4

CHAPTER
OBJECTIVE OF THESTUDY

5
My main objective of the project is to study the marketing mix of Nestle India
Ltd.Other Objectives of the study are:

To understand
Nestlé‘s
share in Indian food market.

To find out that what all strategies a company makes and follows for their
products.

To understand the Indian food market.

The major steps taken by the company to enhance the sales.

To analyze the strength of Nestle in the Baby food segment

RESEARCHMETHODOLOGY

Secondary research can be described as the most widely used method for data
collection. Thisprocess involves accessing information that is already gathered
from either the originator or adistributor of primary research. Secondary
research includes collecting information from third-party sources such as
company websites, sales and accounting records, magazine articles
andmarketing research reports. It also includes any previously gathered
information used by themarketer from any internal or external source.

Achieving accuracy in any research requires in depth study regarding the

subject. As the primeobjective of the project is to compare Cadbury with the
existing competitors in the market andthe impact of Nestle on Cadbury, the
research methodology adopted is basically based onsecondary data. Sources of
secondary data used to obtain information on Cadbury and itscompetitor
history, current issues, policies, procedures etc, wherever
required.1)Internet2)Magazines3)Newspapers
SECONDARY DATANESTLE SUCCESS STORY

From the famous Nestlé's chocolate that gratifies the sweet tooth of millions, to
Stouffer's frozenfamily dinners served up by harried soccer moms, to Fancy
Feast cat food for pampered felinesfrom coast to coast, Nestlé USA's basket of
products caters to a wide range of consumer needs.For many years, the
operations of this US$6.6 billion subsidiaryof Swiss food giant Nestlé SA
reflected the diversity andindividuality of its hundreds of brands. Created in
1991 to unifydisparate divisions, Nestlé USA's business units
neverthelessremained largely autonomous, and that arrangement workedwell for
a number of years. But, as competition heated up
—
with massive industry consolidation and retailers' private labelproducts eroding
customer loyalty and squeezing margins
—
Nestlé USA needed to wring out efficiencies to slash costs andboost bottom-
line performance.In response, the company crafted a vision it called One Nestlé
—
a vision that would introduce common processes, standards,and systems across
the enterprise, resulting in unprecedentedeconomies of scale and cost
savings.To make that vision a reality, Nestlé USA selected SAP software to
automate and integrate alloperations, from procurement through production,
distribution, and customer care. At the sametime, Nestlé USA was well aware
that this was not simply a software implementation that wouldautomate existing
processes, but rather an undertaking that would mean fundamental changes
inhow it approached and ran its business.
From vision to reality
To that end, Nestlé USA first reworked, standardized, and integrated its
operations, and thenimplemented the technology to support its new and
improved way of doing business. And all of this was done while making certain
that employees had the appropriate training for their new jobs.This was no easy
task to be accomplished overnight, that's for sure."Nestlé USA did it right. A
huge SAP implementation like this is so not about the software,"says Jack
Ringquist, a Deloitte Consulting partner helping to drive Nestlé USA's
transformationefforts. "Anyone who simply lays the technology on top of
existing business processes isdoomed. This is the time to unite far-flung parts of
the business into a cohesive, smart, andefficient whole
—
and that's done by fundamentally reworking how the company operates.
 22
Nestlé's Corporate Business Principles
The Nestlé Corporate Business Principles are at the basis of our company‘s
culture, which has
developed over the span of 140 years.
Since Henri Nestlé first developed his successful infant cereal ―Farine Lactée‖,
we have built our
business on the conviction that to have long-term success for our shareholders,
we not only haveto comply with all applicable legal requirements and ensure
that all our activities are sustainable,but additionally we have to create
significant value for society.At Nestlé we call this Creating Shared Value.

The new version of our Corporate Business Principles, updated in June 2010,
will be handed
over to each of our 280‘000 employees by the end of 2010 and accompanied by
basic learning
and training tools.As of 2011, a modular training programme will be rolled out
on the various components of theCorporate Business Principles. The depth and
focus of the trainings will be established inaccordance with the materiality for
the different functions within the company. For example, thetraining on the
human rights components will focus on managers and employees in countries
of higher human rights risks as a priority, with the aim to having completed the
first training cycleby the end of the year.Our Corporate Business Principles will
continue to evolve and adapt to a changing world, ourbasic foundation is
unchanged from the time of the origins of our Company, and reflects thebasic
ideas of fairness, honesty, and a general concern for people.Nestlé is committed
to the following Business Principles in all countries, taking into accountlocal
legislation, cultural and religious practices:

1. Nutrition, Health and Wellness

23
Our core aim is to enhance the quality of
consumer‘s
lives every day, everywhere by offeringtastier and healthier food and beverage
choices and encouraging a healthy lifestyle. We expressthis via our corporate
proposition 'Good Food, Good Life'.
2. Quality Assurance and product safety
Everywhere in the world, the Nestlé name represents a promise to the consumer
that the productis safe and of high standard.

3. Consumer Communication
We are committed to responsible, reliable consumer communication that
empowers consumers toexercise their right to informed choice and promotes
healthier diets. We respect consumerprivacy.

4. Human rights in our business activities

We fully support the United Nations Global Compact‘s (UNGC) guiding
principles on humanrights and labour and aim to provide an example of good
human rights‘ and labour practices
throughout our business activities.

5. Leadership and personal responsibility

Our success is based on our people. We treat each other with respect and dignity
and expecteveryone to promote a sense of personal responsibility. We recruit
competent and motivatedpeople who respect our values, provide equal
opportunities for their development andadvancement protect their privacy and
do not tolerate any form of harassment or discrimination.

6. Safety and health at work

We are committed to preventing accidents, injuries and illness related to work,
and to protectemployees, contractors and others involved along the value chain.

7. Supplier and customer relations

We require our suppliers, agents, subcontractors and their employees to
demonstrate honesty,integrity and fairness, and to adhere to our non-negotiable
standards. In the same way, we arecommitted towards our own customers.

8. Agriculture and rural development

We contribute to improvements in agricultural production, the social and
economic status of farmers, rural communities and in production systems to
make them more environmentallysustainable.

24

9. Environmental sustainability
We commit ourselves to environmentally sustainable business practices. At all
stages of theproduct life cycle we strive to use natural resources efficiently,
favour the use of sustainably-managed renewable resources, and target zero
waste.

10. Water
We are committed to the sustainable use of water and continuous improvement
in watermanagement. We recognise that the world faces a growing water
challenge and that responsible
management of the world‘s resources by all water users is an absolute necessity.
Nestlé continues to maintain its commitment to follow and respect all applicable
local laws ineach of its markets

25
MARKETING ENVIRONMENTEXTERNAL
ENVIRONMENTDemographic External factor

More the education more will be the awareness about brand and quality food.

If the income level of people is high then purchasing power will be high so they
willpurchase more.

Nestle products are made for people belonging from all age groups.
Both male/female are included equally in its target market.
Economic environment

If the inflation rate is high then there will be decrease in purchasing power. so
inflation
indirectly affects the company‘s sale.

Nation varies greatly in its level and distribution of income.

Changes in major economic variables such as income, cost of living, interest

rate andsavings have a large impact on the market place.
Political environment

Government regulations to protect interest of society and from unfair business

practices.

Unstable political conditions.

Law order situation getting worse.

26
Legal environment

Registered in the stock exchanges of Pakistan.

Social/cultural environment

Consumption behavior of Pakistani people is high so they consume more goods.

As Pakistan is Muslim country so we cannot add any ingredient which is
prohibited in
Islam or which is not ―Halal‖.

As nestle water is the branded item so the people who are brand conscious will
prefer touse nestle water .so nestle is focusing more on the posh areas.
Technological environment

Technological environment is changing rapidly.

Most dramatic force shaping company‘s offerings and the way product is
marketed
.

Company‘s must keep up with technological changes t

o match up with its environment.
Internal Environment

In Nestle Internal environment ensures.

Employees are on side with the goals of an organization.

They have direct impact on product quality,dependability and overall

productivity.
They are internal market, which impact everydepartment within an
organization; asatisfied internalmarket will be better able to satisfy external
market.

Nestle under the supervision of top management runs thedepartments of

finance,operations, accounting, sales andmarketing, research and development
to achieve thegoalsof organization.
Micro Environment
In Nestle microenvironment includes
:a)
Suppliers
:
Suppliers provide the resources like labor and material resources to produce
goods and services.They add to customer overall value delivery system. Labor
supplies include handling of

Quantity of labor

Quality of labor

Labor strikes

Labor relations Material supplies deals with the

:

Quality of material

Price of material

Stability of material inputs

27

Delivery delaysNestle efficiently handles the quality, quantity, price and

stability of both material and laborsupplies. Management maps out the
strategies for labor strikes, supply short age sand delays toavoid increasing the
cost of production, which can badly affect sales in short run and
customersatisfaction in long run.
b)
Marketing Intermediaries
:

It includes the firms that help the company to promote, sell and distribute its
goods tofinal buyers.

The physical distribution firms determine the ways to store and ship goods to
reach theirdestination.

Marketing service agencies including marketing research firms, advertising

agencies andmedia firmsare also hired to target and promote product to right
market.

Financial intermediaries like banks, insurance companies helps to finance

transactionsand insureagainst risks associated with buying and selling of goods.

Nestle works in coordination with marketing intermediaries to make its product

Pure LifeWater available and visible to its valuable customers.
c)
C u s t o m e r s
:
Nestle deals with the reseller customers who buy the product Pure Life to resell
at a reasonableprofit.
Macro Environment
Macro environment include political, cultural, economical factors but as for as
Nestle Pure LifeWater is concern none of above factors affect on it. Because it
is not at luxury item they areselling necessities of life which can never be
affected.
NESTLE’S DEFINATION OF MARKETING

Building customer relationship based on customer values and satisfaction is at

the very heart of modern marketing. The two fold goals of nestle marketing is to
attract new customers byproviding superior value and to keep and grow the
current customer by delivering satisfaction.Nestle defines marketing as
:
“
A social and managerial process whereby individual and group obtains
good food andgood life through creating and exchanging products and
values
”

MARKETING MIX
Elements of the marketing mix are often referred to as the "
Four 'P's
a phrase used sincethe1960's

Product - It is a tangible good or an intangible service that is mass produced or

manufactured ona large scale with a specific volume of units. Intangible
products are service based like thetourism industry & the hotel industry or
codes-based products like cell phone load and credits.Typical examples of a
mass produced tangible object are the motor car and the disposable razor.A less
obvious but ubiquitous mass produced service is a computer operating system.
Packagingalso needs to be taken into consideration. Every product is subject to
a life-cycle including agrowth phase followed by an eventual period of decline
as the product approaches marketsaturation. To retain its competitiveness in the
market, product differentiation is required and isone of the strategies to
differentiate a product from its competitors.

30

Price
–
The price is the amount a customer pays for the product. The business may
increase ordecrease the price of product if other stores have the same product.

Promotion
–

It represents all of the communications that a marketer may use in the

marketplace.Promotion has four distinct elements: advertising, public relations,
personal selling and salespromotion. A certain amount of crossover occurs
when promotion uses the four principalelements together, which is common in
film promotion. Advertising covers any communicationthat is paid for, from
cinema commercials, radio and Internet adverts through print media
andbillboards. Public relations are where the communication is not directly paid
for and includespress releases, sponsorship deals, exhibitions, conferences,
seminars or trade fairs and events.Word of mouth is any apparently informal
communication about the product by ordinaryindividuals, satisfied customers or
people specifically engaged to create word of mouthmomentum. Sales staff
often plays an important role in word of mouth and Public Relations.

Place
–
A way of getting the product to the consumer and/or how easily accessible it is
toconsumers.

31
MARKETING MIX OF NESTLE
Nestle, a very well known brand that is now housing thousands of products was
primarily formedfor helping the infants survival who could notfeedon mothers
lactation., its first product being"Farine Lactee Henri Nestle". The brand was
introduced by Henry Russel in 1866, which wasboosted up by its merger in
1905 with Anglo SwissMilkCompany, headquartered in Vevey,Switzerland.
roduct
• Being the world‘s largest
food and nutrition company almost six thousand products are beinghosted under
the brand named Nestle.
• Its products are very wide spread in range
counting almost all daily use products as well asoccasionally used products. The
products includes coffee, bottled water, cereals, pharmaceuticalproducts like
lens care solutions, infant food, beverages, chocolates, candies, ice
creams,refrigerated foods, yogurt,milkcream a very unusual product that is pet
food and the largestselling brand milkman. All these categories are subdivided
to the diverse choices of customersincluding different sizes and flavors (Kowitt,
2010).
• Products that are introduced in the market are first screened through high
profile research anddevelopmentsector including food processing, micro
analytical research and proper delivery of functionalities in the food products
thus promising the healthy goods for consumers.
• Main raw material for its milk products are UHT treated and packed in tetra
packaging,moreover the packaging is long lasting as well as tempting.
• As hygiene is a basic ethical question for edible products, so Nestle has a full
concern and
focuson this parameter.
• Nestle provides the product compliance to the customers including all l
egal supports.
• Nutrition quality is preferably determined and is provided on the packing of
the product to
facilitate consumers to check their preferences along with the expiry dates.
•
Complaints if any are timely responded and suggestions are always welcomed.

32
rice
• Flexible
prices are the key factor of success of Nestle in global markets for example
Milkpakbeing the largest selling brand is being sold out at the same price as that
of other low qualityproducts while maintaining its quality.
• Their marketing strategy includes a wide range of pricing strategy, and by
doing this they can
maintain their product rates at a sustainable position.
• Prices are affordable to almost all
typesof consumers as they have wide range of single productas in the case of
beverages, fruit juices are affordable to low economy class and expensive
tinpacked beverages are also doing business in the market.
• Bulk purchase discount is also provided at the whole sale markets as well as at
the market
stores.
 • Seasonal price variations are also seen, especially in the case of chocolate
products, either by
upsizing at the same price or reducing the sale price.

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ce
• Flexible
prices are the key factor of success of Nestle in global markets for example
Milkpakbeing the largest selling brand is being sold out at the same price as that
of other low qualityproducts while maintaining its quality.
• Their marketing strategy includes a wide range of pricing strategy, and by
doing this they can
maintain their product rates at a sustainable position.
• Prices are affordable to almost all
typesof consumers as they have wide range of single productas in the case of
beverages, fruit juices are affordable to low economy class and expensive
tinpacked beverages are also doing business in the market.
• Bulk purchase discount is also provided at the whole sale markets as well as at
the market
stores.
• Seasonal price variations are also seen, especially in the case of chocolate
products, either by
upsizing at the same price or reducing the sale price.

ace
• Nestle products have their main business area in Europe from where they get
almost 90 percent
of the sales and revenues.
• Nestle is running globally, its setup being run in 86 countries. So, the
sales are also doneglobally and are impulsive ones.
• The products are not directly thrown into the market, rather a full procedure is
followed
including all the essentials from Manufacturer, Distributor, Wholesaler, Retailer
and finally toConsumer.
•N
estle products are available in all its variety at the maximum outlets, as the
company isalways looking forward to expand its outlets

omotion
• Promotion strategies of the company are very well planned and they always
pay
multiples of the expected amounts.
•
Advertising on electronic and print media along with sign boards having
temptingfigurations of the brand always proves good for the brand
• Sometimes limited economy offers boost up the popularity of brand especially
in the case whennew induction to the market is made.
i. NESTLE EVERYDAY:
To meet the requirements of the tea-whitening segment, this product was
launched in 1986. Onaccount of aggressive marketing, focused distribution,
excellent consumer acceptance andproduct quality, this brand has shown strong
growth and holds good promise for the future.

NESTLE MILKMAID:
It is a Partly Skimmed Sweetened Condensed Milk. NESTLÉ MILKMAID is a
versatile productand excellent as a dessert ingredient. Lip-smacking desserts can
be whipped up in the shortestpossible time. NESTLÉ MILKMAID is a globally
recognized and popular brand of Nestlé. It hasbeen available in India ever since
the Company first started importing and selling its productsover 90 years ago.
iii. NESTLE DAHI:
is made from fresh, high quality pasteurised toned milk. It has all the goodness
of naturalCalcium and the Cultures used in NESTLÉ Dahi help improve
digestion. It comes available foryour convenience in 85g, 200g and 400g Tubs
and 200g and 1kg Pouch packs.The pouch packs are currently available only in
Delhi NCR.

BEVERAGES

i. NESCAFÉ CLASSIC:
It is 100% Pure Instant Coffee. NESCAFÉ CLASSIC has the unmistakable taste
of 100% purecoffee and is made from carefully selected coffee beans picked
from the finest plantations,
blended and roasted to perfection. 100% coffee…100% pleasure…
NESTEA:

New NESTEA Iced Tea with Green Tea brings natural, healthy goodness of
Green tea into yourglass. Green tea is a good source of NATURAL
ANTIOXIDANTS which are known to protectbody cells from damage caused
by free radicals. Feel good everyday with the refreshingly lighttaste of NESTEA
with Green Tea.

NESCAFÉ

CAPPUCCINO:
The world's favourite instant coffee brand NESCAFÉ brings two delicious new
Cappuccinovariants - NESCAFÉ Choco Mocha and NESCAFÉ Vanilla Latte.
Treat yourself to its richcoffee taste and delicious froth. Comforting, relaxing - a
delicious cup of NESCAFÉ Cappuccinois a great way to enjoy a true café
experience at home
CHOCOLATESi. MILKYBAR CHOO:
MILKYBAR CHOO - the tasty chewy MILKYBAR - now has power of
Calcium! Outdoorchampions, grab one now. Also available in yummy
Strawberry and Choko flavours!!mm, mm, mmmmmmmmm.....
MILKYBAR ECLAIRS:
Introducing a delicious new wave of strawberry flavour in your favourites
MILKYBAR Éclairs
FINDINGS AND ANALYSIS

Synonym for baby food.

Brand name, quality and flavor are most important factors.

All occasion items and targeted towards whole family.

Aiming to set up their presence in food industry without compromising with

quality.

NESTLE is a flagship brand.

SUGGESTION &RECOMMENDATION

Nestle is the best company all over the world but there are some
recommendation andsuggestions.

Their prices are bit higher so they should low their prices to increase their
customers.

About 70% people

use their products while the rest don‘t use them. They should conduct
survey and concentrate on those facts why people are nto using their products.

They should also improve their advertising as their advertising doesn‘t pay long
-termeffects in the mind of customers.

About 17% people are not satisfied from the taste of nestle so nestle has to
improve itstaste.Recommendation

Keep the taste nice.

Increase advertising and show your competitive edge.

Increase loyalty of customer with brand through attractive packages.

Keep the price low because the day when price of competitor will be very near
to yourprice your sales will boost up.

Increase its distribution network.

Try to get more & more party orders.

Increase incentive and promotional activities, traning courses/workshops for

team.

Conduct weekly meetings with distributors and sales team in order to review
weeklytarget closing.

61
CHAPTER-8CONCLUSION

62
Nestle is a market leader due to different reasons:
Its price is high against its competitors but it matches its quality with its
competitors.

Nestle is using its brand name to promote its products & it‘s very popular as
compared to
its competitors.

Its packaging is good.

We can easily find Nestle from any retailer shop.

Due to its advertisement, Nestle attracts more customers & has very prosperous
future if it continues to promote its products and bring all the possible
innovational aspects usingdifferent product line strategies.

It has always maintained the quality of its products.

Despite of all the facts, there‘s need to maintain

the condition of office and enhance thesecurity.

Behavior of employees is not professional and every department should treat

equally.From our report it is concluded that nestle has a good reputation as a
strong consumer brand.66% of the consumers us
e Nestlé‘s products regularly. 60% of the consumer‘s associate quality
with Nestle.57.3 % of the consumers prefers Nestle over other brands of pure
water that areavailable in the market. Nestle formulating a good strategy and
they are trying to go for mass-marketing

63
BIBLOGRAPHYBooks:
•
Kotler Philip
(Eighth Edition) ―Marketing Management‖, Prentice Hall of India Ltd.

• T.N.Chhabra
(Fourth Edition)
―Marketing Management‖
, Dhanpat Rai & Co.(Pvt.) Ltd.
Magazines:
• Advertising and marketing Magazine

• The Economic Times –

―Brand Equity‖

• Company Literature

• Business World

• Business Today

Website:
• www.nestle.com

• www.moneycontrol.com

• www.iloveindia.com

• www.shine.com

•
http://www.thetimes100.co.uk
• http://www.deloitte.com/view/en_GX/global/services/consulting/enterprise
-applications/08645de9542fb110VgnVCM100000ba42f00aRCRD.htm
• http://www.coursework.info/University/Business_and_Administrative_studies
/Economics/
Microeconomics/PEST_Model_L61591.html
• http://www.scribd.com/doc/21544545/Introduction
-Nestle-Was-Founded-in-1866-by-HenriNestle-And
• http://kninn.blogspot.com/2010/06/recommendations
-for-nestle.html