1. BRAND EXTENSION OF
MAGGI
GROUP 6
Avinash
Ranjith
Shushanta
Swaitlana
Thanmai

2. A BRIEF HISTORY
• The Company was founded in 1866 by Henri Nestlé in
Vevey, Switzerland
• Employs around 2,80,000 people
• Has factories or operations in almost every country in the world
The Indian Story
• 1912: Began trading as The Nestlé Anglo-Swiss Condensed Milk Company (Export) Limited, importing and
selling finished products in the Indian market.
• set up its first factory in 1961 at Moga, Punjab, where the Government wanted Nestlé to develop the milk
economy
• Manufactures products under internationally famous brand names such as
NESCAFÉ, MAGGI, MILKYBAR, KIT KAT, BAR-ONE, MILKMAID, NESTEA ,NESTLÉ Milk, NESTLÉ SLIM
Milk, NESTLÉ Dahi and NESTLÉ Jeera Raita
• In India Maggi was launched in 1980s by Nestle group of companies
• Maggi had merged with Nestle family in 1947.
• The brand is popular in Australia, India, South Africa, Brazil, New
Zealand, Brunei, Malaysia, Singapore, Sri Lanka, Bangladesh, Fiji and
the Philippines
Offerings under Maggi brand in India:

3. A POSITIVE OUTLOOK
Revenue % India’s food consumption grows at CAGR of 5.3% to
Milk Products & Nutrition reach $230 Bn in 2013
14%
14% 44% Prepared dishes & Cooking
aids
Chocolates &
28% Confectionaries Increasing rural consumption of instant foods
Beverages
By constantly launching new products and
leveraging the distribution network NIL has
doubled its revenues by growing at CAGR
of 20.6%
Company enjoys high brand equity.
Profitability growth at 25.1% CAGR
Expected growth (CAGR CY11-13E) in prepared dishes
& cooking aids (Maggi) to be 20.5% (volume growth of
17%)
*Source: Research by ICICIdirect.com dated March 23, 2012

4. SHIFT IN LANDSCAPE
With the instant noodles market estimated at 1500 crore
(FY11) the total consumption is only 1500 million packs
(considering | 10/pack) thereby accounting a mere 1.3
packs/person per annum
With the segment growing at 20% p.a. and expected to
reach 3200~3500 crore by 2015 consumption would only
reach 2.7 packs/person per annum
In the last two years, many new players have entered the
noodles category like GSK’s Foodles, ITC’s Sunfeast Yippee
and HUL’s Knorr soupy noodles.
Simultaneously, most of the brands have been launched in
different variants like multi grain, masala and atta noodles.
A survey conducted by Nielsen shows that Maggi’s market
share has fallen by around 15 percent since the launch of
these new brands
Escalating competitive pressure could slightly trim NIL’s
volume growth (CAGR) to 17.0% and the price led growth to
3.0%,
Volume growth in CY11 has been 7.7% as against average
14.2% in the previous five years
Maggi brand is feeling a disconnect with the new
*Source: Research by ICICIdirect.com dated March 23, 2012 generation customers who now have more choices for
www.valueresearchonline.com indulgence other than noodles

5. CURRENT BREAKFAST MARKET
• There is a steady growth in the number of households
adopting new breakfast categories at around 30% and the Packaged breakfast market (Crores)
penetration of breakfast cereals has doubled* 1600
• Marketers estimate that this handsome growth rate will 1400
only increase, with key drivers being growing 1200
affluence, double-income couples and increasing 1000
800 Packaged breakfast
acceptance of non-Indian foods.* 600 market (Crores)
• Market for Oats was estimated at 150Cr in 2012. By 400
considering growth rate in the segment, by 2016 this 200
market can grow to 577Cr** 0
2011 2012 2013 2014 2015 2016
Strengths Weaknesses
Healthy Requirement of steam / hot water
Time saving High distribution network required
Portable Perceived to be tasteless
Flexibility in usage Nestle to enter Oats market
Opportunities
SWOT
Increasingly health conscious
audience Threats
Microwave skeptics Low entry barriers
Need for convenience food Highly established competitors
Lesser number of players Current breakfast trends
Source: *Times of India report dated July 11,2011
**Times of India report dated June 21,2012

6. FORAY INTO OATS MARKET
The attributes of
PRODUCT
the product
The pricing PRICE
strategy
The marketing
PROMOTION strategies and what
needs to be conveyed
Distribution
techniques PLACE

7. PRODUCT
As the initial market share would be low, Oats product
would be in the ‘question mark’ quadrant. As it gains BCG Matrix : Nestle
popularity it is expected to move to ‘star’ or ‘cash cow’ Nescafe Milo
quadrant
High
Cerelac Maggi Sauce
Maggi Soup
Kit-Kat
Nestle Milk
Oats
Objective: To identify the essential attributes and values
Maggi Noodles Nestea
Growth rate
that consumers look for in a breakfast product
Milky Bar
Methodology: Conjoint analysis based on questionnaire
Low
Munch
and ladder technique based on FGD
High Low
Relative Market Share
CONJOINT ANALYSIS LADDERING TECHNIQUE
RESULT
The product features: Brand name, Nutrition and Convenience
Value to be delivered: Sense of belonging, Self esteem, Accomplishment and Responsibility

8. PRODUCT:CONJOINT ANALYSIS
Nutrition Time to Your
S /N Brand Form Value (% Taste Cook (in Price Preference Each respondent is asked to rate the intent
of RDA) mins) Rating to purchase based on the following
1 Quaker Snackbar High Sweet 0 High parameters:
2 Kelloggs Porridge Medium Salty 5 Medium • Brand Name (B)
3 Britannia Porridge Low Spicy 2 Low • Nutrition (N)
4 Saffola Additive High Salty 5 Medium • Form (F)
5 Saffola Porridge Medium Spicy 5 Low • Taste (T)
• Convenience/Minutes to cook (M)
6 Kelloggs Snackbar Low Salty 0 Medium
• Price (P)
7 Quaker Porridge High Sweet 2 High
Base case:
8 Britannia Porridge High Sweet 5 High • Brand – Kellogg's
9 Quaker Snackbar Medium Salty 0 Medium • Nutrition- High
10 Kelloggs Porridge High Sweet 5 Medium • Form- Snack bar
11 Britannia Snackbar Low Sweet 0 Low • Taste- Sweet
12 Saffola Porridge Low Salty 2 High • Convenience- 0 min
13 Kelloggs Additive Low Salty 2 Low • Price- High (> Rs.130)
14 Quaker Porridge Medium Sweet 5 Medium
15 Britannia Additive High Spicy 2 Medium
16 Quaker Snackbar Medium Spicy 0 High Rule of thumb for sample size
17 Kelloggs Porridge High Salty 2 Low nta/c > 1000
18 Kelloggs Snackbar Medium Sweet 0 High n : no: of respondents
19 Britannia Porridge High Sweet 5 Medium t : no: of tasks
20 Quaker Porridge Medium Salty 2 Medium a : no: of alternatives
21 Quaker Snackbar High Spicy 0 Low
c : largest no: of level for one attribute
22 Britannia Additive Low Salty 5 Low

9. Model Summary PRODUCT:CONJOINT ANALYSIS
Model R R Square Adjusted R Std. Error of
Square the Estimate
1 .952a .928 .698 .86753
a. Predictors: (Constant), Pl, Bs, M2, Bk, Fa, Nm, Tp, Nl, Pm,
M5, Ta, Bb Each respondent is asked to rate the intent
ANOVAa to purchase based on the following
Model Sum of df Mean F Sig. parameters:
Squares Square • Brand Name (B)
Regression 67.177 15 4.478 5.951 .018b • Nutrition (N)
1 Residual 4.516 6 .753 • Form (F)
Total 71.693 21 • Taste (T)
a. Dependent Variable: Rat
• Convenience/Minutes to cook (M)
b. Predictors: (Constant), Pl, Bs, M2, Bk, Fa, Nm, Tp, Nl, Pm, M5, Ta, Bb • Price (P)
Base case:
Coefficientsa
• Brand – Kellogg's
Model Unstandardized Standardized t Sig.
• Nutrition- High
Coefficients Coefficients
• Form- Snack bar
B Std. Error Beta
• Taste- Sweet
(Constant) 6.111 .824 7.419 .000
• Convenience- 0 min
Bk -1.076 .868 -.397 -1.240 .048
• Price- High (> Rs.130)
Bb -1.027 1.120 .669 -.918 .383
Bs -1.613 1.239 -.459 -1.302 .032
Fa 1.395 .938 .446 1.486 .171
Fp 1.256 .563 .195 1.067 .249 Unstandardized
Standardiz
ed
Coefficients Coefficient t Sig.
Nm -.147 .821 -.257 -.179 .062 s
1 B Std. Error Beta
Nl .092 .994 .934 .093 .928 (Constant) 6.111 0.824 7.419 0
Bk -1.076 0.868 -0.397 -1.24 0.048
Ta -.831 1.012 -.139 -.821 .433 Bb -1.027 1.12 0.669 -0.918 0.383
Bs -1.613 1.239 -0.459 -1.302 0.032
Tp .292 1.056 .102 .277 .788 Fa 1.395 0.938 0.446 1.486 0.171
Nm -0.147 0.821 -0.257 -0.179 0.062
M5 .916 1.006 .965 .910 .386
M2 .486 .803 .188 .605 .056
Pm .490 .890 .200 .551 .595
Pl -.074 .981 -.029 -.075 .942

10. PRODUCT:LADDERING TECHNIQUE
•3 rounds of FGD with 10 respondents who indicate oats as their preferred breakfast
• Laddering technique used to elicit response from participants (Attribute->Consequence->Value)
Sense of Self Esteem Accomplishment: Responsibility
Belonging more from life
Time for other
activities
Meeting
Objectives
Self Inc. Save Money
Satisfaction Concentration
Stress Buster
Relax More work
Good for body
Saving time Shortage of Satisfaction Fun
time
Fast to cook Convenience Healthy Taste and Affordable
Variety

11. PRICING
•Price is not an important factor for products in this segment (breakfast) as understood from conjoint
analysis
•Pricing based on existing competitor’s offerings

12. PROMOTION
• IMC to aim at overcoming the consumer perception about the negative correlation between taste and health
• Focus on the values of accomplishment and self esteem which can be traced back to the attributes of health and
convenience
Television
• Ads which show the entire family consuming oats : children, parents and
grandparents
• Scope to show the different variants of the product, catering to different segments
Print
• Ads in health magazines such as Health, Stay Fit, Diabetic Living etc
Publicity
• Press conference depicting the dual health+taste benefit of oats
• Nestle’s history of expertise and innovation to be highlighted to create goodwill
Sales promotion
• Consumer franchise building promotions
• Sampling in schools, gymnasiums and retail stores (breakfast bars)
Place Advertising
• Point of purchase advertising in the form of attractive posters in stores
• In store strategies for effective product placements in retail outlets

13. PROMOTION
Social Media can be leveraged to build Word of Mouth publicity perceived as the most trusted source of
advertising
Social media is becoming a huge part of our
culture with Facebook fan pages, apps etc.
Customers now have more power to express their
opinion and share their experience with their
online social circles
Each one of your customer has a circle of 250
people – Thanks to the influence of social media
Special Occasion menus with oats on the
website or Facebook page – to attract first timers
Regular updating with special offerings and
promotions and sampling of new
product, detailed customer feedback & review
section

14. PLACE
• Nestle ’s distribution channel to be leveraged
• Can be introduced in tier one cities initially
• Trade promotions in the form of financial incentives or discounts given to retailers, distributors, and
other members of the trade to stock, display, and in other ways facilitate the sale of the product can
be given to push retail sales