CHAPTER 1

Executive Summary

Nestl Bangladesh Limited is a leading

Food company with lots of global strategic
brands operating in Bangladesh. MAGGI
is one of the strategic brands of Nestl
Bangladesh Limited. Worldwide MAGGI
brand is used for Nestl's Soup, Noodles,
Seasonings, Recipe Mixes and Sauces.

In Bangladesh, MAGGI brand has two

product categories under this strategic
brand name: Noodles and Soups. As part

Image Proposed MAGGI Ketchup

of the brand extension and value creation

objective of the company, Nestl now is

Following this heritage and business

going to launch MAGGI Ketchup in

excellence in ketchup business, Nestl

Bangladeshi market. Ketchup and Sauce

Bangladesh is also interested to explore

business of Nestle under the brand name

the business in local market. Moreover, in

MAGGI is very much profitable and

Bangladesh, there's a huge market for

successful in other countries specially

Ketchup and sauces. A very good number

South Asian regions like in Nestle India

of players including some very strong

(10,000 tons per annum) and Nestle

local players are operating successfully in

Malaysia (12,000 Tons per annum). In

this market.

most of the countries, where MAGGI has

Now Nestle would like to launch in this

launched its ketchup range, it has become

segment and making a five years

the market leader in this category.

marketing

plan.

CHAPTER-2
SITUATIONAL ANALYSIS

2.1 MARKET SUMMARY

MAGGI finds 46 brands of Tomato ketchup are currently available in Bangladesh ketchup
market. Among the brands, 34% are selling Ketchup, are also selling the Chili variant along
with Tomato ketchup. The total volume of the sauce 68% volume comes from Tomato
Ketchup & the remaining 32% comes from chili. Brands with the highest penetration
nationally are the local brands Pran & Ahmed, mostly used for in home consumption by the
middle-income household Vs Best & Druk are used mostly for foodservice and by the higher
income household. Analysts predict that the ketchup market in Bangladesh have a great
potentiality to growing fast. It is assumed the next five years ketchup market in Bangladesh
will be increased more than 25% percent. So, there have a great potentiality to make a good
profit. For this great potentiality to margin profit, comprehensive competitive pressure has
been increased in the market. The estimated volume of the ketchup market is 1100 ton, with
25% growth expected within 5 years the total market size will be BDT 1.7 billion. To gain
market share in this environment, MAGGI Ketchup must carefully target specific market
segments.

MARKET DESCRIPTION:
Our product will hold the position in the market because we are providing high quality with
better tastier ketchup for the customers who are willing to money on the best. We posses good
information about the market and serves the best quality with reasonable pricing. Unlike the
mainstream products, we will not serve lower quality for maintaining lower cost.

Market Demographics: The profile for MAGGI Ketchup customers consist of the following
geographic, demographic, and behavior factors. Please note that MAGGI Ketchup has two
target segment customers, Families consumers and restaurants.

Families:
Geographic:

The immediate target is the city of Bangladesh.

Middle-income and upper-income household.

Demographics:

Singles and families.

Mostly females and children.

Have a household income of more than 10,000 tk per month.

Consuming per year at least 3 ketchup bottles.

Conscious consumer about their health.

Behavior Factors:

Paying a premium for higher quality, tastier ketchup.

Health consciousness

Restaurants (and their customers):

Geographic:

Fast food and restaurants in the cities of Bangladesh.

Demographics:

Male and female.

Single and families.

Tend to patronize higher-quality restaurants.

Behavior factors:

Health consciousness

High-quality meal.

Market Needs: MAGGI Ketchup provides individuals, families and restaurants with
high-quality tomato and chili ketchup. MAGGI Ketchup seeks to fulfill the following benefits
that are important to their customers.

High quality: MAGGI Ketchup offers a wide selection of health conscious

choices, and utilizes high quality ingredients.

Competitive pricing. Our products will be priced competitive to the market.

Market Trends:
The market for ketchup has exploded within the last five years. Explanations for this
trend are:

Market supply: The increase of supply has reinforced the demand. Within the
last few years many firms that were producing different types of food items have
moved to production of ketchup because of the increased margins and market
demand.

Health consciousness: Now-a-days people have become more health conscious

and MAGGI Ketchup contains nutritious ingredients with tastier flavor.

Food quality. The preference for high-quality ingredients is increasing as

customers are learning to appreciate the qualitative differences.

Market Growth:
Now the total size of the ketchup market is more than BDT 1.2 billion. Analysts
forecast that the market size will be growing faster. Now people are appreciating the
more taste of nutritious food. MAGGI Ketchup contains nutritious ingredient makes
food more tasty and delicious. So, customer growth has risen. This customer growth
rate can be forecasted to gain better market share.

2.2 SWOT ANALYSIS:

MAGGI Ketchup has several powerful strengths on which to build, but our major weakness
is higher pricing than local product and unimpressive packaging. The major opportunity is
growing demand for foodservices area as well as household user of ketchup that benefits us
to expand our market. We also face the threat of ever-high competition and downward
pressure on pricing. The following SWOT analysis captures the key strengths and weaknesses
within the company and describes the opportunity and threats of outside the company by
MAGGI Ketchup. Table2.1 summarizes the main strengths, weakness, opportunities and
threats facing MAGGI Ketchup.

Strengths:

MAGGI Ketchup can build on three strengths:

Brand Image: In Bangladesh, two brand products of MAGGI: - MAGGI Soup and
MAGGI Noodles have gained highest market share in the competitive market as well
as succeed to make a good brand image. This brand image helps to make an assurance
better quality and taste of MAGGI Ketchup to the potential customers.
Attractive trade promotion: Our product offers competitive trade promotion to the
retailers, which ultimately helps to increase secondary sales.
Quality and Taste: Our product maintains good quality and makes it delicious which
ultimately helps to gain more ketchup consumer.

Weakness:
By waiting to enter the market until the initial shakeout and consolidation of competitors
has occurred, MAGGI Ketchup has learned from the successes and mistakes of others.
Nonetheless, we have two main weaknesses:

Unimpressive packaging: Our packaging is not so impressive when compare to

imported brands packaging.
Price: Price is comparatively high to local brands.
Table2.1 MAGGI Ketchups Strength, Weakness, Opportunity and Threats.
Strengths
Weakness:

Higher Brand image

Attractive trade promotion
Quality and Taste

Opportunity

Developing foodservice industry

Improvement of product and

packaging quality.
Decreased operations cost

Unimpressive packaging
Higher pricing than local brands

Threats

Increased competition
Modest economy
Downward pressure on pricing

Opportunity:

MAGGI Ketchup can take advantages of three major market opportunities:

Developing foodservice industry: People are appreciating the more taste of food.
MAGGI Ketchup is not only delicious itself but also increases the taste of other food
when MAGGI ketchup is mixed with it. Habit of taking fast-food has been risen when
restaurants serves MAGGI Ketchup with other foods.
Improvement of product & packaging quality: With continuous improvement
process, we improve the ability to improve product & packaging quality.
Decreased operations cost: Follow a disciplined continuous improvement process
that facilitates their ability to promote growth while reducing their delivered product
cost and eliminating non-value added activities.
Threats:

We face three treat at the introducing of the MAGGI Ketchup:

Increased competition: More companies (local and foreign brands) are currently
available in the market. To gain the reasonable market share, we have to maintain our
quality all the best.
Modest economy: A slump in the economy-reducing customer's disposable income
spent on eating out.
Downward pressure on pricing: Increased competition and market share strategies
are pushing the product price down.

2.3 COMPETITION
Increased entry of established sauce, ketchup and pickle food industry has pressured industry
participants to continually add features and cut price. Key competitors include:

Table. 2.2Selected Competitive companys targeted consumer and price

Brand
Pran

Pack Size Price

340
40

Mkt. Share Targeted Consumer

20.0%
Middle and upper- income household& also

Best

340

19.3%

restaurants
Middle and upper income households &

13.4%
11.6%
7.0%
4.7%
3.5%
2.6%
17.9%

foodservice area
Middle-income household
Upper income households& foodservice area
Households & Restaurants
Middle-income household
Middle and upper- income household
Upper income households& foodservice area
Household & foodservice area

Ahmed
Druk
Roza
Meridian
BD
Heinz
Others

340
400
300
285
340
300
Avg. 320

49
40
63
45
46
50
49
Avg.45

100.00%

Pran: The ketchup market is dominated by Pran with its 20% market share with 340
gram packed size which is sold in taka 40. Pran is the best selling sauce in household.
Middle and upper-income households prefer pran for home consumption. In terms of

availability, Pran is available in most of the store. High numeric distribution of Pran can
be seen nationally. It has 250 distributors in all over Bangladesh. Pran is giving highest
trade promotion to the retailers. It offers credit for the retailers for highest selling in the
market.

Best: Best is also the most popular brand in the middle & upper income households. It
holds 19.3% market share with 340 gram packed size which is sold in taka 50. Best is the
best selling sauce in foodservice area. In Fast food shop 4gm best sauce is very much
popular. It is giving competitive trade promotion to the retailers.

Ahmed: The local brand Ahmed gains 13.4% market share with its 340 gram packed size
which is sold in taka 40. The middle-income household mostly uses for it in home
consumption.

Druk: Druk is the most popular brand upper income households. It acquires the best
selling sauce in foodservice area. Most of the renowned restaurants use druk for food
serve. Druk has 11.6 % market share with its 400gram packed size which is sold in taka
63.

Roza: Roza possess 7 % market share. It is also consumed for household consumption as
well as restaurants. The chili flavor is mostly used in the restaurant.

Meridian: Meridian is used mostly for in home consumption by the middle-income

households. It gains 5% of the total market share. It gives incentive trade promotion for
retailers. It offers 1 Sauce free for 1 dozen of sauce purchase for retailers.
BD: BD is the newly entry sauce industry in the ketchup market. Within a short time, it
gains 3.5% market share for TV communication with high frequency.

Heinz: Foreign brands Heinz acquire 2.6% share with its 300 gram packed size which is
sold in taka 49. Restaurants and upper-income households are the main customer of
Heinz.

Others: Roma, Kohinoor, Kimball, Del Monte, Seema, Suree and others have the rest
market. Most of them are used in the restaurants. Most of the restaurants use Chili sauce
for cooking and other purposes.

Despite this strong competition, MAGGI Ketchup can carve out a definite image and gain
recognition among the targeted segments. Figure-2.1 shows competitive companys markets
share holding:

KEYS TO SUCCESS:
The keys to success are producing ketchup that meets market demand. In addition, our
ketchup must ensure total customer satisfaction. If these keys to success are achieved, it will
become a profitable company. The following are the areas where the company is pioneer:

Uncompromising commitment to the quality of the product.

Continuously revitalize the products.

Communicate the differentiation and quality of our offering through personal

interaction and media.

CRITICAL ISSUES:

MAGGI Ketchup is still in the speculative stage. Its critical issues emerge from the SWOT
analysis and review of the market:

National economic conditions, which are not favorable to the people.

Constantly monitor customer satisfaction, ensuring that the growth strategy will never
compromise satisfaction level.

2.4 PRODUCT OFFERING:

MAGGI Ketchup is going to launch two popular variants in the market. MAGGI has created
MAGGI tomato ketchup and MAGGI chili ketchup that are differentiated and superior to
competitors. Customers can taste the quality and freshness of the product in every bite. The
following are characteristics of the product:
1. Best quality
2. More durability
3. Posses no harmful chemical ingredient
MAGGI, one of the strategic brands of Nestl, is dedicated to providing the best foods to
people throughout their day, throughout their lives. With our unique experience of
anticipating consumers needs and creating solutions, MAGGI contributes to consumers
well-being and enhances consumers quality of life.
2.5 DISTRIBUTION REVIEW:
Our strategy assumes that we need to go into specialty channels to address our target
customer's needs. We position our products as the highest quality, highest incentive offering
for our own distribution channel. Our distribution channel is:

rManufactur
e

Distribut
or

Retailer

Final
consumer

CHAPTER-3
MARKETING STRATEGY

3.0 MARKETING STRATEGY:

Our marketing strategy is based on a positioning of product differentiation. On the consumer
side, we have targeted the middle to upper class households who need ketchup for family and
their children to add extra taste to their eating. Most of the middle class consumers want the
price of the ketchup be 40 to 45 tk. i.e. they want lower- priced product with high durability
and preservation ability. Most of this segment can be demographically described by age (3045).
Besides, we have set a goal to serve some restaurants on the business side. This target market
ranges from the small to three or 5 star hotels who want to serve their customers ketchup with
a different but wonderful taste and want more preservation within a reasonable price.
Each of the four marketing mix strategies conveys our differentiation to the target marker
segments identified above.
3.1 OBJECTIVES:
We have set some successive and achievable financial and marketing objectives to be
successful in the marker.
Financial Objectives:

We want to gain a no loss-no gain condition over the next 3 years.

We want to produce total revenue of BDT 4750000 in 1st year and BDT 6,650,000 in
the next year.

Within 5 years, we want to produce an amount of profit 3.2 million based on per unit
price of BDT 38(wholesale price)

Marketing Objectives:
Achieve a first-year unit sales volume of 125,000 units, which represents a projected marker
share of around 4% in the product line.

Increase second-year share to 5.50%.

Arrange of distribution through the leading retailers and distributors in the country
market within next 6 years

3.2 Target Market:

MAGGI Ketchup market consists of middle and upper-income household as well as
foodservice sector for example; restaurant.

Target Market Forecast:

Potential Customers Growth
Families
Restaurants
Total

2012

2013

2013

2014

2015

25%

25000

31250

39062

48828

61035

15%

1500

1725

1983

2281

2625

24.5%

26500

32975

41045

51109

63660

3.3 POSITIONING:

Positioning is the act of designing the companys offering and image to occupy a distinctive
place in the mind of the target market. Actually our strategy is to grab an unoccupied
position. Our market positioning strategy is given below in a table:

Company&

Target

Benefits

Product
Consumers
Nestl(Maggi) Quality conscious More
(Ketchup)

Price

Value

At an

Proposition
Tastier, spicy

consumers of

preservation

affordable price ketchup from the

ketchup

ability and tasty for the middle

class and upper

pure ingredients at
a moderate price.

class families.

3.4 Marketing Mix Strategy

PRODUCT STRATEGY:
Our Maggi ketchup, including all the features described in the earlier Product Review, will be
sold with a more preservation ability warranty than the other products in the market. In the
following year, we will try to increase more taste and ingredients and launch ketchup which
the lower-middle class consumers will also be able to buy. Building the Maggi Brand is an
integral part of our product strategy. The brand and logo will be displayed on the product and
its packaging and reinforced by its prominence in the introductory marketing campaign.

PRICING STRATEGY:
Maggi ketchup will be introduced at 38 taka wholesale and 45 taka estimated retail price per
unit if we want to have some profitability. We expect to lower the price of this first product
when we expand the product line by launching the next ketchup. These prices reflect a
strategy of attracting desirable channel partners and taking marker share from our major
competitor Pran.

DISTRIBUTION STRATEGY:
Our channel strategy is to use selective distribution to have our product sold through wellknown stores and shopping malls. During the first year, we will add channel partners until we
have coverage in the country market and the product is included in the major ketchup
catalogs and Websites. In support of our channel partners, Maggi will provide detailed
specification handouts, full-color photos and displays featuring the product. We will also
arrange special trade terms for retailers who place volume orders.

MARKETING COMMUNICATION STRATEGY:

By integrating all messages in all media, we will reinforce the brand name and the main
points of product differentiation. We will introduce advertising on a pulsing basis to maintain
brand awareness and communicate various differentiation messages. Advertising agency will
also coordinate public relations efforts to build the Maggi brand and support the
differentiation message. To attract marker attention and encourage purchasing, we will offer
some products of Maggi such as Maggi noodles free. To attract, retain and motivate channel
partners for a push strategy, we will use trade sales promotion and personal selling to channel
partners. Until the Maggi brand has been established, our communications will encourage
purchases through channel partners rather than from our Website.

3.5 MARKETING RESEARCH:

Using research, we can identify the specific features and benefits that our target market
segments value. Feedback from market tests, surveys and focus groups will help us to
develop our ketchup. We are also measuring and analyzing customers attitudes toward
competing brands and products by surveying in the households and restaurants. Brand
awareness research will help us to determine the effectiveness and efficiency of our messages
and media. As we want to establish our own image, we will initiate questionnaire to be
acquainted with the consumers need and wants. Finally, we will use Customer satisfaction
studies to gauge marker reaction.

CHAPTER-4
FINANCIAL ASPECTS

4.0 FINANCIAL ASPECT:

This section will offer a financial overview of MAGGI Ketchup as it relates to the marketing
activities. MAGGI Ketchup will address break-even analysis, sales forecasts, expenses
forecasts and indicate how this activities link to the marketing strategy:
4.1 BREAK-EVEN ANALYSIS:
The break-even analyses indicate that BDT 4,000,000 will be required in sales revenue to
reach the break-even point. Our market research forecasts that within 3 years we will reach
the break-even point.

4.75

6.65

7.6

8.5

Table. 4.1 Break-even Analysis

Break-even Analysis:
Break-even Units

500,000

Break-even Revenue

4,000,000

Assumptions:

10.5

Per-Unit Revenue

38.00

Per-Unit Variable Cost

30.00

Fixed Cost

4,000,000

4.2 SALES FORECAST:

We feel that the sales forecasts group customers into two categories: families and restaurants.
So, both types of customers will lead us to differently forecast of our sales volume:
Table.4.2 Yearly Sales Forecast

4.3

Sales Forecast
Sales
2012
BDT
Families
3325000
BDT
Restaurants
1425000
BDT
Total Sales
4750000
Cost of
2012

2013
BDT

2014
BDT

2015
BDT

2016
BDT

4655000
BDT

5320000
BDT

5985000
BDT

7315000
BDT

1995000
BDT

2280000
BDT

2565000
BDT

3135000
BDT

6650000
2013

7600000
2014

8550000
2015

10450000
2016

BDT

BDT

BDT

BDT

BDT

1837500
BDT

2572500
BDT

2940000
BDT

3307500
BDT

4042500
BDT

787500
BDT

1102500
BDT

1260000
BDT

1417500
BDT

1732500
BDT

3675000

4200000

4725000

5775000

Sales
Families
Restaurants
Total Sales

2625000
EXPENSE FORECAST:

Our expenses occur as the result of both historically successful marketing endeavors and
projected marketing programs designed to take advantage of expanding markets and
improved product lines. Similarly, the development of publishing department will incur
higher start-up expenses than maintenance costs after the initial publication. We have chosen
these two new marketing programs as areas where expenses can initially build up because
research indicates that they will cause our market share to increase exponentially over time.

Table.4.3 Yearly Expense Budget

Marketing Expense Budget

2012
BDT
Personal selling
100000
BDT
Advertising
600000
BDT
Sales promotion
300000
Total Marketing
BDT
Expenses
Percent of Sales

1000000
26.67%

2013
BDT

2014
BDT

2015
BDT

2016
BDT

144500
BDT

165000
BDT

185000
BDT

227500
BDT

867000
BDT

990000
BDT

1110000
BDT

1365000
BDT

433500
BDT

495000
BDT

555000
BDT

682500
BDT

1445000
27.50%

1650000
27.5%

1850000
27.4%

2275000
27.6%

CHAPTER-5
CONTROLS

5.1 CONTROLS
The purpose of our marketing plan is to serve as a guide for the organization. This marketing
plan includes a detailed budget schedule and managerial assignment for every action
program. For control purpose, the plan also allows for month-by-month comparison of actual
versus projected sales and expense. If there is any mishap in the quality or in the price fixing,
the company will control this for its own sake. A contingency plan, attached, has been
developed for implementation in case of severe downward pricing pressure. The following
areas will be monitored to gauge performance:
Revenue: Monthly and annual
Expense: Monthly and annual
Customer satisfaction: Monthly

5.2 IMPLEMENTATION MILESTONES:

The following milestones identify the key marketing programs. It is important to accomplish
each one on time, and on budget. Nestle will carry out its marketing strategy and achieve its

objectives through a variety of scheduled programs. We will follow a five years planning to
achieve our profit margin. We will now analyze the year wise action programs as follows:

2012: We have a plan to initiate a -----tk sales promotion to educate dealers and
generate considerable awareness for the product launch in 2009. As part of this push trade
strategy, Nestle will perform personal sales promotion. A volume of ----units will be used for
this purpose. Then advertising programs through the various mass Medias
print, internet etc

radio, television,

will be performed to acknowledge people about the product.

2013: In the very beginning of this year, the personal sales promotion will be
withdrawn. We have a target to gain at least the sales revenue of ----tk in this year projected.
By this revenue, we can cover partially the losses of the previous year. To reach the breakeven point next year we have to build the platform. We expect that people are fully aware of
our product now.

2014: This year is very much important for running our business. This year when we
have to reach our break-even point as we expect. We will complete our sales of 500000 units
to achieve no loss-no profit situation. Here we will earn ---------tk of sales revenue, while the
sales promotion will be accelerated with respect to the market demand.

2015: The past three years were to build up the platform for the sales of our product.
In this year we will emphasize on the quality control of our product. To maintain the other
marketing action we may have less emphasize on this task. We will try to maintain the price
same as before. The revenue function may get a downward sloping for the quality control at
the same price. So we have to increase the sales volume at a slight amount. From the very
beginning of the year we have to notice that we are getting nearer to the profitability targeted.
2016: Gaining satisfying profitability is the main target of this year. Further features
should be added to our product. Frequent analysis of the quality of the product will be carried
out for the quality control. Analyzing customer satisfaction is also a vital activity for running
the business.

. 5.3 MARKETING ORGANIZATION:

The chief marketing officer of Maggi, Nestl Bangladesh Limited is responsible for overall
marketing strategy, direction and implementing it. We have hired the countrys most familiar
marketing channels to handle national sales campaigns, trade and consumer sales promotions
and public relations officer. The following figure shows the structure of the seven person
marketing organization.

CHAPTER-6
CONCLUSION

Every business has some risks and difficulties. Similarly, our product may face some risks
and difficulties. Pran possesses the major parts of the market. As a new product, we may have
to suffer if we cannot persuade the consumers. It is risky in the first year to make every
consumer believed that ours is the best tasty and quality product. From the business view
point, the restaurants may not be eager to use new product as they trust the common ones.
Other potential competitors may produce products with the same features. If the competitors
decrease their price, initially we will not be able to decrease our price as we are just
launching our product. For inflation and decreasing living standard, people may not be
willing to buy this product and this may create the run on of our business. Maggi ketchup will
use direct selling as the marketing arm to sell its products. We will have the school
representatives. They will make their initial presentation to a school principal. We will do it
to make the present guardians familiar of our product and its taste and quality.

APPENDIX
Bibliography

1. Kotler Philip, Marketing Management, 11th edition, Prentice Hall, 2003

2. Kotler Philip & Armstrong Gary, Principles of Marketing, 11th edition, Prentice Hall,
2006
3. http://www. Nestle .com
4. http://www.nutrition.nestle.com

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