Marketing Plan: Nestle Milo's Australian Market Strategy

This report presents a comprehensive marketing plan for Nestle Milo in the Australian market. It begins with an introduction outlining the challenges Milo faces, including market competitiveness and customer perception issues. A situational analysis is conducted, encompassing PESTLE and SWOT analyses to evaluate the external and internal environments. The report identifies the target market as children aged 5-10 and their parents, analyzing their consumer behavior. A detailed marketing strategy is proposed, including product, promotion, pricing, and place considerations. Implementation and evaluation strategies are also outlined to measure the plan's effectiveness. The report aims to rejuvenate Milo's market capitalisation by addressing its weaknesses and capitalizing on opportunities, such as population growth and consumer demand for healthy products. The plan emphasizes the importance of adapting to market dynamics and addressing consumer concerns to ensure long-term success.

Running Head: MARKETING PLAN
MARKETING PLAN
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Table of Contents
Part A...............................................................................................................................................3
Part B...............................................................................................................................................5
Introduction......................................................................................................................................5
Background......................................................................................................................................5
Situational Analysis.........................................................................................................................6
Pestle analysis..............................................................................................................................6
Political....................................................................................................................................6
Economic.................................................................................................................................6
Social.......................................................................................................................................7
Technological..........................................................................................................................7
Legal........................................................................................................................................7
Environmental..........................................................................................................................8
Swot analysis...............................................................................................................................8
Objectives........................................................................................................................................9
Target market...................................................................................................................................9
Consumer behaviour in target market............................................................................................10
Marketing strategy.........................................................................................................................11
Product...................................................................................................................................11
Promotion..............................................................................................................................11

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Price.......................................................................................................................................11
Place.......................................................................................................................................12
Implementation..............................................................................................................................12
Evaluation......................................................................................................................................12
Conclusion.....................................................................................................................................13
Reference.......................................................................................................................................14

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Part A
Nestle Milo is one of the leading chocolate malt beverage brand in the world with its
target customers as the kids. As per the organisational website, the Milo products are of high
nutritional value with the purpose of developing health of the kids. However, in Australia the
company is facing severe problem due to market competitiveness and the quality issue is also
triggering the volatility of the customers. As a result of that the purpose of this assignment is to
prepare a solid marketing plan that will able to rejuvenate the market capitalisation of Milo,
Nestle.
From the external environment analysis, it can be argued that there are some pros and
cons that Milo can face in course of doing business in Australia. Form the political and economic
perspective, Australian market is steadily growing with lot of exposure for the development of
the business firms. Coupled with the social diversities and cultural underpinnings, the Australian
food and beverages market is highly lucrative for the business organisations to grow robustly
because of huge number of potential customers. In addition to this, the behaviour of the
customers are also identified as an important aspect for the organisations like Nestle to set up
business profoundly. However, there are certain factors that the corporate firms have to consider
in terms of the use of advanced technology and environmental considerations. As far as the
introduction of technology in business organisations is concerned, it can be argued that Nestle
always puts focus on high use of technology in production and manufacturing. This will provide
a strategic advantage for nestle Milo to expand its market extensively. On the other hand,
environmental considerations are also pertinent for Milo to consolidate the business. There are

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some legal framework related to the sustainability issues. Therefore, Nestle Milo also follows
some measures to abide the environmental and sustainability regulations in Australia.
The internal environment is evaluated by the SWOT analysis and connotes some
strengths and weaknesses that Nestle Milo is faced in its business. The strengths are associated
with the brand value of the organisation and partnership with big companies like Coca Cola. In
this regard, the global image and enormous market capitalisation provide strategic advantage to
Nestle Milo. On the other hand, the weaknesses can be identified as the limited retail and
distribution that the organisation follows. Moreover, fluctuation in the customer behaviour is also
created huge impact on the organisation. In fact, there are lack of innovation and alternatives that
the organisation produces which restrict the market expansion of Nestle Milo. Despite of the
weaknesses, there are enough opportunity for Milo to reconstruct its market robustly with the
help of population booming in Australia and the government endorsement to consume healthy
products. Besides this, high purchasing power capacity in the Australian market with an
increasing demand of the Milo products creates further opportunity for the Nestle Milo to
capitalise the market effectively. Nonetheless, the threats in business like high competitiveness,
high power of the distributors and quality of products are of great concern for Nestle.
Based on this analysis, the target customer of Nestle will be the kids at the age of 5-10
and their parents also. The objective of the company is to increase the sales growth of Milo in
Australia extensively and increase the profit percentage in Milo products up to 10% within the
next 2 years. Therefore, a marketing strategy is going to be implemented using both the
traditional and advanced marketing tools like digital media. In pricing strategy Milo intends to
set a moderate price of the products so that it will maximise the potential customers. Moreover, a
campaign is also conducted to engage the community in the marketing process.

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Part B
Introduction
Milo is one of the leading chocolate malt beverage of Nestle that can be prepared with
hot or cold milk and water. The product is highly popular across the world especially in Africa,
Asia and Oceania. The taste of the brand creates huge marketing opportunity for Nestle that
focuses on the Kids’ development specifically. This energy beverage is strongly associated with
the sports and good health. Nevertheless, currently the Milo products are facing serious criticism
in Australia as the nutritionists and health experts alleged that Nestle tricked the customers with
false brand description that Milo is healthy. It costs a huge deterioration on the image of Milo
and requires a strong marketing plan that can revive the market of Milo effectively.
In this regard, this marketing plan is set to develop the brand image of Milo by carrying
out a number of analytical tools. For instance, use of pestle and swot for the situational analysis
and 4Ps marketing mix strategy are pertinent in this discussion. Moreover, the report also intends
to develop an implementation and evaluation process of the proposed strategy in order to analyse
the efficacy of the marketing plan.
Background
Nestle is considered to be the largest food company around the world in terms of both
measuring the by revenues and other metrics. The company mainly offers products in terms of
baby foods, medical foods, bottled water, coffee and tea and dairy products as well. In the
financial year of 2018, the company generated a revenue worth of $91.439 billion. Milo is one of
the main products that the company is manufacturing through a long time. In Australia, the

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product was launched in early 1930s as a kid product with specific nutritional values like vitamin
A, B and C. As per the company website this product can also be used as an energy and sports
drink.
Situational Analysis
Pestle analysis
Political
The government stability in the Australian market is highly effective for Nestle to do
business in the market. As per the report of TheGlobalEconomy.com (2019) it can be stated that
the political stability index of Australia is 1.01 in average. It creates effective business
development for Nestle. However, the government effectiveness in Australia is decreasing since
2013. Nonetheless, the current government effectiveness index connotes a value of 1.72 points
which is effective to set business extensively. Currently, the country witnesses a great deal of
increase in the quality of regulation with 1.93 points.
Economic
In the economic aspect, Australia is on the apex of its economic growth with an average
of 3.46% in a year. The World Bank statistics confirmed that in the third quarter of the fiscal
year of 2018 the country witnessed a highest growth in GDP with AU$499.35 billion. Therefore,
Nestle can get a promising advantage in Australian market. In association to this, the Consumer
Price Index in Australia is also elevating in a stable manner with 114.1 points in the third quarter
of 2018.

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Social
The United Nations population report stated that in Australia population boom is one of
the major characteristics and the government endorsement towards healthy well-being is a
significant measure in this regard. During 2017, the population growth had been increased at a
rate of 24.6 points. It means the growth in population will also increase the target market for the
business organisation.
Technological
According to Lundqvist (2014) the impact of globalisation is highly affected the business
orientation of the companies and changes in the business activities with advanced technology is a
crucial part for the corporate firms to enhance sustainability in Australian market. In respect to
this, the innovation index in Australia is 52 points in 2018 that helps the market to carry out the
practice of innovation robustly. As a matter of fact, the high tech export in the Australian market
is also high with a value of 1.31.
Legal
The Fair Work Act was enacted in 2009 with the purpose to render a clear and
transparent relationship between the employees and employers. Moreover, for standardisation of
products Australian legislation also encompasses a detailed rules under the Australian Consumer
law (ACL). It is mandatory for the business companies to follow the quality and standards and
usher a better business orientation.

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Environmental
The government provides a detailed regulatory framework for the business firms in order
to follow the Environment Protection and Biodiversity Act of 1999. It is also associated with the
energy consumptions by the companies and ensure preservation of the resources.
Swot analysis
Strengths Opportunities
 Milo is a diversified product encompassing
Milo sports, Milo cereals and Milo snack
bars.
 The variety of brand helps Nestle to build up
a strong weather economics based on the
segmentation of market.
 Business partnership with leading brands like
Coca-Cola and General Mills helps the
organisation effectively.
 Most trusted brand in the world.
 Strong Research and development facility.
 Huge market share in Australia.
 Australian retail market is highly developed
where alternate retail giants are available.
 Increase in the purchasing power capacity of
Australian population.
 High demand for Milo products among the
Australian kids.
 Population booming is going to create large
market opportunities for Nestle.
 The government endorsement to healthy and
nutritious consumptions provide strategic
advantage for Nestle in Australia.
Weaknesses Threats
 The current business of Nestle is facing
severe threat due to change in customer
behaviour.
 Alternative retailing option is limited for
 High competitiveness in Australian market as
there are energy drink manufacturing giants
like Mountain Dew, Red Bull and Coca Cola.
 High power of influence of the distributors

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Nestle.
 Lack of innovative products.
 High costs in product launching but less
fashionable products.
like Coles and Woolworths.
 High government interference and trade
union practice.
 Degrading quality of Milo products.
Objectives
In this regard, Nestle is trying to plan a set of objectives with the help of SMART tool.
Specific Increase the sales growth of Milo products.
Measureable Increase the sales growth up to 10%
Attainable Already the Milo products encapsulate the market with 25% of the entire
business. Therefore, it will be attainable to increase it 10% more.
Realistic The increase can be achievable because Nestle has a strong consumer base with a
range of diverse products.
Timeline The sales growth will be achieved by 2 years.
Target market
The target market of Milo is based on geographic, demographic, psychographic and
behavioural area. For the geographic segmentation, Nestle puts focus on the hot and cold
weather in Australia. As the country is arid and warmer than other neighbouring countries
therefore, using the Milo product by hot and cold water can be done.

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On the other hand, the demographic segmentation guides Milo to target the customers on
the basis of their ages. Kids with the age of 5 to 10 are the primary customers of Milo products in
Australia. The reason behind choosing this age of customers is that the product specifications
strongly fit kids and the organisation creates an image of Milo products for the growth of the
kids effectively.
The psychographic segmentation is associated with the lifestyle of the customers. In this
context, kids with a middle class life style are the best target customers for Nestle. As a matter of
fact, the organisation manufactures the Milo products in reference to the general young
population.
As far as the behavioural segmentation is concerned, it can be stated that children and
their parents who are highly concerned about the growth and physical development of their kids
are the target customers for Milo products.
Consumer behaviour in target market
The consumer behaviour of the target market is divided into two part. The first part deals
with the behaviour of the kids. High involvement of the kids as the major target customers is a
strategic measure on which the organisation puts enormous focus. Therefore, Nestle carefully
manufactured the product on the basis of the likings of the children. Moreover, another
significant factor can be identified in terms of the behaviour of the parents. The in-depth analysis
of Nepper and Chai (2016) advocated that the health related concerns of the parents regarding
the health drinks is also considered to be an important aspect for the organisations to deal with.
Therefore, Nestle also puts a great deal of emphasis on the parents’ concerns and try to convince
them with the nutritious factors that are used in the Milo products.

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Marketing strategy
Product
Developing the new Milo product in reference to the target customers is considered to be
an important aspect for Nestle. In this regard, the company intends to set a wide range of
products that can attract people of different ages. Moreover, energy drinks of Milo and Milo
cereals are important to meet the demand of the customers.
Promotion
It is also the objective of the organisation to increase the market share of Milo with a
sales growth of 10% within next two years. Therefore, a rigorous marketing plan has to be
implemented. The traditional market strategies will focus on the local newspapers, television and
billboards. Along with this, digital marketing is also followed in terms of the advertising on
social media like Twitter, Facebook and Instagram. Furthermore, different website pages are also
used in order to maximise the customers as far as possible.
Price
The price of the Milo products follows a moderate price range due to huge focus on
different customer segmentation. Therefore, 1 kg. Milo will cost AU$11 whereas the price of the
cereals is a bit high with AU$ 16 for 1 kg. The purpose of such price segments is the reason of
maximising the target customers within a year so that it will provide a strategic advantage for the
organisation in near future business orientation.