recommendation:
The recommendation to the company is nestle should acquire companies so that this can be
helpful for the company in increasing the market share by reducing the competition. Company
should analyse the market trends carefully so that they can bring the products which can be high
in demand and can increase the revenue of the company. Also, focus on training their old
employees.
2. Stakeholder engagement and impact
Define stakeholders:
Organizational stakeholder can be a individual or a group which are having high amount
of interest in organizational activities because they are able to affect or are affected by the
organizational activities because of which they are having high interest in organizational
activities. This is important because through this analysis of stakeholders organizations can
develop effective grouping on stakeholders on the basis of their participation in organizational
activities (Galli and Vousvouras, 2020). Through this organizations like Nestle can develop
effective working strategies in such a way that it is able to achieve high level of work
productivity by which chances of facing resistance for new developed strategy can be minimized.
This is necessary because stakeholders are the able to affect the organizational working of Nestle
because of which if organization is not able to clarify the organizational vision then in that case it
may have to face stoning in its path to goal achievement. Therefore organizational stakeholders
have to be categorized on the basis of power and their amount of interest in organizational
activities. In which Nestle must manage closely the stakeholders which are having high interest
and high power of affect the working due to which it can increase the chances of goal
achievement by facing minimum resistance and similarly low efforts have to be made for
stakeholders which are having low power and low interest.
Internal and external stakeholders:
Organizational stakeholders can be grouped into two main categories on the basis of their
participation in organizational working because of which it can develop effective working
strategy by which chances of goal achievement can be increased. Stakeholders of organizations
like Nestle can be grouped in internal and external stakeholders, in which internal stakeholders

can be its employees, investors and many other which are having a direct engagement with the
organization (Dhanesh and Sriramesh, 2018). Whereas external stakeholders are the people
which may not be having a direct contact with the organization but are affected by the
organizational working, external stakeholders consists on customers, suppliers and many more.
Thus Nestle can group its stakeholders in different segments which may consist of customers,
governments, financial communities, etc. Through this action company can make sure that
stakeholders are arranged on the basis of their power and interest in organization's goal
achievement capabilities.
Source: MindTools, 2020
Thus Nestle has to make sure that effective categorization of stakeholders is done in such
a way that organizational efforts are concentrated on specific targetted stakeholders on the basis
of their participation in organizational working because of which Nestle can increasing their
loyalty with the company. By which it can achieve high output in minimum expenditures and
minimum input efforts because of which it can increase the chances of goal achievement and
also at the same time reduce the chances of brand switching (Yamoah, 2019). Thus by
concentrating organizational efforts on its valuable stakeholders Nestle can make sure that it is
able to reduce the chances of brand switching because of which the stakeholder engagement is
increased because of which company can implement chances. Such a way that it is able to
achieve its targets because of which it can make sure that it is able to provide new ans rare
products to the customers due to which Nestle can achieve an efficient competitive edge over
market competitions.
Communication with stakeholders and impact of stakeholders on marketing activities:
Illustration 2: Stakeholder analysis

Nestle is having a good communication with the stakeholders of the company so that
there is going to be effective working which is going to be present. There are a lot of actions
which are taking place in the market so that there is going to be collectively right measures and
decisions which can be made. Stakeholders have to be loyal and trust of them has to be present in
the company therefore Nestle is putting in their best so that they are able to make the right
planning for the company (Putri and Triyono, 2020). Customers have to be informed properly
about the changes which are coming in the company so that there is going to be effective
working which is going to be present. Society has changed a lot therefore the stakeholders of
Nestle are making sure that they are taking the right actions accordingly so that there is going to
be effective working. There has to be good relationship also which needs to be maintained by the
company so that there are going to be higher objectives which can be done. Barriers can rise if
there are going to be limitations in communication and that is not a good factor for the company
to have. For keeping the brand reputation and value of the company high in the market there has
to be effective working and operations which are going to be present in the business.
Impact of stakeholders on marketing activities-
Stakeholders are the individual and group which are having an authority of affecting
organizations working capabilities because of which company has to make sure that it develop
effective relation with the stakeholders. If company faces restrictions from its stakeholders then
in that case organization has to face limitations in its marketing strategies because of which it
may have to face limitations in customer's engagement sue to which negative impact on sales can
be seen. Stakeholders of organization can be any individual which is affecting organizational
activities even if like organizational employees, company's customers, raw material suppliers and
many others (Farache, Tetchner and Kollat, 2018). Due to which if internal stakeholders like
employees are not able to work according to the organizational requirements then in that case
company cannot provide new and rare products to the customers because of which it may have to
face limitation in sales because of which negative impact on economic growth can be observed.
With that it Nestle is not able to concentrate its efforts in developing effective relation with the
external stakeholders like suppliers then there are high chances that company has to face high
pricing from the suppliers side because of the limitations of alternative and due to which high
prices has to be paid by the organization.

CONCLUSION
Through this report it can be concluded that Nestle is the big company and constantly
trying to capture more and more market share. Discussion of the marketing mix of the company
along with mission statement of the company. Situation analysis is done through SWOT analysis
under which the strength, weakness, opportunities and threats of the company are evaluated. The
objectives of the company is formed and also given recommendations which company can
implement in their business. Segmentation, targeting and positioning of the company are done
and under the strategy porters five forces are analysed.

REFERENCES
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Dhanesh, G.S. and Sriramesh, K., 2018. Culture and crisis communication: Nestle India's Maggi
noodles case. Journal of International Management. 24(3). pp.204-214.
Esty, B. and Fisher, D., 2019. The a2 Milk Company. HBS Strategy Case, (719-424).
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into stakeholder reactions. In Corporate Responsibility and Digital Communities (pp.
145-163). Palgrave Macmillan, Cham.
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Jia Wen, C. and Jia Qi, C., 2020. ORGANIZATIONAL CONFLICT IN NESTLE.
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example of “Nestle” Corporation” (Doctoral dissertation, Тернопільський
національний технічний університет ім. Івана Пулюя).
Putri, A.P. and Triyono, A., 2020, August. Community, Dialog and Technology-Maximizing
Creating Shared Value (CSV) Nestle Indonesia. In 2nd Jogjakarta Communication
Conference (JCC 2020) (pp. 35-40). Atlantis Press.
Varma, G.R. and Ravi, J., 2017. Strategic Analysis on FMCG Goods: A Case Study on Nestle.
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Mainstreaming Marketing Strategy Era (Late 1950s-Late 2000s). International Review
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MARKETING PROCESS, 2016.[Online].Available through:
<https://dannybowl14.wordpress.com/outcomes-2/marketing-process/>
MindTools, Stakeholder Analysis, 2020 [Online], Online. Available through:
<https://www.mindtools.com/pages/article/newPPM_07.htm>
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