Principles of Marketing: Final project
1
Maryam Razaque FA13-DDP BBA-019
Acknowledgements Praise and thanks to Allah, the lord o uni!erse "ho is either o all kno"led#e and "isdom to mankind$ %e &o" our head in #ratitude to almi#hty Allah "ho &lessed us "ith the 'a(a&ility to 'om(lete our (ro)e't, "hi'h "as a 'hallen#e or us$*%e the #rou( mem&ers "ould like to a!ail this o((ortunity to thank our 'ourse instru'tor o Prin'i(les o Marketin#, Miss +ahira mair or his 'oo(eration and and su su(( ((or ortt as a tea' tea'he herr$ %e eel eel (l (lea easu surre in e.(r .(ressi essin# n# hear heart tel eltt #rat #ratit itud ude e to our our ami amili lies es or or thei theirr en'o en'our ura# a#em emen entt a/e'tion, su((ort, 'onstant hel( and (rayers at all times "ithout "hi'h it "as not (ossi&le or us to a'hie!e this tar#et
Table of content c ontents: s: Acknowledgements
Executive summary______________________________________________________4 Company Introduction !istory" mission" vision etc#__________________________________$ Company%s Marketing &epartment 'ierarc!y_______________________________________( Company )usiness Portfolio_____________________________________________________* C!osen )rand +ame" ,ogo" ,aunc!ing -ime" .logan" -arget -arget Market" /alue /alue proposition#_____0 Current Marketing mix_________________________________________________________12 Customer 3 driven Marketing strategy !ic! your Product follo5#_____________________16 7pply )C8 Matrix and Product market expansion grid on your c!osen 9rand_____________14 External ; internal factors affecting t!e 9rand ____________________________________1( .<- analysis_______________________________________________________________2= Product classification" company Product line ; product lifecycle_______________________26 Pricing .trategy ,aunc!ing Period#______________________________________________24 )rand Positioning" Personality ; 9rand strategy_____________________________________24 C!annel of distri9ution_________________________________________________________2( Competitive advantage ; Competitor 7nalysis__________________________________ 7nalysis_____________________________________20 ___20 -ools of promotion mix > IMC used 9y company for selected 9rand_____________________61 Current 7dvertising campaign Prefera9ly electronic Media Commercial#________________6$ Conclusion__________________________________________________________________6( ?eferences__________________________________________________________________60
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Executive Summary: -!is is an informative report in nestle Pakistan private limited" in t!is report 5e !ave descri9ed !o5 nestle came into 9eing internationally and in Pakistan -!roug! our researc! 5e found out !o5 muc! +estle cares a9out its customers 8ood food 8ood life is t!e principal t!ey al5ays follo5 e !ave descri9ed t!e marketing strategies nestle uses and 5e !ave explained t!eir performance of nestle +estle Pakistan limited formally kno5n as nestle Milkpak limited is a su9sidiary of nestle a company of .5iss origin !ead@uartered in /evey" .5itAerland It is listed on Barac!i and ,a!ore stock exc!anges For $ years in a ro5 t!e company !as successfully placed itself amongst top 2$ companies of B.E Its principal activities are to manufacture process and sell food product. +oodles" 9a9y food" and infant formula milk and 9reakfast cereals in Pakistan +estle is a lo5 cost leader 5it! its efficient operations !ence it provides its customers 5it! !ig! @uality products and sells t!em at a premium price -!erefore it is earning good profits +estle !as set its manufacturing plants at in Barac!i" ,a!ore" Islama9ad and Ba9ir5ala -!e milk processing plant at Ba9ir5ala Ba 9ir5ala district is t!e +estl%s 5orld largest milk processing plant !en nestle introduced its products in Pakistan people 5ere neit!er a5are nor accustomed to t!em -!erefore nestle ran an extensive marketing campaign to educate people and create a need for its products In t!is report 5e did several types of marketing analysis on Milkpak suc! as .<- analysis" external and internal factors" 9rand personality" 9rand positioning" 9rand strategy etc
NESTLE MILK PAK Introduction: +estl Pakistan is proud of its commitment to excellence in product safety and @uality and to providing value and aims to 9e t!e leading +utrition" 'ealt! and ellness Company 7s a socially responsi9le corporate" 5e al5ays focus on environment friendly operations" et!ical 9usiness practices and our responsi9ility to5ards t!e communities +estl in Pakistan is operating since 10** under a joint venture 5it! Milk Pak ltd and took over management in 1002 -!e company%s strategy is guided 9y +estl%s Corporate )usiness Principles 5!ic! are in line 5it! internationally accepted 9est practices and et!ical performance culture +estl%s existing products gro5 t!roug! innovation and renovation 5!ile maintaining a 9alance in geograp!ic activities and product lines ,ongDterm potential is never sacrificed for s!ortDterm performance -!e Company%s priority is to 9ring t!e 9est and most relevant products to people" 5!erever t!ey are" 5!atever t!eir needs are" and for all age groups +estl Pakistan today is t!e leading Food ; )everages Company in Pakistan 5it! key focus on +utrition" 'ealt! and ellness and reac!ing t!e remotest of locations t!roug!out Pakistan to serve t!e consumers +estl Pakistan also prides itself in 9eing t!e leaders in +utrition" 'ealt! ; ellness Ever since 1*(" 5!en 'enri +estl invented t!e first infant food" nutrition !as 9een in our &+7 -oday more and more consumers mirror our emp!asis on nutrition" as t!ey realiAe t!at food c!oices affect t!eir !ealt! and @uality of life +estl Pakistan operates in many 5ays 9ut people" products and 9rands are t!e main flag 9earers of t!e Company%s image" and 5e continue to en!ance t!e @uality of life of Pakistanis
History: 18601!0"
In t!e 1*=s 'enri +estl" a p!armacist" developed a food for 9a9ies 5!o 5ere una9le to 9reastfeed 'is first success 5as a premature infant 5!o could not tolerate !is mot!ers milk or any of t!e usual su9stitutes People @uickly recogniAed t!e value of t!e ne5 product" after +estls ne5 formula saved t!e c!ilds life" and soon" Farine ,acte 'enri +estl 5as 9eing sold in muc! of Europe 'enri +estl endo5ed !is company 5it! t!e sym9ol derived from !is name 'is family coat of arms" t!e nest 5it! a mot!er 9ird protecting !er young" 9ecame t!e Companys logo and a sym9ol of t!e Companys care and attitude to lifeDlong nutrition -!e +estl nest represents t!e nouris!ment"security and sense of family t!at are so essential to life 1!0"1!#8 2
In 10=$ +estl merged 5it! t!e 7ngloD.5iss Condensed Milk Company )y t!e early 10==s" t!e company 5as operating factories in t!e Gnited .tates" )ritain" 8ermany and .pain orld ar I created ne5 demand for dairy products in t!e form of government contracts )y t!e end of t!e 5ar" +estl%s production !ad more t!an dou9led 7fter t!e 5ar 8overnmentcontracts dried up and consumers s5itc!ed 9ack to fres! milk 'o5ever" +estl%s management responded @uickly" streamlining operations andreducing de9t -!e 102=s sa5 +estls first expansion into ne5 products" 5it! c!ocolate t!e Companys second most important activity 1!#81!$"
+estl felt t!e effects of orld ar II immediately Profits dropped fromH2= million in 106* to H million in 1060 Factories 5ere esta9lis!ed in developing countries" particularly ,atin 7merica Ironically" t!e 5ar !elped 5it! t!e introduction of t!e Companys ne5est product" +escafe" 5!ic! 5as staple drink of t!e G. military +estls production and sales rose in t!e 5artime economy -!e end of orld ar II 5as t!e 9eginning of a dynamic p!ase for +estl 8ro5t! accelerated and companies 5ere ac@uired In 104( came a lot of mergers &iversification came 5it! a s!are!olding in ,%
+estl divested a num9er of 9usinesses10*= > 10*4 In 10*4" +estlsimproved 9ottom line allo5ed t!e Company to launc! a ne5 round of ac@uisitions" t!e most important 9eing 7merican food giant Carnation +estls gro5t! in t!e developing 5orld partially offset a slo5do5n in t!e Companys traditional markets 1!!6%000
-!e first !alf of t!e 100=s proved to 9e a favora9le time for +estl: trade 9arriers crum9led and 5orld economic markets developed into a series of more or less integrated trading areas -!e opening of Central and Eastern Europe" as 5ell as C!ina" and a general trend to5ards li9eraliAation of direct foreign investment 5as good ne5s for a company 5it! interests as farD flungand diverse as +estl !ile progress since t!en !as not 9een asencouraging" t!e overall trends remain positive +estl opened t!e 2=t! century 9y merging 5it! t!e 7ngloD.5iss Condensed Milk Company to 9roaden its product range and 5iden its geograp!ical scope %000&resent:
In uly 2===" +estl launc!ed a 8roupD5ide initiative called 8,<)E8lo9al )usiness Excellence#" aimed at !armoniAing and simplifying 9usiness process arc!itectureJ ena9ling +estl to realiAe t!e advantages of a glo9al leader 5!ile minimiAing t!e dra59acks of siAe +estl 5as First to Produce: Infant milk" Condensed milk" Milk c!ocolate" .olu9le coffee and FreeAeDdried coffee
'om&any (ission and )ision +estl%s mission" in t!e 5ords of our founder 'enri +estl" is to: Kpositively influence t!e social environment in 5!ic! 5e operate as responsi9le corporate citiAens" 5it! due regard for t!ose environmental standards and societal aspirations 5!ic! improve @uality of lifeL DD 'enri +estl" 1*$( ,ead a dynamic" passionate and professional 5orkforce 3 proud of our !eritage and positive a9out t!e future Meet t!e nutrition needs of consumers of all ages 3 from infancy to old age" from nutrition to pleasure" t!roug! an innovative portfolio of 9randed food and 9everage products of t!e !ig!est @uality &eliver s!are!older value t!roug! profita9le longDterm gro5t!" 5!ile continuing to play a significant and responsi9le role in t!e social" economic" and environmental sectors of Pakistan
Hierarc*ical details o+ (arketing ,e&artment +estle is a 9ig name and it is one of t!e 9est 9rand of t!e country !aving t!e largest market s!are in milk industry in Pakistan It is not only one person 5!o is marketing t!e milk pack everyone 5!o is part of +estle is marketing it If 5e make t!e !ierarc!y of t!e marketing of +estle Milk pack 5e 5ill find out t!at t!ere is a 9rand manager 5!o is responsi9le for all activities t!at 5ill take place in t!e marketing department under !im is su9 9rand manager 5!o is responsi9le in t!e a9sence of t!e 9rand manager -!ey are t!e top management and mostly decide 5!at to do and !o5 to do !at steps s!ould 9e taken to do t!e marketing Gnder t!em t!ere is a 5!ole marketing team 5!o 5ork according to t!e instructions 5!ic! t!ey !ave got from t!e top management -!is team is furt!er divided into su9 teams 7ll t!e decision regarding t!e -/ commercials" radio" ne5s paper and 9ill9oards are decided 9y t!e 9rand manager on t!e advice and on t!e 9ases of statistical calculations For example for placing a 9ill 9oard all calculations are made t!at 5!at siAe of 9ill9oard 5ill 9e suita9le" 5!ere s!ould 9e it place so t!at is 5ell seen" !o5 muc! s!ould 9e spend on it eit!er it is in our 9udget or not 7ll t!ese t!ings are taken in account and a lot of t!inking is done 9efore applying t!e idea
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-usiness ort+olio
+estl is committed to t!e follo5ing )usiness Principles in all countries" taking into account local legislation" cultural and religious practices: 1. Am/ient dairy
Milkpak +ido Every day
%. '*illed dairy
+estle plain yogurt +estle &a!i +estle Aeera raita +estle podina raita
#. -ottled water
+estle pure life mineral 5ater
. 'ulinary and +ood
Maggi
". -a/y +ood
Cerelac
6. -reak+ast cereal
+estle koko crunc! +estle milo +estle corn flakes +estle fitness
$. 'o++ee
+escafe classic +escafe gold +escafe 6in1 coffee
8. 'on+ectionary
+estle crunc! 5
+estle kitkat '*osen -rand:
(ilk&ak.
-rand ogo:
)rand logo is a stick dra5ing of a !ome 5it! MI,BP7B 5ritten under it" 5!ic! totally indicates t!at
9
aunc*ing time: Milkpak 5as t!erefore incorporated in anuary 10(0 and 9egan commercial production in +ovem9er 10*1 In 10*4 Milkpak started marketing t!e Frost line of fruit juices 5!ic! !ad 9een introduced a fe5 years earlier 9y Packages ,td +estle Milkpak 5as launc!ed almost t!ree decades 9ack and since t!en it s!ares t!e most market s!are
Slogan: 2ye!i !ai Doodh ka khalis maza”
3arget (arket: 4eogra&*ic Segmentation:
8eograp!ic segmentation approac! markets are divided into different units t!ese units may include nations states" countries or even may neig!9or!ood consumer often !ave different 9uying !a9its depending upon 5!ere t!y reside 8eograp!ically +estle !as 9een very successful in 10
targeting t!ose areas 5!ere its competitors are not easily availa9le .o +estle &elig!t 5ill !ave an advantage over its competitors in t!is case of all purpose milk +estle can use its current supply c!ain to deliver t!e milk Fto its target markets 7 large segment 9elongs to t!e nort!ern and rural areas of Pakistan5ill 9e covered 9y +estle 9ecause of strong distri9ution net5ork -!ere is a gap in t!e supply cycle of milk in some critical situations 5!en s!ortage occurs due to s!ort of ra5 material supply rovince wise Segmentation: • • • •
.I+&' PG+7) )7,
,emogra&*ic Segmentation:
&ividing t!e market in t!e 9asis of demograp!ic varia9les suc! as age sex" family siAe" education" income" and social classes are called demograp!ics segmentations +estle is currently targeting !ouse 5ives" people of all ages especially gro5ing c!ildren on 9asis of its purest form of milk oung mot!er%s segment s!ould 9e addressed for t!e 9etter gro5t! of t!eir c!ildren 9ecause t!e purest form of milk .o" +estle fulfill t!e need of complete !ealt!y and nutritious food for everyone in family out! is to 9e addressed 5it! respect to t!e energy t!ey need to perform t!eir daily tasks
7ge
8ender
.ocial Class
Income ?ange
4D2=
-een 7ges
Middle ; Gpper
+7
+7
2=D$=
M7,E
Gpper Gpper" Gpper Middle" Gpper ,o5er"
.elfDemployed" $="===D2$="=== o9 'olders per mont!
2=D$=
M7,E
Middle Gpper" Middle Middle
o9 'olders" .elfDemployed
1="===D$="=== per mont!
2=D$=
FEM7,E
Gpper Gpper" Gpper Middle" Gpper ,o5er"
'ouse5ives" o9 'olders
$="===D2$="=== per mont!
2=D$=
FEM7,E
Middle Gpper" Middle Middle
'ouse5ives" o9 'olders
1="===D$="=== per mont!
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-e*aviorist Segmentation:
&ividing consumer into groups according to t!eir uses loyalties or 9uying responses to a product is 9e!aviorist segmentation for example product of 9rand usage degree of usage are com9ined 5it! demograp!ics and psyc!ograp!ic criteria to develop profiles of market segments +estle !as an advantage t!at t!ey !ave already got a strong 9rand image People are loyal to t!is 9rand" making use of 5!ic! +estle can specially target t!is segment ; offer t!em any ne5 product or !ig!lig!t any feature into marketing campaign to sell more
'ustomers ro+ile:
Families" c!ildren" Females 'ouse 5ives 9et5een t!e ages of 2$D6$ 5!o are conscious a9out !ealt! of t!eir c!ildren +E.-,E is focusing eo&le as a 5!ole regardless of demograp!ic" psyc!ograp!ics and geograp!ic -!e main target of t!e firm is PE
'urrent (arketing (ix:
roduct:
Nuality product" Product style and logo" Product life cycle rice: Competition 9ased pricing Milkpak is !olding a large s!are in t!e market due to its @uality at same price as compared to competitors lace: Milkpak is not sold directly to consumers and t!e complete distri9ution process is follo5ed It uses indirect c!annels for distri9ution like:
Manufacturer &istri9utor !olesaler ?etailer Consumer
romotion: +estle focuses on !ealt! conscious people in t!eir advertisement (arketing Strategies: Marketing programs of +estle Milkpak ,td are very influential one
!enever ne5 products or ne5 packaging of existing product is launc!edJ it is properly 1
communicated t!roug! an orc!estrated promotional plan like events or sponsors" music programs are sponsored" point of purc!ase and point of sales materials are properly displayed at visi9le places of retail outlets In t!is 5ay" proper a5areness a9out t!e project are created and t!e sales are stipulated .upporting 7ctivities In supporting activities +estle Milkpak ,td is !aving competencies in procurement" tec!nology development" !uman resource management and infrastructure .o far as tec!nological development is concerned" +estle Milkpak ,td !as t!e advantage of tec!nical kno5!o5 got from +estle /7 .5itAerland Management of !uman resources at +estle Milkpak ,td is very good +e5ly recruited employed are trained as per re@uirement Nuality control and information management are contri9uting a lot in making t!e infrastructure of +estle Milkpak ,td very effective and efficient Capacity Increase of Milk Po5der ,ine at Ba9ir5ala Factory Ba9ir5ala Milk Po5der Plant 5!ic! 9egan production in .eptem9er 100" dou9led its capacity in Fe9ruary 1000 7 ne5 +I?< evaporator 5as installed to meet increased processing re@uirements during t!e coming years
'ustomer driven (arketing strategy:
+estl is an organiAation 5orking glo9ally 7s t!e operations of t!e organiAation areextended in almost all countries" it is not dou9tless at all t!e competitive focus must 9e at t!e !eart of t!e company%s international strategy +estl%s competitive strategies are closely affected 5it! foreign direct investment F&I# in milk" dairy" 9everages and ot!er food 9usinesses +estl !as an o9jective to 9alance sales o9tained from lo5 risk and lo5 gro5t!c ountries of t!e developed 5orld 5it! !ig! risk and potentially !ig! gro5t! markets of underdeveloped or developing countries ie 7frica and ,atin 7merica +estl identifies t!e potential profits from t!ese !ig!Drisk countries" 9ut doesn%t take unnecessary risks just for t!e sake of gro5t! -!is strategy and process of circumventing keeps gro5t! steady 5!ile maximiAing s!are!olders value ‟
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BCG Matrix:
Stars:
-!e products 5it! !ig! market s!are and !ig! market gro5t! are categoriAed as star products of t!e company -!is means t!at star products can 9e seen as market leading products -!ese products 5ill need a lot of investment to retain t!eir position" to support furt!er gro5t! as 5ell as to maintain its lead over competing products
'as* 'ows:
-!e products 5it! !ig! market s!are and less market gro5t! are categoriAed in cas! co5s -!is is due to less competitive pressures 5it! a lo5 gro5t! market and t!ey usually enjoy a dominant 1
position t!at !as 9een generated from economies of scale Cas! co5s are still generating a significant level of income 9ut are not costing t!e organiAation muc! to maintain 5uestion marks:
-!ese products prove to 9e tricky ones for product managers -!ese products are in a !ig! gro5t! market 9ut does not seem to !ave a !ig! s!are of t!e market" !ence are la9eled as @uestion marks ,ogs:
Product classified as dogs al5ays !ave a 5eak market s!are in a lo5 gro5t! market -!ese products are very likely making a loss or a very lo5 profit at 9est -!ese products can 9e a 9ig drain on management time and resources (ilk&ak is categoriAed in t!e cas! co5 products of nestle" Milkpak !as 9een successful covering
major portion in t!e market of Pakistan and is a source of generating major capital for t!e company Milkpak enjoys a dominant position in t!e market and !as proven to 9e one of t!e 9est milk in Pakistan
(arket ex&ansion grid:
Existing market
Existing product
+e5 product
(arket &enetration:
roduct develo&ment:
•
+e5 market
Milkpak
(arket develo&ment: •
Mineral 5ater
12
•
+esvita
,iversi+ication:
+estle crunc!
(arket &enetration:
-!e market penetration strategy can 9e used 9y a company to find 5ays to 9etter adapt to t!e current market and increase its sales and profits In t!e market penetration strategy t!e company is increasing its marketing efforts in order to gain a 9igger market s!are for t!eir existing products on t!e current markets Market penetration strategy can 9e applied on (ilk&ak since it covers a !uge market s!are and more opportunities are availa9le to increase t!e market s!are .ome of t!e 5ays to increase market s!are 5ould 9e to try to convince current customers to 9uy more products 9y making t!em 9elieve t!at it is a !ealt!y and a relia9le product Moreover 9y attracting t!e competitor%s customers to 9uy your product" t!is can 9e done 9y advertising t!e idea t!at your product is comparatively 9etter in every manner 5!et!er it is @uality" price or @uantity etc roduct develo&ment:
Product development is used 5!en t!ere is a ne5 product 5!ic! !as to 9e introduced in an existing market +estle +esvita launc!ed recently in t!e past couple of years needs to 9e implied upon t!e product development strategy -!is may 9e done 9ecause t!e company%s products are not selling anymore or t!at t!e company !as identified ne5 segments 5!ic! it !ad missed 9efore and 5ants to introduce ne5 product to increase product sales -!ere are majorly t!ree tactics 5!ic! t!e company can use for Product development 1 -!e company can develop ne5 features for t!e product 2 -!e company can develop different product @uality levels 6 -!e company can improve t!e product%s tec!nology
(arket develo&ment: 1
-!e market development strategy is used 5!en t!e product is an existing product 9ut t!e market is ne5 7 company mig!t decide to increase its territorial reac! and t!erefore enter a ne5 market -!e ne5 market may !ave toug! competitors" or it may !appen t!at t!e ne5 company may 9e received very positively +estle mineral 5ater an existing product re@uires t!e implementation of t!e market development strategy 7 major 5ay to increase market s!are 5ould 9e to create t!e a5areness t!at pure is necessary for a !ealt!y life" convincing people to prefer 9ottled 5ater in comparison to tapped 5ater ,iversi+ication:
&iversification strategy is used 5!en a company enters ne5 markets 5it! ne5 products In suc! a scenario" t!e demands of t!e ne5 market mig!t 9e different from t!e current markets 5!ere t!e company exists -!us" t!e company !as to 9ring ne5 products in ne5 markets and !ence t!e complication rises +estle crunc! is identified as t!e diversification product of t!e company
External and internal +actors a++ecting t*e /rand: External +actors:
.ome of t!e major external factors affecting t!e 9rand are: • • • • •
Political Economical .ocial -ec!nological ,egal factors
olitical +actors:
Political factors or !o5 and to 5!at degree a government intervenes in t!e economy .pecifically" political factors include areas suc! as tax policy" la9or la5" environmental la5" trade restrictions" tariffs" and political sta9ility Political factors may also include goods and services 5!ic! t!e government 5ants to provide or 9e provided merit goods# and t!ose t!at t!e government does not 5ant to 9e provided demerit goods# -!e company policies are affected and
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its 9udget is also affected +estle pays1$O sales tax and 1*Oexcise duty 5!en t!ey import c!illers from ot!er countries
Economical +actors:
Economic factors include economic gro5t!" interest rates" exc!ange rates and t!e inflation rate -!ese factors !ave major impacts on !o5 t!e company operates and makes decisions For example" Interest ?ates 7ffects Company%s cost of capital and t!erefore to 5!at extent a 9usiness gro5s and expands Exc!ange rates affect t!e costs of exporting goods and t!e supply and price of imported goods in an economy 'ence forcing t!e company to increase t!e price of t!e product Social +actors:
.ocial factors include t!e cultural aspects and include !ealt! consciousness" population gro5t! rate" age distri9ution" career attitudes and emp!asis on safety -rends in social factors affect t!e demand for a companys products and !o5 t!at company operates Companies may c!ange various management strategies to adapt to t!ese social trends suc! as recruiting older 5orkers People mostly prefer fres! and open milk and rely less on processing milk 9ecause t!ey t!ink t!at milk companies add c!emical skin milk during process" so suc! factors are to 9e considered important 3ec*nological +actors:
-ec!nological factors include environmental aspects" suc! as ?;& activity" automation" tec!nology incentives and t!e rate of tec!nological c!ange -!ey can determine 9arriers to entry" minimum efficient production level and influence outsourcing decisions Furt!ermore" tec!nological s!ifts can affect costs" @uality" and lead to innovation
egal +actors: 15
,egal factors include discrimination la5" consumer la5" antitrust la5" employment la5" and !ealt! and safety la5 -!ese factors can affect !o5 a company operates" its costs" and t!e demand for its products
Internal +actors:
7n organiAations internal environment is composed of t!e elements 5it!in t!e organiAation" including current employees" management" and especially corporate culture" 5!ic! defines employee 9e!avior employee 9e!avior directly affects t!e 9rands performance (ission statement:
7n organiAations mission statement descri9es 5!at t!e organiAation stands for and 5!y it exists It explains t!e overall purpose of t!e organiAation and includes t!e attri9utes t!at distinguis! it from ot!er organiAations of its type 7 mission statement s!ould 9e more t!an 5ords on a piece of paperJ it s!ould reveal a companys p!ilosop!y" as 5ell as its purpose rgani7ational culture:
-!e organiAational culture is an organiAations personality ust as eac! person !as a distinct personality" so does eac! organiAation -!e culture of an organiAation distinguis!es it from ot!ers and s!apes t!e actions of its mem9ers ormal structure:
-!e formal structure of an organiAation is t!e !ierarc!ical arrangement of tasks and people -!is structure determines !o5 information flo5s 5it!in t!e organiAation" 5!ic! departments are responsi9le for 5!ic! activities" and 5!ere t!e decision6making po5er rests
S93 Analysis: 19
Strengt*s: -rand ame:
Milkpak is a product of nestle Milkpak is a trusted 9rand kno5n t!roug!out t!e country for its nutritious 5!olesome goodness and pure natural taste 5uality:
-!e @uality of Milkpak is superior and t!ey continuously 5ork to maintain t!e @uality -!ey 9elieved t!at @uality and persistent commitment to continuous improvement are essential to our ongoing success ;H3 <;ltra Heated 3reatment=:
-!ey use ultra !eat treatment to kill t!e spores in milkG'- is t!e steriliAation of food 9y !eating it for an extremely s!ort period" around 1D2 seconds at a temperature exceeding 16$ degree C >esearc* and develo&ment de&artment:
?esearc! and development department continuously 5orks on innovation for t!e milking process and for t!e improvement of @uality It is essential to keep coming 5it! 9reakt!roug!s for t!e success of any product or t!e success of any company and mikpk !as al5ays delivered ,istri/ution etwork:
+estle Milkpak !as a very strong distri9ution net5ork 5!ic! covers all over Pakistan ackaging:
Milkpak 5as t!e first tetra pack introduced in Pakistan in 10*1 5it! green and 5!ite packaging -!is green and 5!ite color associated 5it! t!e Pakistan%s flag -rand loyalty:
Milkpak is t!e product of +estleJ +estle enjoys a good and strong reputation all over Pakistan 5!ic! ensures 9rand loyalty from its customers
9eakness: 0
External sources +or raw material:
7s nestle is dependent on external sources for t!e ra5 material" t!ey t!erefore sometimes face some difficulties in executing t!e production process timely ackaging +rom 3etra &ak:
Milkpak depends entirely on -etra pak for t!e packaging of its dairy products" -etra pak 9eing t!e only option for packaging for nestle 9ecause of t!eir monopoly in t!e 9usiness" c!arges more t!an sufficient amount for packaging 5!ic! leads to increase in prices and decrease in advertising 9udget 7s 5e are all a5are t!at it re@uires fre@uent advertising to survive in t!e milk 9usiness 9eak im&lementation o+ 'S>:
-!e company !as announced and is involved in various programs t!at aims to make company more eco friendly and improving t!e 5orking conditions fits suppliers .till +estle receives a lot of criticism over t!e effectiveness of its programs &&ortunities: ,evelo& its own +arms:
Milkpak s!ould develop its o5n farm!ouses to ensure continuous and @ualitative supply rat!er t!an relying on ot!ers Increased 4overnment +unding?su&&ort:
8overnment of Pakistan decided to increase t!e farmers funding -!is is an opportunity for Milkpak 9ecause farmers 5ill 9e a9le produce more @uantitative and @ualitative milk Explore support from t!e government of Pakistan suc! investment opportunities Strong and continuous marketing cam&aign:
+estle needs to initiate t!e programs for strong and continuous marketing campaign as it 5ill only proof to 9e 9eneficial for t!e organiAation in every manner Suita/le environment:
1
Pakistan is t!e sevent! largest milk producing country in t!e 5orld 5it! t!e annual output of over 22 9illion liters -!ere are su9stantial gro5t! opportunities considering t!e average yield of Pakistani animals at only 11== liters>annum as compared to === liters>annum for animals in Europe and G.7 -!ere are nearly 2= million milk producing animals in t!e country 3*reats: 'om&etitors:
-5o main competitors 'alee9 and
Market segment gro5t! could attract ne5 entrants olitical and economical issues:
Economic slo5do5n can reduce t!e demand and politically Pakistan is not a sta9le country >eligious extremists:
&ue t!e foreign origin of t!e company some extremists avoid t!e use of nestle and recommend it to ot!ers not to use Milkpak or any ot!er 9rand of nestle >ising raw +ood &rices:
it! an overall gro5t! of 5orlds economy and population" demand for ra5 food increases resulting in !ig!er material costs and s@ueeAed margin for nestle In+lation:
Inflation is getting !ig!er and !ig!er day 9y day 5!ic! is decreasing t!e purc!asing po5er of people roduct classi+ication:
Milkpak is categoriAed in t!e convenience goods as it is included in t!e necessities of life 7 convenience product is a consumer product t!at takes little t!oug!t" is routine" purc!ased
often" appeals to a large target market and t!e consumer purc!ases 5it! little planning -!ese are t!e products t!at appeal to a very large market segment -!ey are generally consumed regularly and purc!ased fre@uently )ecause of t!e !ig! purc!ase volume" pricing per item tends to 9e relatively lo5 and consumers often see little value in s!opping around since additional effort yields minimal saving roduct ine:
7 product line is a num9er of products grouped toget!er 9ased on similar c!aracteristics -!e c!aracteristic used to split products" 5ill depend on t!e firm and its product strategy Milkpak is t!e only li@uid milk sold 9y nestle in Pakistan" 5!ereas a couple of ot!er products are sold ie +ido and Everyday 9ot! are po5dered milk -!ese products are not a9solutely of t!e same nature 9ut more or less carry t!e same c!aracteristics roduct li+e cycle:
Eventually every product goes t!roug! all t!e stages of product lifecycle +estle Milkpak after t!e stages of introduction and gro5t! is no5 enjoying a sta9le maturity stage -!e product covers a 5ide range of market and is a kno5n product t!roug!out t!e country Maturity stage is a time period 5!en t!e product sales are at its peak &uring t!e maturity stage" t!e product is esta9lis!ed and t!e aim for t!e manufacturer is no5 to maintain t!e market s!are t!ey !ave 9uilt up -!is is pro9a9ly t!e most competitive time for most products and 9usinesses need to invest 5isely in any marketing t!ey undertake -!ey also need to consider any product 3
modifications or improvements to t!e production process 5!ic! mig!t give t!em a competitive advantage ricing strategy:
Price is t!e value t!at is put to a product or service and is t!e result of a complex set of calculations" researc! and understanding and risk taking a9ility 7 pricing strategy takes into account segments" a9ility to pay" market conditions" competitor actions" trade margins and input costs" amongst ot!ers It is targeted at t!e defined customers and against competitors -!ere are several pricing strategiesJ follo5ing are t!e four 9asic strategies variations of 5!ic! are used in 9usiness: 1 2 6 4
Premium pricing Penetration pricing Economy pricing .kimming strategy
-!e pricing strategy 5!ic! 5as implemented for Milkpak at t!e time of launc! 5as t!e penetration strategy enetration strategy:
Price is set artificially lo5 to gain market s!are @uickly -!is is done 5!en a ne5 product is 9eing launc!ed It is understood t!at prices 5ill 9e raised once t!e promotion period is over and market s!are o9jectives are ac!ieved -rand &ositioning@ ersonality and -rand strategy: -rand &ositioning:
Put simply" 9rand positioning is t!e process of positioning your 9rand in t!e mind of your customers )rand positioning is also referred to as a positioning strategy" 9rand strategy" or a
9rand positioning statement
In 9ot! of t!ese advertisements" t!e advertiser is trying to project t!e fact t!at t!e product is a9solutely safe and !ealt!y" moreover t!e company is implying t!e fact t!at t!e product is an a9solute necessity 5!ic! completes and makes t!e family stronger Projecting into t!e minds of customers t!at it is a safe product and is to 9e used 9y t!e 5!ole family It 9asically is 5!at kind of perception you create of your product in t!e minds of t!e customers Milkpak !as no5 positioned itself as a part of t!eir daily life
-rand &ersonality: 2
7 set of !uman c!aracteristics t!at are attri9uted to a 9rand name 7 9rand personality is somet!ing to 5!ic! t!e consumer can relate" and an effective 9rand 5ill increase its 9rand e@uity 9y !aving a consistent set of traits -!is is t!e addedDvalue t!at a 9rand gains" aside from its functional 9enefits -!ere are five main types of 9rand personalities: excitement" sincerity" ruggedness" competence and sop!istication Milkpak is !aving good market s!are and gro5ing so fast +ation5ide" as per our internal researc! suggests Currently Milkpak is !aving )rand Personality is contri9ution of ,ove" Care" Family and po5er as our previous advertisements !ave made in consumers mind t!at every ad s!o5s family" love" care and everyone likes to !ave Milkpak as a Milk" I?<+ as feature of Milkpak !elps individual to fulfill routine tasks 5it! !elp your I?<+ P<E? 5!ic! gives 2=O I?<+ re@uirements e !ere are trying to 9uild a )rand Personality ie milk for everyone
-rand strategy +or (ilk&ak:
our 9rand is more t!an your logo" name or slogan it%s t!e entire experience your prospects and customers !ave 5it! your company" product or service our 9rand strategy defines 5!at you stand for" a promise you make" and t!e personality you convey 7nd 5!ile it includes your logo" color palette and slogan" t!ose are only creative elements t!at convey your 9rand Instead" your 9rand lives in every dayDtoDday interaction you !ave 5it! your market: •
-!e images you convey
•
-!e messages you deliver on your 5e9site" proposals and campaigns
•
-!e 5ay your employees interact 5it! customers
•
7 customer%s opinion of you versus your competition
'*annel o+ distri/ution (ilk&ak@ estle: +estle uses indirect distri9ution met!od for t!e distri9ution of Milkpak all over Pakistan " t!e !ierarc!y of distri9ution is as follo5s
(anu+acturer
,istri/utor
>etailer
'onsumer
-!e distri9ution strategy pursued 9y t!e +estle Milkpak is intensive. It means t!at t!e product distri9ution is covering 5ide market -!ere are regional !ead@uarters of t!e company in all t!e 9ig cities of t!e country -!ere is a distri9utor in eac! 9ig city In order to reac! remote areas" a distri9utor engages a su9Ddistri9utor for a small area -!e company is directly linked 5it! t!e main distri9utor and t!e su9Ddistri9utor !as no suc! direct contact 5it! t!e company -!e company provides t!e Milkpak inventory to t!e main distri9utor t!at is furt!er dispatc!ed to retailers and su9Ddistri9utors -!ere is a regional manager of +estle t!at employs 7rea .ales Manager for a specific area -!en comes t!e -erritory .ales
Islama9ad and +ort! outstations 4
•
e!lum
•
Pes!a5ar
'entral one: •
,a!ore
•
Faisala9ad
•
8ujran5ala
•
Multan
•
.a!i5al
Sout* 7one: •
Barac!i
•
'ydera9ad
•
Nuetta
•
.ukkur
Some o+ t*e ,istri/utors in a*ore: Saeed -rot*ers:
Model to5n -o5ns!ip
5
akir and Sons:
7irport
8!aAi road
,ean distri/utors: (uslim town
S(> ,istri/utors:
Fata! 8ar!
'om&etitive advantage o+ (ilk&ak: •
+estle Milkpak never compromises on @uality
9
•
+estle Milkpak"s extensive milk collection system ensures t!at t!e milk you get is of t!e finest @uality
•
+estl%s products are availa9le in every city and to5n
•
+estle is using t!e latest tec!nology in its production units
•
+estle makes milk po5der of t!e surplus milk in 5inter and converts t!is milk po5der into G'- milk in summer
•
<9serving t!e market situation nestle often offers seasonal discounts on Milkpak to gain competitive advantage
•
!en on promotion +estle offers additional free products 5it! Milkpak for instance small pack of po5dered milk free 5it! 1 liter pack of Milkpak
•
Milkpak !as arranged various sc!emes offering gifts to people in return for empty 5rappers of Milkpak" gifts suc! as cars 5ere distri9uted t!roug! lottery
30
'om&etitorBs analysis o+ (ilk&ak: .ome of t!e major competitors of Milkpak are as follo5s: •
•
'alee9
•
8oodmilk and ot!ers
l&ers:
Engro Foods !ad only recently 9een esta9lis!ed 9y Engro a traditional giant in Pakistan%s c!emical and fertiliAer industry Engro Foods launc!ed
In10* t!e commercial production process started 5it! G'- li@uid milk from May 21" 10* -!e li@uid milk 5as t!e first product launc!ed in t!e market -!e company started its operations in 10*$ !aving t!e state of t!e art plant in t!e entire dairy sector of Pakistan Comprising an area of 62 7cres" t!is plant !ad a capacity of producing *="=== liters per day of milk rice analysis wit* com&etitors:
31
roducts:
rice o+ 1 liter &ack
rice o+ %"0 ml. &ack
(ilk&ak
>s. 110
>s.#0
l&ers
>s. 110
>s.#0
Halee/
>s. $"
?A
4oodmilk
>s. 88
>s. %!
Market Share as of 20
7estle 08 l(ers3$2 8 :oodmilk,;alee& and others 4$28
3ools o+ &romotion mix ? I(' used /y com&any +or selected /rand:
3
Promotion activities play an important role in re launc!ing any product Increase in target market is possi9le 9y personal selling It includes persons in retail stores telling t!e 9enefits to potential customers a9out importance of milk in standard packed form 75areness plays t!e most important role -!ey s!ould taste !ouse 5ives on different places )ecause t!ey are t!e main servers of suc! kind of nutritional diets to t!eir family mem9ers -/ commercials and )ill )oards s!ould 9e planned to 9e advertised properly ,etermining t*e &romotional met*ods:
-!ere are various promotional met!ods like personal selling" advertising" sales promtions" pu9lic relations etc 9ut +estl attracted t!e existing customer of t!e imported 9rands and potential customers t!roug! its advertising campaign In t!eir campaign" +estl mostly focus t!e small c!ildren 5!o are t!e major portion of our society and milk and suc! kinds of Products are 9asic re@uirement of grooming c!ildren t!at t!e reason +estle launc!ed +esvita Milk especially designed for gro5ing c!ildren 9ecause introduction of calcium diets in daily diet c!art is 9asic re@uirement
-roadcast media:
3EE)ISI:
+estle use 4=O of t!eir 9udget on t!e 9roadcast media -elevision is t!e major medium used for t!e advertisement +estle !as 9een playing commercials on t!e -/ since t!ey !ave launc!ed t!e +estle Milkpak -!eir 7ds cover all t!e lifestyles of t!e people In t!eir ads t!ey !ave s!o5n many situations •
Friends sitting toget!er
•
C!ild playing
•
.5immer Families in good mode
•
ounger generation in smiling energy form
•
Family enjoying picnic etc 33
In t!e entire a9ove situations t!ey !ave s!o5ed t!e importance of t!e pure milk" 5!en it%s a9out at!lete" !e is !ealt! conscious" 5!en friends sitting toget!er and !aving fun 5!at t!ey need -!e main t!ing t!e +estle 5anted t!at people s!ould trust on t!at +estle is purest form of milk >A,I:
+estle is not only advertising on -elevision 9ut t!ey are also advertising on radio -!ey play t!e vocal ads on Fm 1== and 1=1 7dvertising on radio is 9asically for t!e people 5!o are on roads >I3 (E,IA:
In t!e print media +estle is using t!e follo5ing mediums to advertise (aga7ines C ews&a&ers:
+estle advertise in 9ot! magaAine and ne5spaper on 5eekly and mont!ly 9asis Follo5ing is t!e list of magaAine and ne5spaper in 5!ic! nestle advertise: •
-!e +e5s
•
+ation
•
&a5n
•
.unday MagaAine
•
-!e Economist M78" Etc
-E9 3HE IE
)elo5 t!e line includes follo5ing mediums of advertisement: •
&irect mail
•
•
-ransit
•
.upplementary material
,I>E'3 (AI A,)E>3ISI4
It is any form of advertising issued directly to t!e prospect" 5!et!er t!roug! t!e mail" fax" online computer services" salesperson" dealers or ot!er means rat!er t!an t!roug! traditional mass media 3
ostcards
+estle sends postcards to t!eir !ome and office persons in t!e category of retailers and 5!ole sellers
ea+lets? +lyers:
+estle !as placed many types of leaflets" 5!ic! contain information a9out +estle Milk pack" at different outlets olders ? /roc*ures:
+estle send 9roc!ures of t!eir product to t!eir customers t!roug! mail to make t!em a5are of ne5 innovations and products -!is !elps nestle in getting more customers ;3,>:
+estle spend a 9ig s!are of t!eir advertisement 9udget on t!e outdoor 7dvertisement" 5!ic! includes: •
Painted )ill9oards
•
MM-
•
/inyl s!eet
•
?otary Plan
'ere is an example of t!eir 9ill9oards and rotary plan: +estle !as placed more t!an 1== 9ill9oards across t!e roads -!ey !ave put on different skins of t!em" 5!ic! are s!o5ing different situations in 5!ic! people are using pure 5ater 7ccording to t!e +estle t!ey use !eavy outdoor advertisement to remind people a9out t!e availa9ility of t!eir product 9ecause it is a product for 5!ic! people never pre plan to purc!ase it so to motivate t!em for t!e purc!ase of +estle Milk Pack t!ey !ave to place 9ill9oards )eside t!is t!ey rotate t!e skins of t!eir 9ill9oards after fe5 mont!s t!e reason for t!is is t!at people lose interest in t!ose skins 5!en
32
t!ey see it for a long time so 5!en t!ey rotate t!em and place t!e ne5 one t!at create t!e interest among t!e people
3>ASI3 A,)E>3ISI4
-ransit advertising is a category of out of !ome media t!at includes 9us and taxica9 advertising as 5ell as posters on transit s!elters" terminals" and airports -ypes of transit advertising: •
Inside cards
•
•
-erminal posters
•
-axi > 9us exteriors
•
-erminal posters
+estle !as placed many attractive and attention getting posters on t!e terminals and .tations in different cities Scroll 9orks
+estle is also advertising on scroll 5orks" as 5e kno5 scroll 5orks advertise t!roug! mini vans in t!e city -!ese van moves t!roug!out t!e city 5!en people see t!e scroll 5ork t!ose ads remind t!em of +estle Milk Pack during delivery to5ards t!e retail outlets and 5!ole sellers Skins on -uses
+estle !as pasted t!eir skins on &ae5oo city 9uses" in t!is category t!ey are advertising on certain 9uses 'urrent advertising cam&aign:
+E.-,Q Pakistan and -etra Pak Pakistan !as proudly coDlaunc!ed t!e Pakistan .afe Milk Movement today -!e aim of t!e movement is to educate every Pakistani on t!e importance of consuming milk t!at is safe In addition" t!e movement also intends to give enoug! a5areness to everyone to 9e a9le to understand !o5 milk could 9e unsafe and t!e su9se@uent adverse effects on !ealt! o5ing to t!e consumption of unsafe milk
3
-!e ceremony 5as !osted 9y .idra I@9al" leading media anc!orperson and development activist 7mong ot!er nota9les from 9ot! +E.-,Q Pakistan and -etra Pak Pakistan" t!e launc! event 5as attended 9y reno5ned p!ilant!ropist .yed )a9ar 7li and also 9y distinguis!ed 5riter and respected media personality 7n5ar Ma@sood" t!e 9rand am9assador for +E.-,Q MI,BP7B" 5!o is also spear!eading t!e movement
34
'onclusion: .umming it all up I 5ould say t!at Milkpak introduced packed milk in Pakistan for t!e first time +estle created and !as revolutioniAed t!e milk industry since its existence Milkpak !as 9een a leader in t!e respective fields since its existence 9ut no5adays competitions are toug! some strong competitors !ave entered t!e market and are consuming t!e markets s!are of +estle" 9ut +estle still is on top of t!e mountain striving !ard to maintain its superiority )ut still nestle needs to keep up t!e good 5ork and strive as !ard as t!ey can to keep up t!eir position in t!e market +estle Milkpak !ave a great s!are in t!e different multinational companies It isstatistically calculated t!at +estle Milkpak !ave $=O s!are in t!e +estle company and no5 +estle 9ecome t!e leader of all multinational companies in food products and 9everages +estle is operating in all 9ig cities in Pakistan and try 9est to provide its Products to ot!er small cities and to5ns
35
A&&endix:
39
