success story of nestlé milkmaid
TRANSCRIPT
SUCCESS STORY OF NESTLÉ MILKMAID
Submitted by:
MD SADIQUE SULEMAN
DM16D19
CM 2
NESTLÉ MILKMAID
FMCG Industry
The fast moving consumer goods (FMCG) segment is the fourth
largest sector in the Indian economy
FMCG market is expected to increase at (CAGR) of 14.7 per cent
to touch US$ 110.4 billion during 2012-2020
Expected to increase at compound annual growth rate (CAGR) of
14.7 per cent
MARKET SHARE
43
22
12
8
4
42 5
food product personal care fabric care hair care households otc products baby care others
NESTLÉ MILKMAID
‘Food products’ is the leading segment, accounting for 43.0 per
cent of the overall market
Personal care (22.0 per cent) and fabric care (12.0 per cent) are the
other leading segments
The rural FMCG market expected to increase at a CAGR of 16.3
per cent to USD100 billion during 2011–25
The FMCG sector has grown at an annual average of about 11 per
cent over the last decade
THE FMCG MARKEG HAS FOUR SEGMENT
FMCG
HOUSEHOLD
CARE PERSONAL
CARE FOOD &
BEVERAGE HEALTH CARE
Health beverages,
staples/cereals, bakery
products, snacks,
chocolates, ice cream,
tea/coffee/soft drinks,
processed fruits and
vegetables, dairy products,
and branded flour
Fabric wash,
Household
cleaners
Oral care, hair care,
skin care,
cosmetics/deodorant
s, perfumes, feminine
hygiene and paper
products
OTC products and
ethicals
NESTLÉ MILKMAID
FMCG REVENUES OVER THE YEARS (USD billion)
THE URBAN SEGMENT IS THE LARGEST CONTRIBUTOR
1 2 3 4 5 6 7
Series2 15.7 17.8 21.3 24.2 30.2 34.8 36.8
Series1 2006 2007 2008 2009 2010 2011 2012
66.5
33.5
urban rural
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FMCG GROWTH DRIVERS
Rising incomes
Driving purchase
Desire to experiment with brands
Evolving consumer lifestyle
New product launches
Growth of modern trade
Availability of online channel to shop
Increasing consumer demand
Greater awareness of products, brands
MARKET SHARE
36.4
30
8.2
6
4.3
15.1
HUL ITC NESTLE BRITANIA DABUR OTHERS
NESTLÉ MILKMAID
COMPANY INFORMATION:: NESTLE
Founded 1866; 150 years ago (as Anglo-Swiss Condensed
Milk Company)
1867 (as Farine Lactée Henri Nestlé)
1905 (as Nestlé and Anglo-Swiss Condensed Milk
Company)
Founder Henri Nestlé, Charles Page, George Page
Nestlé S.A. is a Swiss transnational food and drink company
headquartered in Vevey, Vaud, Switzerland. It has been the
largest food company in the world
NESTLÉ MILKMAID
On 28th March 1959, the Company was incorporated at New
Delhi. The Company was promoted by Nestle Alimentana
S.A. through a wholly owned subsidiary, Nestle Holdings Ltd
Parent Company Nestle Ltd
Category Food Products
Sector Food and Beverages
Tagline/ Slogan Good Food, Good Life
USP
The biggest health and wellness brand in the world, top
brand in Fortune 500 list
STP
Segment
People looking for premium quality, and branded
products like foods, dairy products, baby food, pet food,
confectioneries, etc.
Target Group Urban middle and upper middle class
Positioning
A world class brand providing good quality, healthy and
tasty food and beverages
PRODUCT PORTFOLIO
Brands Milky bar
MilkMaid
NESTLÉ MILKMAID
Everyday Dairy Whitener
Nescafe
Maggi Noodles
Kit kat
Bar One
8. Polo
SWOT ANALYSIS
Strengths
More than 140 years in the industry
World biggest brand, top brand in Fortune 500 list
Global reach with presence in over 86 countries
An employee strength of around 328,000 people
worldwide
Wide product range including baby food, pet food,
dairy products, confectioneries, pharmaceuticals,
beverages, etc.
Popular brands owned like Maggi, Haagen-Dazs,
Boost, Kit Kat, Nescafe, etc.
Largest R&D network facilitating continuous
innovation
Strong supply chain network
C.S.R. activities for rural development, environment
protection, water conservation,, etc.
Mergers and acquisitions and joint ventures to
increase market share
Strong marketing and advertising power
Strong brand loyalty and brand recall
Weaknesses
Being a big global brand, Numerous controversies
in different countries of operation can cause issues
Strong competition by other brands
NESTLÉ MILKMAID
Opportunities
Introduce more health based food products to tap
the health consciousness amongst consumers
Expand with focus on developing economies
Continue with acquisitions and joint ventures to
increase its market share
Try to capture the rural markets
Threats
Failure of the complex supply chain
Economic instability and inflation in most countries
EURO zone crisis, as most of its revenue comes
from Europe
Increase in cost of raw materials
Stiff competition in all product segment
SHARE HOLDING PATTERN
Holder's Name No of Shares % Share Holding
Foreign Institutions 13660675 14.17%
Foreign Promoter 60515079 62.76%
General Public 13567332 14.07%
Financial Institutions 4430835 4.6%
Others 2931451 3.04%
N Banks Mutual Funds 1257767 1.3%
NESTLÉ MILKMAID
Central Govt 52577 0.05%
COMPETITORS
Name Market Cap.
(Rs. cr.)
Sales
Turnover
Net Profit Total Assets
Nestle 58,960.14 8,175.31 563.27 2,835.57
Britannia 34,743.84 7,955.72 764.98 1,703.51
GlaxoSmith Con 21,440.54 4,308.73 686.91 2,445.65
KRBL 6,992.26 3,358.85 371.37 2,677.65
14
63
14
53 1
0
ForeignInstitutions ForeignPromoter GeneralPublic FinancialInstitutions Others NBanksMutualFunds CentralGovt
NESTLÉ MILKMAID
Hatsun Agro 5,325.89 3,444.59 60.50 749.90
Coffee Day 4,116.94 48.72 -110.52 2,405.37
Manpasand Bever 3,234.43 556.71 50.56 601.57
Kwality 3,031.53 5,724.23 144.25 2,059.29
Parag Milk Food 2,226.09 1,622.95 52.51 737.79
Heritage Foods 1,985.83 2,380.58 55.43 345.10
Prabhat Dairy 966.02 999.70 9.39 616.85
MARKET SHARE
36.4
30
8.2
6
4.3
15.1
HUL ITC NESTLE BRITANIA DABUR OTHERS
NESTLÉ MILKMAID
PRODUCTS
TAG LINE
Argentina: “Change the day start within”
Germany: Give yourself a break”
United States: “The smart choice”
India: “good food good life”
STORY OF MILKMAID
NESTLÉ MILKMAID
MilkMaid
Parent Company Nestle
Category Food product
Sector Food Products
Tagline/ Slogan Doodh badla mood badla ;Good Food Good Life
USP Condensed milk sweet dish ingredient
STP
Segment Homemakers who prepare sweet dishes
Target Group
All People especially housewives between 25-50 middle
and upper class
Positioning Sweetened milk for making sweets
SWOT Analysis
Strengths
1. Strong Nestle brand name
2.Excellent advertising and visibility
3.Good product distribution and availability
4. Recipes help in brand promotion
Weaknesses 1. Not good for diabetic patients
NESTLÉ MILKMAID
2.Food products have a limited shelf life
Opportunities 1.Low sugar version
Threats
1.Threat from pure milk
2.Substitute milk sweeteners
Competition
Competitors 1.Amul Mithaimate
NESTLÉ MILKMAID a name synonymous with delicious
desserts has been delighting generations of Indian consumers over
the past 100 years
MILKMAID defined Nestlé’s ‘sweet’ entry into India – It was the
first brand to be traded by the company in India
Its convenient format and versatile nature allows you to prepare a
plethora of traditional as well as contemporary desserts
CONTRIBUTION
NESTLÉ MILKMAID
The American brothers and Nestlé forefathers who built Europe’s first
condensed milk factory in 1866
NESTLÉ MILKMAID
Nowadays when we pour pasteurized fresh milk onto our breakfast
cereal, or sweetened condensed milk onto our dessert, we take it for
granted that such staple foods are safe.
This wasn’t always the case. Until the nineteenth century, pure, fresh
milk was a prized commodity in towns and cities across Europe. Milk
was often a major carrier of disease, as refrigeration was uncommon and
it quickly spoiled. Milk adulteration was also rife and could kill. Chalk,
water and other substances were often added.
This was the situation that Charles found when he arrived in Zurich in
1865, as a young US Vice Consul of Trade. Yet in the Swiss countryside
he saw cows grazing on fresh, green meadows. This made him think of a
popular new American foodstuff that, as a journalist covering the
country’s Civil War, he had seen issued to Union troops.
Europe’s first condensed milk factory
Invented by Gail Borden in the early 1850s, canned condensed milk
proved invaluable as a military ration in the 1860s. While fresh milk had
spoiled due to long supply chains, canned milk was nutritious, portable,
long-lasting and, crucially, safe. Little surprise then, that sales exploded
in US towns and cities after the war.
Hoping for similar success in Europe, Charles Page founded the Anglo-
Swiss Condensed Milk Company in Cham, Switzerland, in 1866. At this
time George was in the US learning Gail Borden’s pioneering process
for producing condensed milk. This involved heating milk to evaporate
some of the water, then adding sugar as a preservative.
NESTLÉ MILKMAID
Left to right: George Page, Charles Page
A year later, the Pages opened Europe’s first condensed milk factory in
Cham, and their Milkmaid Brand began to roll off the production line.
High standards of quality and safety, a modern factory, efficient
distribution and savvy marketing ensured the product was a success. The
brand that began Nestlé’s 150-year history is still sold today as Nestlé
Milkmaid.
As early as 1868, Anglo-Swiss sold over 374,000 cartons of condensed
milk. Demand was led by Great Britain and its colonies, whose appetite
for condensed milk had inspired the brothers to choose their company
name. Charles died in in 1873, and by 1891 George was managing a
business with 12 factories across Europe and the US that exported
worldwide.
‘The General’ proves an enlightened leader
George Page, or ‘The General’ was the driving force behind Anglo-
Swiss. An enlightened man, he understood that long-term business
success meant behaving responsibly: towards suppliers, employees and
NESTLÉ MILKMAID
society. In this respect Anglo-Swiss foreshadowed Nestlé’s approach to
Creating Shared Value.
Anglo-Swiss used only fresh milk from local cows, and farmers were
guaranteed payment for daily supplies at an agreed price. Milk was
delivered to the factory in steam-cleaned churns, and tested in a
laboratory for its fat content and purity.
Farmers were given technical help to increase milk quality and quantity,
and George Page encouraged advanced methods for keeping and feeding
cattle. Such a scientific approach to dairy farming was extremely rare in
the 1860s, and served as the early model for Nestlé’s modern-day ‘milk
district’ model.
Page’s treatment of his workforce was similarly advanced for the era.
Anglo-Swiss staff who fell ill were given pay when they were sick or
suffered workplace accidents, rather than simply sacked. They could
also join a voluntary health insurance scheme. George Page built
housing for staff in Cham and a kindergarten for their children.
Sharing Nestlé’s passion for nutrition
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As a progressive employer, Page had a lot in common with another
recent immigrant to Switzerland, the German Henri Nestlé. A similar
passion for nutrition and social purpose inspired Nestlé to invent
his Farine Lactée infant food, which he sold from 1867 in Vevey.
After 1878, Henri Nestlé’s company and Anglo-Swiss became direct
rivals, as the two firms each began producing versions of the other’s
core product, which their customers liked to buy together.
Despite this rivalry, the two companies thrived while other competitors
failed. This is because they won trust through unstinting quality
standards. Both used the same ingredient, milk, to provide essential
science-based nutrition.
A merger of equals made sense. George Page, who had opposed a deal
on these terms, died in 1899. In 1905 the agreement was signed, and the
Nestlé and Anglo-Swiss Condensed Milk Company was born.
NESTLÉ MILKMAID
Nestle Milkmaid is the market leader in the Rs 150 Crore condensed
milk market in India. Milkmaid is a heritage brand which
was imported to India from the time Nestle started its operations 90
years ago. It was in the year 1969 that Nestle started manufacturing this
brand in India.
Milkmaid is partly Skimmed sweetened condensed milk. This is a
popular ingredient in sweets and delicacies and desserts prepared at
homes. Milkmaid has more than 55 % share in the organized condensed
milk market in India.
Milkmaid is positioned as a premium brand and is promoted with the
tagline "Bana De Everything Tempting" ( Makes everything tempting).
The brand is positioned as the inevitable ingredient in all home-made
delicacies.
Milkmaid although was a market leader, the brand faced issue of product
usage. There were certain factors that inhibited the product usage: price
and convenience. Milkmaid was a premium brand and the
shelf life of the product was limited, hence the affordability of this brand
was limited. Another factor was that many households were unaware of
the use of Milkmaid other than as an ingredient in sweets and desserts.
The brand tried lot of promotional activities to increase the usage of the
brand. The brand was promoted heavily through visual media and
through cookery shows, the brand tried to educate the customers on the
various recipes with Milkmaid.
The brand also came out with a package innovation. The brand created a
variant Milkmaid Squeezy which was the tube form of Milkmaid. The
purpose was to use Milkmaid as a topping for biscuits and breads.
NESTLÉ MILKMAID
Milkmaid faced intense heat of competition when Amul launched
Mithaimate brand in the market. Mithaimate was priced much lower to
Milkmaid and this forced Milkmaid to reduce the price to match the
Amul brand. With the lower price, Amul was giving Milkmaid a tough
fight for the market share.
This year saw a unique move by this brand. Milkmaid has come out with
a brand extension. Milkmaid has recently launched Milkmaid Funshake:
a fruit flavored milk targeting kids. The marketers predict a huge growth
in the ' Alternate Milk Category “in the coming years. I think that Nestle
had earlier tried out a Milkshake version of Nescafe but with little
success. It was little surprising to find a brand like Milkmaid extending
itself to a milk shake category. The ads are already on air. Funshake is
available in Mango, banana and Chocolate flavor and comes in a tetra
pack. The message is similar to Nido. The ad shows kids crying when
their mothers try to give them ordinary milk and then seen enjoying
taking Funshake. Old message and nothing new in execution.
In my personal opinion, Nestle needn't have sought the extension of
Milkmaid for this product. Funshake could succeed as a standalone
brand. By associating with Milkmaid, Funshake is not going to gain any
positive association.
NESTLÉ MILKMAID
DIVERSITY
Why it’s important
Nestle already a highly diverse organization in terms of
geographical spread and employee profile. Diversity and gender
balance must stay at the top agenda – enabling to draw from an
ever broader, larger talent pool; make better-informed decisions;
and deliver more robust consumer insights
Diversifying talent at Nestlé will focus on attracting, engaging and
developing people to ensure the right mix of talent to meet current
and future business needs
CONSUMER PREFERENCE
All marketing starts with the consumer. So consumer is a very
important person to a marketer. Consumer decides what to
purchase, for whom to purchase, why to purchase, from where to
purchase, and how much to purchase. In order to become a
successful marketer, he must know the liking or disliking of the
customers. He must also know the time and the quantity of goods
and services, a consumer may purchase, so that he may store the
goods or provide the services according to the likings of the
consumers. Gone are the days when the concept of market
was let the buyer’s beware or when the market was mainly the
seller’s market . Now the whole concept of consumer’s
sovereignty prevails. The manufacturers produce and the sellers sell
whatever the consumer likes. In this sense, “consumer is the supreme in
the market”. As consumers, we play a very vital role in the health
NESTLÉ MILKMAID
of the economy local, national or international. The decision we
make concerning our consumption behavior affect the demand
for the basic raw materials , for the transportat ion, for the
banking, for the production; they effect the employment of
workers and deployment of resources and success of some
industries and failures of others. Thus marketer must understand this.
Consumer buying process starts from recognition of the need for a
product, searching information about available alternatives,
evaluating these alternatives, deciding which product should be
purchased, actual purchase and analysis of behavior of buyer after
the purchase
Consumer buying behavior can be impulse buying,
routine/everyday decision making, limited decision making to
extensive decision making
Cultural, social, personal and psychological factors influence
consumer’s buying behavior
To design effective strategy, it is essential to understand how
consumers take buying decisions
Marketers need to categorize who influences the purchase, who
decides, who purchases and who finally uses the product
NESTLÉ MILKMAID
Target marketing includes market segmentation, targeting and
positioning
Segmentation can be done on the basis of geography, demography,
behavior or psychographics
It is effective and viable only if segments are measurable,
substantial, accessible, differentiable and actionable