Final Report of Nido (1)

D E D I C A T I O N “ T HI HI S

R EP EP OR OR T I S D ED ED IC IC AT AT ED ED STUDENTS”

TO

AL L

B US US I NE NE SS SS

We like to dedicate this report to all business students w h o w a nt nt t o b e co c o me m e g r ea ea t b u si s i n es es s p ro r o f es e s s i on on a ls ls a nd nd want to be on the height of the “business World “. We hope that they would be satisfied from our task and that would help them in their future life. We at this point shall not forget the fruitful efforts of our teacher Prof. Hashim sultan without whom we would have been unable to accomplish this.

Fundamentals of Marketing

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AC A C K N O W L E D G E M E N T

A llll p rra a is i s e t o Allah , t h e e n ti ti r e w i sd s d om o m a n d k n ow ow l ed e d ge ge , w ho h o h as a s g iv i v en e n u s t he h e o pp p p or or ttu u ni n i ty t y t o t hi h i nk n k , j ud u d ge g e a nd nd complete our term project of Fundamentals of Marketing. W e a r e a l so s o t h an an k fu fu l t o o ur ur r e s sp p e ct ct a bl bl e t e ac ac h er e r Prof. Hashim Hashim sultan sultan w ho ho h a s g iv iv en en u s t he h e o pp pp or or tu tu ni ni ty ty t o understand the marketing concepts in actual practice and h e i s t he he o nl nl y s ou ou r ce ce w h o d ir ir ec ec te te d u s t o a pp pp ly ly o ur ur abilities in the required direction. We are also very thankful thankful to Mr. Usman , Brand Manager of NIDO in Nestle, who has provided us all the related information and guidance regarding our project.


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Marketing Marketing Term Report NIDO By NESTLE MISSION STATEMENT: “We are committed to offering consumers high-quality food products that are safe, tasty and affordable.”

VISION STATEMENT: “We care care for for our our consu consume mers rs becau because se our our succes success s depen depends ds on meeti meeting ng their their need needs s and and expect expectati ation ons. s. Thro Throug ugh h listen listening ing and and understanding, we can make products that they will want to use all through their lives.”

INTRODUCTION TO NESTLE COMPANY Nestle International: Nestle is the name which is very respectable among international and multinational firm. NESTLE was born in the green plains and blue streams of SWITZERLAND and has its head office in VEVY. SWITZERLAND and its first product was Chocolate. The company has has a 126 126 year years s old old hist histor ory y and and had had domi domina nate ted d in almo almost st all all segm segmen ents ts of mark market et incl includ uded ed food food,, nutr nutrit itio ion’ n’s, s, milk milk,, swee sweets ts,, chocolates, cosmetics and many other products. In simple words they have a product for every one. Nest Nestle le duri during ng its its old hist histor ory y esta establ blis ishe hed d it self self as a qual qualit ity y conscious company and become the leading business company in the world..

Branches:


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It has has its its fact factor orie ies s in more more than than 70 coun countr trie ies s and and mark market et .Its .Its product in more than 125 countries and the sales of the Nestle is among the top ten companies of the world.

Nestle In Pakistan: Nestle international also wanted to expand its business in South East Asia. For this motive in mind the first signed a venture with Indian Company and than turned its attention towards Pakistan.

Venture With Milkpak: Milk Milkpa pak k is a comp compan any y of Wa Wazi zirr Ali Ali Gr Grou oup p and and is know known n for for producing finest quality products like Milkpak Dairy products e.g. Milkpak Milk, Butter, Desi ghee, Cream etc. and also a market share leader in juices e.g. Frost. Seein Seeing g the the repu reputat tatio ion n of Milkp Milkpak ak in Pakis Pakistan tan,, Nestle Nestle signed signed a venture in 1987 and from than the company is serving consumers with the name NIDO.

PRODUCT NIDO Our product is Nido 1+, 3+, 6+. Now, there is brief introduction of our product Nido. Nido is a product of Nestle. Basically, it is milk in the form of powder. Company takes the pure milk from the cows and dried it in the form of powder and some nutrients, which are beneficial beneficial so that consumer will get it in the form of pure form milk and children will Becom Become e heal healthy thy.. NIDO NIDO is avail availab able le in the marke markett in the three three diffe differen rentt types types for the differ different ent age age childr children en that that are explai explain n below:

NIDO 1+: Age: Nido 1+ is for 1 to 3 years children. Main Features: It’s It’s specia speciall featu feature re is Prebio’ Protect Protection ion which which means means healthy healthy Tummy. Nido 1+ comes with Prebio Nestle unique natural natural blend of fibers, helps to maintain a healthy digestive system of children from age 1 to 3 years. Nido 1+ also contains Vitamins A, C, E, Selenium Selenium,, Zinc and and from from that that your yours s chil child d immu immuni nity ty to figh fightt against germs and battery and helping the child to grow strong and healthy.


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NIDO 3+: Nido 3+ is for 3-6 years children. Main Features: Nido3+ means Smart Growth. At the age of 3, your child begins exploring the exciting world of school and friends, eager to group new ideas. Encourage your child to be active learner and sociable. Its main feature is o increase the mental abilities of your child.

NIDO 6+: Age: Nido 6+ is from the 6-onwards children. Main Features: Its main feature is Calci-N means Healthy Bones. From age 6 it is important that children get enough calcium to make their bones strong since most of their bone structure is built before reaching 30 years of age. Nido 6+ contains Calci-N Nestle natural calcium source from milk, which has calcium and vitamin –D in proportion that helps lock in your child’s bones. With only two glasses of Nido 6+ daily your child will get all the calcium needed everyday to build bones.


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PRODUCT EVALUATION Type of Product: As NIDO has physical existence, so it comes under the head of tangible goods.

Level Of Product: Nestle planned this product on three levels before launching launching in the market. These three levels are Core Benefit, Actual Product and Augmented Product. Benefit stage In Core Benefit stage,, Nestl Nestle e has has scrut scrutini inized zed the the basic basic need need st intr intro oduci ducing ng in the the 21 Centu Century ry regar regardin ding g healt health. h. Nowa Nowaday days, s, everyone is very conscious about his health. So, Nestle determined to introduce the new product “milk” in the form of powder milk, which will fulfill the need of thirst and hunger and provide healthier dirt to the children.

In the second stage, Actual Product, Nestle decided the brand name. The brand name of the product is Nido. It itself does not mean anything. The product has also its own grand mark. Its brand name name and and bran brand d mark mark are are lega legall lly y prot protec ecte ted. d. The The prod produc uctt is marketing under the manufacture brand name. The brand name Nido Nido is easy easy to spell, spell, pron pronou ounc nce e and and remem remember ber and thus thus has has positive positive effect upon upon the marketing marketing of the product. product. Then decide decide quality level which is high in the case of NIDO. Fundamentals of Marketing

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Then decide decide highly highly attractive packaging packaging which which is according according to law. law. In the third stage, Augmented Product, Nestle has given the customers (parents) the solution of the health issue regarding their chil childr dren en.. Now, Now, pare parent nts s can can give give thei theirr chil childr dren en heal health thie ierr diet diet without any ambiguity. Nestle has also told the parents other tips as to how to keep their children healthy and active in different campaigns and Nestle has also provided a toll free number to call if anyone has a problem or questions.

Consumer Products: NIDO is a consumer good targeted to end consumers for ultimate consumption Among different types of consumer products, NIDO Convenience ce product product because NIDO NIDO is freque frequentl ntly y lie lie under under Convenien purchased with minimum comparison and buying efforts. Price is low and NIDO is widely distributed all over the country .

Product Life Cycle There are four stages in the life of a product depends on the time span, the product & the growth level of the product that in which states it lies. 1. Introduction 2. Growth 3. Maturity 4. Decline In case of NIDO, we can say that the NESTLE NIDO lies in its GROWTH stage for the following reasons. • Huge shares in market. • Maximum profit • It lies in star category in BCG matrix • Due to changing in culture of Pakistan people switching to DRY MILK from FRESH MILK (OPEN). This will increase in the sale of NIDO. The diagram diagram is shown below: below: <

Introduction Decline


Growth

Maturity

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MARKETING ENVIRONMENT MICRO ENVIORNMENT: “The factors close to the company that affects its ability to serve its customer”

Accor Accordi ding ng to Ma Mark rketi eting ng Mana Manage ger, r, they they are tryin trying g their their best best to control all the forces that can effect our company such as :

Company: The Company’s Company’s internal and management management operations operations can effect the overall production of Nido. In our company, all the departments have an intranet system so that they can communicate with each other and have latest information about each other. In the same way, all the departments help each other to perform different tasks easier. For example, in Nestle, our Marketing department works with Fin Financ ance depa epartmen tmentt, R & D departm artme ent, Purchas chasiing department etc all work together and focus on the needs of the Customers in order to perform well and meet out objectives and give our customers satisfaction. In the same way, Nestle also rely on team based work, free environment between the sub-ordinates and and bosse bosses, s, decen decentra traliz lized ed auth author ority ity to the manage managers rs and and get get feedback also from the employees in decision making.

Suppliers: As Nestle has an high standard for their milk, and other basic needs which are needed to produce dried milk “NIDO”. So, Nestle feels that most of the suppliers cannot able to fulfill their need according to their standard, at last Nestle has arranged their own system of suppliers and now they have their own farms, cows and from their farms, Nestle has own system to bring Raw Material “Milk” to the Plant. So, in this way, Nestle has controlled impact of external suppliers by arranging their own internal system.


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Intermediaries: They are also using marketing intermediaries intermediaries by owning their own distributors, providing their goods to final buyers and consumers. They are selling Nido through wholesalers, retailers and marketing agencies.

Customers: Custo Customer mers s are are very very impor importan tantt for every every compa company ny becau because se by attracting those customers, company brand will only succeed. So, in case of Nido, Nestle main customers are:  Consumers,  Wholesalers,  Retailers and  International customers.

Public: Publics are the people that are associated with the company due to some some bene benefi fitt or comp compan any y is asso associ ciat ated ed to them them for for thei theirr benefit.. The benefit can be monetary or social. Company give the bene benefi fits ts to its its shar shareh ehol olde ders rs if the the comp compan any y flou flouri rish shes es,, the the shareholders shareholders are the financial public who attain benefit in the form of dividen dividends. ds. In the same way, way, TV channels channels and print print media media are media public because they help the Nestle in their advertisement.. General people people are also the general public of the company such as custo customer mers s and custom customers ers are are those those who who buy buy compa company ny brand brand.. Compensation is also given to the employees, so these are the internal public.


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MACRO ENVIRONMENT: Macro forces are the force that can have impact on the performance of the company. Some of these forces are discuss below:

Demographic Environment: Demographic environment is the geographical study of humans. According to manager, Nido 1+ is for the children of 1 to 3 years, Nido 3+ is for the children of 3 to 6 years and Nido 6+ is for the 6 to onwa onward rds s chil child dren. ren. So, So, incr increa easi sing ng or decr decrea easi sing ng chil childr dren en population, giving children fresh milk instead of dried milk etc can affect the brand.

Technological Environment: Nido plant has latest technology to create more attraction towards their products. However, technology technology is increasing day by day, they have to improve their technology with time.

Economic Environment: Economic environment is the combination of people’s income & spending patterns. As far the economic environment’s concerned is not good

Political Environment Political factors have a great impact on Nido because if the sales incre increase ases s more more tax would would be appli applied ed on the the whol whole e compan company. y. Similarly, if the charges of tax will change, then it will also effect on the brand and it is also a political factor.

Natural Environment: Natural environment can also effect Nido quality or taste. Because if the cows from which milk is obtained, become ill and a disease will spread among them such as then it ha a great impact on Nido.


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Responding to the Marketing Environment There are three kinds kinds of companies: companies: 1. Those Those who who make make thing things s happen happen 2. Those Those who watch watch things things happ happen, en, and and 3. Those Those who wond wonder er what’s what’s happen happened. ed. Nestle is one of those things who make things happen. That is why, Nestle is one of the leading company and most of the companies follow its criteria and trend.

COMPETITORS ANALYSIS NALYSIS Competition: NIDO NESTLE follows Differentiation method for the competition in the the mark market et,, by prov provid idin ing g some somewh what at diff differ eren entt feat featur ures es of the the product. A comp compan any’ y’s s comp compet etit itor or’s ’s envi enviro ronm nmen entt obvi obviou ousl sly y is a majo majorr influenc influence e on its marketi marketing ng system. system. Skillful Skillful executiv executives es constant constantly ly gathe ther intel tellig ligenc ence and other therw wise monitor tor all aspec spectts of competitors marketing activities, their product pricing distribution system and promotional programs. A firm general competition from their different sources: 1. Brand competition from marketers of directly similar products. 2. Subst Substitu itute te prod produc ucts ts that that satisf satisfy y the same same needs needs e.g. e.g. other other powder milk, fresh milk etc. 3. In the third type of competition more general in nature every company is a rival for the customers’ limited buying power. NIDO is concentrating more on the first two types of competition then the third one. NIDO NIDO bein being g the the full full crea cream m powd powder ered ed milk milk,, faci facing ng an inte intens nse e competition in foreign market and somewhat in local market.

Local Market Competitors:


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NID NIDO has has no loca locall mar marke kett comp compet etit itor ors, s, as ther there e is no goo good powd powder ered ed milk milk loca locall lly y prod produc uced ed avai availa labl ble e in the the mark market et and and NESTLE NIDO is the only firm producing good quality powdered milk. Secondly NESTLE is the only firm producing powdered milk and is market share leader in all respects.

International Competitors: At the time when NESTLE introduced NIDO in the Pakistan market it was facing a intense competition with the following brands: MILLAC ♦ RED COW ♦ SAFETY ♦ DANO ♦ KLIM Major competitors among these were Millac and Dano at that time but but span span of time time NIDO NIDO with with its its qual qualit ity y over overco come mes s them them and and become a market share leader. ♦

SWOT ANALYSIS Strengths: The company has more advantage advantage in the Pakistan market because they are market leaders having 95% market shares in Pakistan. Nestle is only one company producing dry milk which is its strength .Now this NIDO has the monopoly in the Pakistan. Nido plan plantt has has the the late latest st tech techno nolo logy gy then then any any othe otherr comp compan any y in Pakistan.

Weakness: Distribution channel is the weakness of the company because it’s only focus in the urban areas. Nido can be affordable in urban areas and Company cannot focus on villages, towns etc.

Opportunities: The company company has the lot of opportunity opportunity to expand their their business in the Pakistani market because there are no other competitors in the Paki Pakista stani ni mark market. et. The The comp company any also got got the 90% share share in the Pakistan market.


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Threat: If any any other other Pakis Pakistan tanii or Intern Internati ation onal al compet competito itorr comes comes in the future that can be the first threat for Nido.

Competitive Advantages:       

    

Nido has best Quality among the Competitors. Excellent taste of Nido Providing the superior value Nido is unique in Pakistan Nido Contains Iron, Proteins, Calcium, Vitamins for the health of children. Nido is most pure milk available in the market in the market. Fully automated machinery and laboratory system are fitted in the Plant to check and maintain the purity, quality and taste of Nido. Powder milk with some thickness Tastes better than than milk Customer loyalty is high and more people trust on brand name. Nido Nido has has stron strong g mark market et and and fina financ ncia iall posi positi tion on than than its its competitors. Nido Nido is avail availabl able e in diffe differe rent nt sizes sizes for the benefit benefits s of its customers.

CONSUMER ANALYSIS Consumers are the most important body in the market, as all the products manufactured in the market are with the analysis of the consumer’s need & wants. Thus, the behavior of the consumer is most important in the success of the company.

CONSUMERS BUYING BEHAVIOR: In order to understand the consumer behaviour, first of all we will discuss the following things explained below:


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Basic Stimuli For the Consumer The stimuli are the factors, which become the main source for buying the product. The company to create the response for the prod product uct creat creates es these these stimu stimuli. li. The The basic basic stimu stimuli li for which which the the company in the case of NIDO is catering are. 

Product

The company is providing providing more features to the product product for the customers. For the better response, the company is having a ‘More for less’ type of theory.



Economic Condition

The economic economic conditions conditions of our country are not so good. The peop people le in Pakis Pakistan tan respo respond nd to the less less price priced d good goods. s. Thus, Thus, the the economic conditions of the country are not stimuli for NIDO. 

Consumer Equity

NIDO NIDO has a stro strong ng cust custom omer er’s ’s equi equity ty.. Mo Most st peo people ple use it frequ frequent ently. ly. The The demand demand of NIDO NIDO is very very stron strong g in mark market et & it captures more than 90% shares of coffee market. 

Brand Recognition

The brand recognition recognition of NIDO is very strong. NIDO has strong brand equity. NIDO is becoming famous in Pakistan day by day. Now, Now, paren parents, ts, which which are are health health consci consciou ous s abou aboutt the the child children ren,, started giving their children NIDO.

BCG HIGH

MATRIX

(MARKET SHARE)

LOW

HIGH

DOGS STARS


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(GROWTH RATE)

QUESTION CASH COWS

MARKS “?”

LOW

NIDO lies under the STARS due to the following reasons. market share of NIDO NIDO is almost about about 90%.  The market growth rate of NIDO is is very high and and bright bright in Pakistan.  The growth

Characteristics affecting consumer behavior:: There are certain factors which can affect the consumer behavior. Some of them are given below:

Factors Influencing Consumer Buying Behavior: 1. Cultural Cultural Factors: Factors: The major cultural factors influencing influencing the buying behavior of customers of NIDO are:  Culture: Parents having health conscious of their children are heading towards requiring greater intake of NIDO by their children, which in turn increase the demand of the product. 

Social Class: Need for the product exists among upper and middle class educated individuals who have greater exposure exposure and awarene awareness, ss, and are readily readily adopti adopting ng the product to take care of their children’s health.

2. Social Factors: Factors: The major social factor influencing influencing the target customer buying behavior is: celebrities and models  Reference groups: These include celebrities in advertisements that greatly influence the decisions of the buyers, primarily mothers (decider), of NIDO.


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

Family: Family, most influential influential primary reference group, is of para paramo moun untt impo import rtan ance ce in NIDO NIDO cons consum umpt ptio ion n by Family of orient orientati ation on) have childr children en.. Paren Parents ts (Family have a majo majorr influence on the consumption pattern of NIDO by children. Both of parents have an equal role in the purchase of NIDO.

3. Personal Personal Factor Factors: s: The major personal influencing influencing the buying behavior behavior of target customers is their family life cycle. 

Family Life Cycle: Consumption of NIDO varies as children mature over their lifetime. For example, mothers use NIDO 1+ for their children aging 1 year to 3 years, NIDO 3 + for their children 3 to 6 years and NIDO 6 for their children above 6 years. In addition, Housewives, if not for small children, also use as Nido as milk and in making many desserts e.g. Kheer, Rasmalai, Custard etc.



Economic Situation : The economic conditions of our country are not so good. The people in Pakistan respond to the less priced goods. Thus, the economic conditions of the country coun try are not stimuli for NIDO.

A person’s economic economic situation affects the product choice. NIDO Marketers Marketers watch trends trends in persona personall income, income, savings savings and interest rates. If economic indicators point to recession, marketers can take steps to redesign, reposition and reprise their products closely

4. Psychologic Psychological al Factors: Factors: 

Motivation: Nestle stle has promote NIDO IDO by moving ing campaigns regarding health of children. It has told that NIDO is better then the fresh milk for the health of their children through campaigns. One of the examples of this campaign is NIDO Sehat Kahani in ARY Digital Channel. So, Nestle is trying to develop the need in the people that NIDO is best for their children.



Perception: Pare arents usual suallly get the infor formatio ation n regarding NIDO through advertisements on TV, radio etc. So, So, Paren Parents ts get get infor informat matio ion n regar regardi ding ng NIDO NIDO and form form perception through Selective Attention.



Learning: Most of parents are learning good experience by giving NIDO to their children.


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

Belief Beliefs s And Attit Attitude ude:: It is diff diffic icul ultt to chan change ge the the customer’ customer’s s attitude attitude,, so, Nesltle is trying trying to change change the public beliefs regarding using fresh milk and making them aware about advantages of powder milk.

Buying Roles Five keys roles affecting buying decision are:  Initiator: Primary Group and Company itself  Influencer: Mainly parents  Decider: Mainly Mothers  Buyer: Both/either Fathers/Mothers  User: Children/Family Consumer Buying Behaviour: The consumer’s behavior behavior for NIDO is ‘Variety-Seeking’ as for the following reasons. • The consumer consumer has a low involveme involvement nt in the product. product. • Significant perceived brand differences. • The product product is a Convenience Convenience good. good. • Marketing strategy is differing from others. • Its a FMCG product • Customer can easily switch in the case of other competitor.

MARKETING STRATEGIES MARKET SEGMENTATION In order to identify the correct target market, NIDO Nestle use the market

Geographic Segments ountry:

Nestle NIDO is focusing on Pakistan. Country Region : Punjab, Sindh, N.W.F.P. and Boluchistan. City:


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NIDO is mainly targeting to metropolitan cities such as Lahore, Karachi and Islamabad. But its also distributing at small cities such such as Faisal Faisalab abad, ad, Gujra Gujranw nwala ala,, and and Multa Multan n but but its main main target is Metropolitan Cities Density: Urban areas

Demographic Segments In demographic segments market divided into different segments like like age, age, gend gender er,, fami family ly size size,, fami family ly life life cycl cycle, e, inco income me leve level, l, occupation, education, religion & nationality. Demographically the target market of NIDO is the middle and upper class. Some of the factors are given below: 

.

Age According to ma manager, Ni Nido 1+ 1+ is is for for th the ch children of of 1 to 3 years, Nido 3+ is for the children of 3 to 6 years and Nido 6+ is for the 6 to onwards children. So, increasing or decreasing child children ren popu populat latio ion, n, givin giving g child children ren fresh fresh milk milk inste instead ad of dried milk etc can affect the brand .



Gender There is no discrimina discrimination tion while using using the NIDO



Family Size Whatever the family size is, NIDO is for every child.



Income Level

The target market of NIDO includes includes those people having an income of 20000 and above. On the other other hand, hand, occupati occupation, on, educatio education, n, religion religion,, race and Nationality play no part in the case of NIDO. .

Psychographic: 

Social Class

In social social classe classes s sectio section, n, comp company any target targets s upper upper class, class, uppe upperr middle, middle class. 

Life Style


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In case of NIDO, strivers, which are mostly young children, are our actual consumers who take NIDO as a milk.

Behavioral: Occasion: Nido is usually bought frequently, so it lies under Regular occasion category. Users: Regular users, potential users. Loyalty Status: Loyalty status is high.. Readiness Stage: Peop People le ar are e awar aware, e, info inform rm,, inte intere rest sted ed,, desi desiro rous us and and intending to buy. Attitude toward Product: The positive attitude exist among the people for the NIDO.

TARGET MARKET Before the introduction of Nido in the market, the company has gone gone the statis statistic tical al calcul calculati ation ons s abou aboutt the popu populat lation ion and and the consump consumptio tion n of the product product and also do market market segmenta segmentatio tion. n. They found that they have an opportunity opportunity of their product in upper middle class and upper class. They also estimated the consumption level and demand for the product and found that an average of upper middle class and upper class needs Nido to feed their children between 3 to 12 years old. NIDO also targets Nido towards housewife as many functions can be perform by using Nido. The target market of Nido is those people who want to buy relatively better quality milk which is good for their children health. This target group specially includes people living in cities. Nido is


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also targeting each and every member of a family i.e. all age groups. WORDS BY PRODUCT MANAGER MR. USMAN WAHEED

We want the mothers to feed that Nido is best for their children. Housewives also contributes in the target market as Nido is used in making many desserts e.g. Kheer, Rasmalai, Custard etc.

Selecting Target Market Strategies: There are four types strategies which which are: 1. Undifferent Undifferentiated iated Marketing Marketing 2. Differentia Differentiated ted Marketing Marketing 3. Concen Concentrat trated ed Marketi Marketing ng 4. Microm Micromarke arketin ting g Nest Nestle le foll follow ow the the undi undiff ffer eren enti tiat ated ed mark market etin ing g in whic which h Nest Nestle le provide NIDO for the whole market.

Position Statement: “Bahtareen Nashonoma ki Majboot Serhi”

PRODUCT STRATEGIES: .

Product Decisions: Nestle make NIDO decisions at the levels: 1. Individu Individual al Prod Product uct Decision Decision 2. Prod Produc uctt Line Line Decis Decision ion 3. Produc Productt Mix Decision Decision (It (It is not discuss discussed ed here) here)

Individual Product Decision:


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Nestle focus on NIDO attributes, brand name, packaging, labeling and product support services in order to make important product decisions. Now, they are discussed one by one: 

Product Quality:

Nestle take great care to maintain good quality of NIDO and keep consistency in their quality. There are laboratories in the factories in which quality of NIDO is checked and then it is send to the market. 

Features:

Nestle unique natural blend of fibers, helps to maintain a healthy digestive system of children. Nido 1+ also contains Vitamins A, C, E, Selenium, Zinc and from that yours child immunity to fight again ainst germ erms and make make the chi childr ldren bones and and mental capabilities strong and healthy. 

Branding:

The brand name of the product is “NIDO”. Also the brand mark of the product is same, i.e. NIDO, but its distinctive way of writing, design and color make it distinctive from competitors’ products and easily identifiable to its customer. The brand mark of NIDO is:

CHARACTERISTICS OF A GOOD BRAND N AME The brand name “NIDO” has the following characteristics, characteristics, which make it a good brand name: characteristics  The name “NIDO” itself speaks for the characteristics and benefits of the products. Brand name “NIDO” is easy to pronounce and  remember. It is distinctive from other brands. brands.  Capable of registration and legal protection.   The brand name “NIDO” relates to future products in a sen sense that that more more prod produc ucts ts of diff differ eren entt form forms s can can be introduced under the assortment of “NIDO” as evident by


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the fact fact that that compa company ny intro introdu duces ces NIDO NIDO in afterw afterward ards s in liquid form. 

Packaging:

aluminum foil, whic The powder form is packed in aluminum which h is furt furthe herr protected in cardboard cartons. Packaging of NIDO protects the pro product duct on its its way way to reta retail iler ers s and and also lso to end end cons consum umer ers. s. Packaging Packaging of Nido is attractive and good to look. At the same time, there are three reasons for packaging:

2.



1. Packaging serves several safety and utilitarian purposes. Pack ackagi aging hel help ps id identi entify fy and di diffe fferen rentiat tiate e it it fr from ot other product. ct. At At the time of purchase the package can serve as silent sales persons. 3. Packaging may increase profit and sales volume aluminum wrapping wrapping of powd 4. The aluminum powder er milk milk prev preven ents ts the the prod produc uctt from from damp dampen enin ing g due due to mois moistu ture re and and help helps s maintaining the quality of the product and preventing it from bacteria. Design

NIDO packaging is designed with special care with unique features and attractive design so that it can attract the customers including parents and children. 

Features Introduce new features like in size and give new varieties such as NIDO1+, NIDO 3+, NIDO 6+.

Socio Economic (Ethical) Packaging The packaging packaging of milk powder NIDO is biodegradable. biodegradable. Thus environmental ental friendly friendly and preve packa kag ging of NIDO IDO is environm prevent nts s pollution.



Labeling:

descriptive ive label label with NIDO has a descript with its its pack pack descr describ ibin ing g the the objec bjecti tive ves s of the the pro product duct,, info inform rmat atio ion n abou aboutt the the use care, are, performance and its pertinent features which are explained above in the introduction of NIDO. It is also advised on packaging of NIDO to keep powder milk in an airtight jar and store in a cool dry place once in use. The label also Fundamentals of Marketing

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states the nutritional information of the product along with tips on preparation for customers’ children. 

Product support Services:

Nestl Nestle e has has specia speciall Custo Customer mer Care Care and and R& R&D D depar departme tment nt which which takes takes the complai complaint/su nt/sugge ggestion stions s about about the NIDO and asses the value of current quality, value and satisfaction NIDO is providing providing to them them.. On the the labe labeli ling ng,, a tool tool free free numbe umberr is give given n for for the the conv conven enie ienc nce e of thei theirr cust custom omer ers s so that that Nest Nestle le can can get get the the feedback.

Product Line Decisions: Nestle follows the “Line Filling” by providing the NIDO in three different varieties which are NIDO 1+, 3+ and 6+ which are for different ages and are also having same prices. So, Nestle filled the line by providing its in different varieties.

Building Strong Brands: .

Nestle has made the brand NIDO by following strategies:

Positioning Among the positioning strategies followed by the company are

1. Target Target Market Market Positioni Positioning: ng: NIDO has been positioned in relation to its target market . It is targ target etin ing g heal health th/d /die iett cons consci ciou ous s pare parent nts s abou aboutt thei theirr children. In addition, the NIDO is also positioned as best for youth seeking fitness and slimness.

Attribute Positioning: NIDO is also positioned as providing the benefit of healthy diet for their children because it contains Proteins, Calcium, Zinc, Zinc, and and Seleni Selenium um.. It prov provid ides es its its users users the appr approp opria riate te content of proteins and calcium necessary for normal bodily activities.

Brand Development:

Nestle has extended the line of NIDO by providing it in thre three e diff diffe ere rent nt form forms s with ith minor inor modif odific icat atiion in ingredients. So, NIDO is following the Line Extension Concept .


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PRICING STRATEGY : PRICING Meaning Of Pricing Pric Price e is the the valu value e plac placed ed on good goods s and and serv servic ices es.. Pric Price e is the the amount of mon money and and / or goods neede eded to acqu cquire som some combination of another and its accompanying services.

Importance Of Price Price is considered to be the key activities within the free enter price system. A products price influences wages, rent, interest and profit. That is the price of the product influence the price paid for the factors of production. Nido’s price is a major determinant of its market demand. Its price represents the firm’s competitive position and its market share. Its price has a considerable bearing on the Nestle’s revenue and net profit because it is only through price that money comes into an organization.

Relationship To Product Quality Consume Consu mers rs rely rely heavi heavily ly on price price as an indic indicato atorr of a prod product ucts s quality especially when they must make purchase decision. The higher price of Nido is a perception for it to be the better quality.

Pricing Objectives The objectives objectives of Nestle for for pricing Nido Nido are as follows follows : 1. Maximum Profit Oriented • To achieve a target return. return. • To maximize maximize profit. 2.

Status quo-oriented: • To stabilize stabilize prices.


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To meet competition. competition. Market share Leadership Product Quality Leadership •

3. 4.

1. Maximum Profit Oriented: 

To Achieve A Target Return:

Target return pricing is typically used by industry leaders because they can set their pricing goals more independently of competition that can other firms in the industry. Nestle has priced Nido to achieve a certain percentage return on its sales. Nestle has settled the price of Nido so that it can earns a net profit of 15% on its net sales. 

To Maximize Profit

According to the economic theory or business practices there is nothi thing wrong with profit fit maxim aximiizati zatio on because ause a profit fit maximization goal for Nestle is far more beneficial to it and also to the public if it is practiced over the long run. To do this Nestle sometimes had to accept short run losses.

2. Status Quo-Goals: The primary primary intention intention of Nestle is to adopt adopt these goals goals to avoid any form form of price price compe competit titio ion. n. Major Major reaso reason n for seeki seeking ng the price price stability is to avoid price wars. This pricing policy gives the Nestle management an easy means of avoiding difficult pricing decisions.

3. Market Share Leadership


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This is related to current situation in short return and not to long run. Nestle select that price which gives it maximum current profit.

4. Product Quality Leadership In this high price of Nido is charged for its superior quality this is done to cover the cost of producing the best quality milk powder in the market. Consumers tend to think that if the price is high than the product quality must be high. .

6. Selecting A Pricing Method 

Cost Plus Pricing Method: Nestle has adopted a cost plus pricing method for Nido. In which a certain markup is added to the cost of the product. Nestl Nestle e follo follow w the popu popular lar markup markup prici pricing ng on cost. cost. Nestle Nestle charge a 15 % profit on the total cost of Nido. Markup = Total Cost * Desired Rate Total Cost = Cost price + Packaging Packaging price + Transportation Transportation Cost +Proportional Funds + Government Taxes + All Middlemen’s Profit Desired Rate for Nido = 15 % Selling Price = Total Cost + Markup Company has cut down the total cost of Nido by cutting down the packing cost of Nido as in imported Nido tin is used which which is expen expensiv sive e but but in local locally ly manuf manufact actur ured ed Nido Nido soft soft packing i.e. packing Nido into a sachet packing and then into soft pack.

Final Price This is the price of Nido which is in agreement agreement with different people such as government, customers, distributors, dealers and Nestle’s sales department. department.


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The final price for Nido is Rs. 130 per 1000 Gms. This price satisfies the quality and standards of Nido.

PRICE ADJUSTEMENT STRATEGIES Geographical Pricing Nido has a vast geographical market. In order to cover the long distances and transportation it has to adjust its price. Therefore, it adjusts its price through uniform delivered pricing strategy. In this strategy average transportation transportation costs are measured and a uniform cost cost is char charge ged d from from all all the the cust custom omer ers s to cove coverr the the aver averag age e transportation cost. So in this strategy all the customers of Nido will pay the same cost irrespective of their location.

PLACING NIDO has no individual distribution system. It is pushed with other companies’ product line. Company has appointed its distribution offices In all major cities of Pakistan.

REGIONAL SALES OFFICES KARACHI

1. 2.

Lackson son squ square building No. 1 5th floor, Block - C, R.A. Lines. Sarw Sarwar ar Shah Shahee eed d Roa Road d Kar Karac achi hi Ca Cant ntt. t. Paki Pakist stan an.. Phone : 5689815, 5689217. Fax : (021) 522775

MULTAN

Near Al-Shifa Poly Clinic, Chungi No. 1 Multan, Pakistan. Phone: 515061 LAHORE 40 - A Zafar Ali Road, Gulberg V, Lahore II. Phone: 870887 Fundamentals of Marketing

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ISLAMABAD

74 - W Yasin Plaza 1st Floor Blue Area, Islamabad, Pakistan. Phone: 211874 - 75, 819686 - 87 Fax : (051) 855608 PESHAWAR 2nd Floor State Life Building, the Mall Peshawar Cantt. Phone: 276274, 274954 Fax : (0521) 276274

In case case of NIDO NIDO the the comp compan any y is usin using g Indi Indire rect ct Whol Wholes esel elle lerr distribution channel e.g. Wholesalers are agents of the company and and they they take take comm commis issi sion on to sell sell NIDO NIDO to reta retail iler ers s and and then then retailers sell it to ultimate consumers. Company has appointed sales officers to monitor the performance of the agents. Every sales officer visits an average of 50 shops a day. In a territory assigned by company he checks that product is available at every shop, improve the displays and check the stock position. The Sales officer prepare a daily sales report and also at the end of the month and submit it to the Head office in Lahore. These Sales officer are guided by a Regional Regional Sales Manager who is a manager of Regional Sales Office. List of regional sales offices is given above. There are four distributors in Lahore and four Sales Offi fficer cers are assi assig gned to ea eac ch distr istriibutio tion to monitor tor the performance of the distributor.

INDIRECT WHOLESELLER DISTRIBUTION CHANNEL Manufa Manu fact ctur urer er Consumer

____ ______ ___ _

Whol Wholes esal aler er

____ ______ __

Reta Re tail iler er

____ _____ _

FUNCTIONS OF DISTRIBUTION CHANNELS The company’s functions 1. Time Utility 2. Place Utility

distribution distribution


channel

provides provides

the

following following

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3. Gath Gathe ers

and Provides infor formatio ation n about the the chang anges, development in the marketing environment. 4. Tries to find and and communicate communicate with the the prospective prospective buyers. 5. Distribution helps in promotion. 6. Helps in negotiation. 7. Helps in transporting and storing goods.

Intensity Of Distribution: In the case case of NIDO, NIDO, Nestle Nestle follo follow w the the inten intensiv sive e distri distribu butio tion n in which it tries its best effort to distribute the product in as many outlets as possible.

Conventional Verses Vertical Marketing System: Nestle NIDO is following Conventional Marketing System because in indirect distribution system, company itself, wholesell wholesellers/d ers/distri istributors butors,, retailers retailers are separate separate entities entities and works as individual. So, Nestle do not following VMS,

PROMOTION NIDO NIDO Nestle Nestle uses uses prom promot otion ion inten intensel sely y to infor inform, m, persu persuade ade and and remind the market of the organizations and / or its products. Promotion is the most important factor in the marketing mix..

Promotional Mix The promotional promotional mix is the combination combination of the personal selling, adverti advertising sing,, sales promot promotion, ion, publici publicity ty and public public relation relations s that helps an organization to achieve its marketing objectives.

1. Advertisement: Advertisement is an essential part of moderate ad so much that it is not possible for an entrepreneur to even imagine a world without advertising. The advertisement page of a news papers, magazines etc. is like a modern novel which gives a “slice from life”. For this purpose NIDO NESTLE is going heavy advertisement on TV, Newspapers, Magazines, and advertisements boards.

2. Sales Promotion: It is designed to supplement advertising and coordinate personal selling, Short term incentives are given to encourage quick sales e.g. Samples, Coupons, gift schemes etc. Promotion is a critical Fundamentals of Marketing

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ingred ingredient ient of many many marketi marketing ng strategie strategies. s. Peoples Peoples have general general appr appreci eciati ation on abou aboutt milk milk powd powder er so that’ that’s s why NIDO NIDO NESTL NESTLE E is doing sampling of its products. However, However, when company finds some break in sales, advertisement is started and some ads are placed on TV but this is not done on permanent basis. Company is satisfied from its promotional programs because it is getting results to its wishes, but now in the near future company has many ambition plans about the promotion of NIDO.

3. Public Relations: NIDO Nestle also has Customer Care Department, which can recei eceive ve feed feedb back fro from the the cust custo omers. Fo Forr the the help of custom customers ers,, a Toll Toll Fre Free e numb number er and and E-mail E-mail addre address ss has has also also been provided.

Push & Pull Strategy: NIDO NESTLE follows a Push Strategy for NIDO since initially there was limited awareness about the product and the producer focused entirely on its channel of distribution for promotion. To motivate retailers to promote sales of skimz, incentives like key chains, mugs, discounts etc. are given to retailers  a kind of sales promotion. Also the company is targeting the end customers through different type types s of adve advert rtis isem emen ents ts ov TV, TV, prin printt medi media, a, etc. etc. in orde orderr to concince them of their product’s benefit and quality so that they deman demand d the the NIDO NIDO from from the reati reatiler lers s  a starte startegy gy called called Pull Strategy .

Promotional Budget NIDO Nestle is following following Percentage-of-Sales methods in which Nestle determine a specific percentage for promotion. promotion. Promotional budget is totally based on the budget available for promotion of the products. NIDO NESTLE spends 20 % of the budget to promote NIDO.


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REFERENCE LIST Mr. Usman Waheed, NIDO Brand Manager, Nestle Company


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Final Report of Nido (1)

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