1Maggi Write-Up

September 25, 2013

THE COMPANY

Maggi is a Nestlé brand of soups, stocks, bouillon cubes, ketchups, sauces, seasonings and instant noodles. The original company came into existence in 1872 in Switzerland, when Julius Maggi took over his father's mill. He quickly became a pioneer of industrial food production, aiming to improve the nutritional intake of worker families. Maggi was the first to bring protein-rich legume meal to the market, and followed up with a ready-made soup based on legume meal in 1886. In 1897, Julius Maggi founded the company Maggi GmbH in the German town of Singen, where it is still based today.

In parts of China, Vietnam, Thailand, Taiwan, Philippines, Singapore, India, Pakistan, Europe, Mexico, Malaysia, Brunei, German-speaking countries, the Netherlands, the Czech Republic, Slovenia, Slovakia, Poland and France, "Maggi" is still synonymous with the brand's "Maggi-Würze" (Maggi seasoning sauce) (in Spain it is sold under name Jugo), a dark, hydrolyzed vegetable protein-based sauce which is very similar to East Asian soy sauce, except it does not actually contain soy. Prior to the early 2000s, Maggi seasoning was an actual soy sauce, using soy and wheat as some of their ingredients, however a change in ingredients resulted in the omission of soy. It was introduced in 1886 as a cheap substitute for meat extract. It has since become a well-known part of everyday culinary culture in Switzerland, Austria and especially in Germany. It is also well known in Poland and the Netherlands. Maggi Würze has huge popularity in Serbia and Macedonia despite not being officially available in those countries. Maggi is also immensely popular in East Asia, Southeast Asia, and South Asia, where Maggi seasoning is used in many soups, stir-fries, marinades and as a dipping/topping sauce. Maggi seasoning is commonly used in Asia as a "soy sauce".

The bouillon cube or "Maggi cube", which was another meat substitute product, was introduced in 1908. Because chicken and beef broths are so common in the cuisines of many different countries, the company's products have a large worldwide market.

Today, Maggi is known throughout the world for its dry soups, seasoning sauce and instant noodle dishes. In New Zealand, Maggi Onion Soup mix is often combined with reduced cream to create an onion dip for potato chips that has come to be generally accepted as a Kiwi favorite. 

In India, Maggi instant noodles are a favorite for an anytime meal. From dorm rooms of colleges to

late-night cooking in home kitchens, it’s an all-time favorite. Maggi Comes to India – teething troubles Maggi noodles was launched in India in theearly1980s. Carlo M. Donati, the present Chairman and Managing Director of Nestle India Ltd, brought the instant noodle brand to India during his short stint here in the early eighties. At that time, there was no direct competition. The first competition came from the ready-to-eat snack segment which included snacks like Samosa, biscuits or maybe peanuts, that were usually ‘the bought out’ type. The second competition came from the home made snacks like Pakore or sandwiches. So there were no specific buy and make snack! Moreover both competitors had certain drawbacks in comparison. Snacks like Samosa are usually bought out, and outside food is generally considered unhygienic and unhealthy. The other competitor, ‘homemade ‘snacks overcame both these problems but had the disadvantage of extended preparation time at home.

2Maggi Write-Up

September 25, 2013

THE BRAND

Launched in 5 flavors initially – Masala, chicken, Capsicum, sweet & sour, and Lasagna –Maggi had to fight hard to be accepted by Indian consumers with their hard-to-change eating habits. The packaged food market was very small at this time; Nestle had to promote noodles as a concept, before it could promote Maggi as a brand. It therefore devised a two-pronged strategy to attract mothers on the ‘convenience’ plank and lure kids on the ‘fun’ plank. Gradually, the market for instant noodles began to grow. The company also decided to focus on promotions to increase the brand awareness. In the initial years, Nestle promotional activities for Maggi included schemes offering gifts (such as toys and utensils) in return for empty noodles pack. According to analysts’ the focus on promotion turned out to be the single largest factor responsible for Maggi’s rapid acceptance. Nestlé’s Managers utilized promotions as measured to meet their sales target. Gradually, sales promotion became a crutch for Maggi noodles sales.  Later many of the Maggi’s extensions also made considerable use of promotional schemes. The focus of all Maggi’s extensions was more on below the line activities rather than direct communication. In addition to promotional activities, Maggi associated itself with main stream television programmed and advertised heavily on kids program and channels. After its advertisements with taglines like “mummy bhookh lagi hai, bas do minute” and fast to cook good to eat Maggi’s popularity became highly attributed to its” extremely high appeal to children”. As a result, Maggi’s annual growth reportedly touched 15% during its initial years.

PRODUCT LINE

The product mix of Maggi is divided into various categories defined below. The company has launched various products under each category as mentioned below.

1. Noodles

Maggi 2-Minute Noodle ( Masala , Chicken, Curry and Tomato)

Maggi Dal Atta Noodles ( Sambhar taste)

Vegetable Atta Maggi Noodles

Maggi Rice Noodles (Lemon Masala, Chilly Chow and Shahi Pulao)

Maggi Cuppa mania (Masala yo, Chilly chow yo)

2. Sauces

Teekha masala

Tomato chatpat

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September 25, 2013

Imli khata mitha

Tomato ketchup

Hot and sweet

Tomato pudina

Ginger, Garlic & Coriander 

Maggi Oriental Chili Garlic

Ginger, Garlic & Coriander 

3. Maggi Pichko

4. Soups Healthy

Chef Style

Cream Mushroom

Sweet Sour Tomato Noodles

Tangy Tomato Vegetables

Home Style

Creamy Chicken

Mixed Vegetable

Rich Tomato

Chinese Style

Chinese Hot Sour Chicken

Chinese Sweet Corn Chicken

Chinese Sweet Corn Vegetables

Chinese Hot & Sour Vegetables

5. Maggi soup sanjivni

Amla

Badam

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September 25, 2013

Spinach

Dal

Tomato

6. Maggi bhuna masala

Bhuna masala for gravy dishes

Bhuna masala for vegetable dal

7. Maggi magic cubes

Chicken

Vegetarian masala

SWOT ANALYSIS

Strength Established Family Brand

Strong Global Corporate Brand ( NIL )

Specialization in food processing category marketing and distribution in Urban Market leader

Presence of other product segments of food category : Dairy Products,

Chocolate, Infant foods

Pioneer and Leader so 1st mover advantage in Noodles, Sauce, Ketchups and Soup market.

Nestle symbolization of warm, family & shelter

Research and Development Division in India

New Noodles Plant in Uttaranchal

Innovative flavors for Indian taste buds

Distribution Channels

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September 25, 2013

Weakness Generic Brand to Noodles in India

Low rural market presence constraints

Uniform Brand for all food category

Brand Proliferation

Heavily dependent on one flavour

Health related issues

Opportunity

Growing package and canned food market in India by 15% annually.

High brand awareness of Indian consumer

Other product category like Biscuits, Chips and Ready to Eat Market still unexplored.

Opportunity to be substitute to other snacks category of food products.

Unexploited rural market

Increasing number of working youth

Affinity of Indians to Chinese food

Threats Competitors with long history in product category Internationally like, Heinz Sauce and ketchups of Heinz Indian, Top Ramen in Noodle and Knorr Soups.

Single product focused competitors like Heinz sauce and Wai Wai Noodles.

Less Entry Barriers in the Market segment for product category

ITC’s strong base in Indian Market.

Substitute Product to Product Segment

Competitive pricing

Strong presence of regional competitor

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September 25, 2013

STPD ANALYSIS OF MAGGI BRAND

Segmentation

Market Segmentation divides the heterogeneous market into homogenous groups of customers who share a similar set of needs/wants and could be satisfied by specific products. Maggi Brand have segmented the market on the basis of lifestyle and habits of URBAN FAMILIES.

Target

Market Targeting refers to evaluating and deciding from amongst the various alternatives, which segment can be satisfied best by the company. The Maggi Brand have mainly targeted the Kids, Youth, Office Goers & Working Women who fall into the category of “convenience-savvy time misers” who would like to get something instant and be over with it quickly.

Positioning

Market Positioning is the act of designing the company’s offerings and image to occupy a distinctive place in the minds of the target market. The goal of positioning is to locate the brand in the minds of consumers to maximize the potential benefit to the firm. Maggi has positioned itself in  the SNACKS category and not in the meal category since Indians do not consider noodles as a proper food item. Therefore Maggi have developed its brand image of instant food products with positioning statements such as “2 minutes noodles” and “Easy to cook, good to eat”.

Differentiations

Points-of-difference (PODs) are attributes or benefits consumers strongly associate with a brand, positively evaluate and believe they could not find to the same extent with a competitive brand. The Maggi Brand has also differentiated its brand image from its competitors in terms of taste, flavors and packaging. Maggi have launched wide varieties of products in different flavors which can attract larger set of customers. Maggi products are also available in different sizes catering to different customer needs

MARKETING MIX

Product

Maggi has come up with various products according to the needs of consumers. Some of them became very popular and some of them were total failure. The products that passed the test of time are as follows:

Maggi 2-Minute Noodles is one of the largest & most loved snack food brand that defines the Instant Noodles category in India. It is now available in 5 flavours: Masala, Chicken, Tricky Tomato, and Thrilling Curry & Romantic Capsicum.

7Maggi Write-Up

September 25, 2013

Maggi Vegetable Multigrainz Noodles is a product which is a source of Protein, Calcium and Fibre, and has added vegetables. The inspiration for the product comes from the growing consumer preference for a healthier lifestyle.

Maggi Vegetable Atta Noodles is healthy because it is made of wheat flour and has more real vegetables and is packed with the power of fibres.

Maggi Cuppa Mania is a combination of all the above. It’s an easy to carry on-the-go Cup format, Maggi Cuppa Mania comes in two variants – Masala Yo! And Chilly Chow Yo.

Price

In terms of pricing company has placed its product in such a way that products enjoy huge benefit against the competitor. The price also enables huge opportunity for impulse buying. Products are priced in round off figures e.g. Rs 10, Rs 50. As a result of such pricing strategies products are the only option in the range of conventional snacks category.

Promotion

Over the years Maggi became an integral part of the Indian household like other FMCGs like Coke or Pepsi. TV commercials played an important part in it. Elements that have stayed constant in any Maggi film include the jingle -- ‘Maggi, Maggi, Maggi’ in a sing-song voice, the family setting, and the ‘two minutes’ promise, which started off as a USP, but took a backseat eventually. Maggi has generally stayed away from taking the celebrity endorsement route. All the ads for the brand usually focus on the mother-child relationship. “The mother and child are the celebrities for Maggi”.

Other innovative ads like the Maggi voiceover campaign which is a collection of short vignettes, showcasing consumers’ memories of Maggi just brought Maggi closer to the heart of India. As a part of its promotional drive, Maggi has launched a website, meandmeri.in, where consumers can upload their Maggi moments and submit their favourite Maggi recipe. Consumers, whose stories or recipes are a hit with the company, will get a chance to be featured on Maggi packs or ads. Apart from the TV commercials they promoted the product by

1. Distributing free samples.

2. Giving gifts on return of empty packets.

3. Dry sampling-distributing Maggi packets

4. Wet sampling - distributing cooked Maggi.

5. Availability in different packages 50gm, 100gm, 200gm, etc.

6. Effective Tagline Communication.

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September 25, 2013

Placement

Nestle Maggi Noodles is famous not only in urban areas but also in rural areas. It is rightly available at number of retail shops and malls so that consumers can easily purchase the product without much efforts.

FUTURE DIRECTION

Nestlé India’s objective is to manufacture and market the company’s products in such a way so as to create value that can be sustained over the long term for consumers, shareholders, employees and business partners.

Maggi’s aims to create value for consumers that can be sustained over the long-term by offering a wide variety of high quality, safe food products at affordable prices.

The company continuously focuses its efforts to better understand the changing lifestyles of modern India and anticipate consumer needs in order to provide convenience, taste, nutrition and wellness through its product offerings.