Nestle Fruit Yougert

A PROJECT OF STRATEGIC MARKETING ON

Nestlé FRUIT YOGURT PRESENTED TO Professor COL. SOHAIL AKRAM

PRESENTED BY Mohsin Ali Adnan Safder Ahsan Ajmal Umair Raiz Fakhar Zaman

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ACKNOWLEDGEMENT In the context of this project report, we would like to thank all the personalities who helped us in achieving our objectives from the learning point of view. With the grace of Almighty Allah we are able to finish our final project of strategic marketing on Nestlé fruit yogurt. We are very thankful to our beloved teacher who helped us a lot in writing of this project and showed us the right way in order to complete this project. We would also like to say thanks to Asif Ali Khan, Chilled dairy Manager for helping us and giving his very precious time. We also like to thank our college authorities to provide us with all the needed facilities. We also want to thank our parents on the behalf of this project report in helping us and praying us all way long for our success and better health. We did our best to complete this project and tried to take information from every possible source and to make this project as much realistic as possible.

Mohsin Ali

Adnan Safder

Ahsan Ajmal

Umair Raiz

_________________ Fakher Zaman

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TABLE OF CONTENTS ACKNOWLEDGEMENT........................................................................................ 2 TABLE OF CONTENTS.........................................................................................3 EXECUTIVE SUMMARY......................................................................................5 NESTLÉ MISSION..................................................................................................6 NESTLÉ VISION.....................................................................................................6 NESTLÉ’S INTRODUCTION................................................................................7 NESTLÉ IN PAKISTAN.........................................................................................8 DEPARTMENTS.....................................................................................................8 ORGANIZATION CULTURE................................................................................8 SITUATION ANALYSIS........................................................................................9 SWOT ANALYSIS............................................................................................9 Strengths.......................................................................................................9 Weaknesses................................................................................................10 Opportunities..............................................................................................12 Threats........................................................................................................13 ENVIRONMENT ANALYSIS........................................................................14 Demographic Analysis...............................................................................14 Technological Analysis..............................................................................15 Economic Factors.......................................................................................15 Ecological Analysis....................................................................................16 Political & Legal Analysis.........................................................................16 Education System.......................................................................................16 DISTRIBUTION ANALYSIS.........................................................................16 Distribution Constraints.............................................................................17 Retailer Incentives......................................................................................18 Recommendations......................................................................................18 TARGET MARKET..............................................................................................18 MARKETING INTERFACE.................................................................................18

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4 Product........................................................................................................1 8 Price............................................................................................................19 Place...........................................................................................................19 Promotion.................................................................................................. 19 STRATEGIC RECOMMENDATIONS……........................................................20 PRODUCT.......................................................................................................20 Addition of more flavors............................................................................20 More uses different recipes like desserts....................................................20 PRICE AND PACKAGING............................................................................20 Price............................................................................................................20 Resizing of the pack...................................................................................21 PEOPLE...........................................................................................................21 Different Target Market.............................................................................21 Target Audience.........................................................................................21 PROMOTION..................................................................................................21 TV Program................................................................................................22 Kiosks.........................................................................................................22 Billboards...................................................................................................25 Banners.......................................................................................................25 Magazine ads..............................................................................................26 Newspapers................................................................................................27 Advertisement............................................................................................28 MONITORING & REVIEWING..........................................................................29 REFERENCES/APPENDICES.............................................................................32

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EXECUTIVE SUMMARY First of all we probe for the reasons of failure of the Nestlé Fruit yogurt and after that we come up with new strategies (Market plan) that can help in the improvement of the fruit yogurt. We changed its positioning statement that was just focusing on children. We analyzed that Nestlé has a very organized system for handling in each product. There is one chilled dairy manager for the Yogurt Company and he is responsible for the success and development of all the yogurt products. Nestle spend a fixed profit on marketing of a certain product. Less profit in Nestle Fruit Yogurt ends up with low involvement in their marketing efforts. They are not worried about the low acceptance of this product as they already knew that fact. They also believed that with the passage of time sooner or later the nestle fruit yogurt will mark its acceptance in the consumers minds. The result of the survey conducted by us shows that the product is tasted and used by many people but it is not accepted by them because of less awareness and promotion whereas company has its own strategies regarding promotion of the product. Total budget for promotion depends on the sales volume. Almost 80% sales are generated from plain yogurt whereas 20% from the flavored yogurt out of which fruit yogurt generates only 5%. We repositioned it by expanding it target market and increasing its users. We established positioning statement of “Tingle your taste buds with Nestle Fruit Yogurt”. We analyzed that the major thing nestle fruit yogurt was lacking was its package size. We have also changed its original size into different sizes. Due to lack of awareness, we increased its marketing through billboards, advertisements on TV and newspapers and also by putting banners along the roadside. We also planned to start a Television 5 minutes recipe show. We believe that (particularly) Nestle Fruit Yogurt needs to focus on its diverse image. Nestlé needs to expand market by focusing on different age groups and by increasing its uses.

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NESTLÉ’S MISSION “At Nestlé, our research makes it possible for everyone to enjoy better food for a better life.” Good Food is the primary source of Good Health throughout life. We strive to bring consumers foods that are safe, of high quality and provide optimal nutrition to meet physiological needs. In addition to nutrition, health and wellness, Nestlé products bring consumers the vital ingredients of taste and pleasure. As consumers continue to make choices regarding foods and beverages they consume, Nestlé helps provide selections for all individual taste and lifestyle preferences. Research is a key part of our heritage at Nestlé and an essential element our future. We know there is still much to discover about health, wellness and the role of food in our lives, and we continue to search for answers to bring consumers Good Food for Good Life.

NESTLÉ’S VISION “Nestlé aim is to meet the various needs of the consumer every day by marketing and selling food of a consistently high quality.” The confidence that consumers have in our brands is a result of our company’s many years of knowledge in marketing, research and development, as well as continuity – consumers relate to this and feels they can trust our products. The mission and vision statement covers almost all perspectives. Therefore, no necessary changes are required for it. But particularly for Nestlé Fruit Yogurt, we have made a tag line or positioning statement as: “Tingle your taste buds with Nestle Fruit Yogurt”

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NESTLÉ’S INTRODUCTION Nestlé with headquarters in Vevey, Switzerland was founded in 1866 by Henri Nestlé and is today the world’s biggest food and beverage company. Sales for 2006 were CHF 98.5 bn, with a net profit of CHF 9 bn. Nestle employ around 265,000 people and have factories or operations in almost every country in the world. Nestlé is the largest food and beverage company in the world. It is also well on its way to becoming world leader in nutrition, health and wellness. The Nestlé Company is built on the foundation of very strong brands. Some are global, others are regional, and many are local to a specific country.

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NESTLÉ IN PAKISTAN Nestle Pakistan Limited Formerly known as Nestle Milkpak Limited. The Group’s principal activities are to manufacture process and sell food products and ancillary equipment. The food products include diary, confectionery and culinary products, coffee and beverage and drinking water. The major brands include MILKPAK UHT, NESTLE EVERYDAY, LACTOGEN and NESCAFE.

DEPARTMENTS In Nestlé Pakistan, the departments are divided on the basis of the brands. Nestlé Fruit yogurt has a separate functional department. All the yogurt products are managed by Chilled dairy manager. All the finances, marketing, distribution, production and other departments come under the control of chilled dairy manager.

ORGANIZATION CULTURE The Company’s strategy is guided by several fundamental principles. Nestlé’s existing products grow through innovation and renovation while maintaining a balance in geographic activities and product lines. Long-term potential is never sacrificed for short-term performance. The Company’s priority is to bring the best and most relevant products to people, wherever they are, whatever their needs, throughout their lives.

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SITUATION ANALYSIS SWOT ANALYSIS Strengths •

Company Name: The name of nestle is no doubt a strength as it

has the trust and reliability in the consumers mind and people do prefer nestle products especially dairy products over other brands. •

Quality: Nestlé is the biggest manufacturer of food products in the

world. Nestle name is a symbol of quality. They have always provided products of high quality. All of their products are quality assured and certified by the quality assurance companies and production facility certificate providers such as ISO certifications and FDA approval certificates. Nestle before launching any product into the market place always makes sure that it is not in any way harmful for the public. This quality however varies from country to country e.g. Nestle juices in Pakistan are all artificial with preservatives whereas in other parts around the world such as States they are natural preserved with citrus. But this difference however doesn’t mean that the products are of low quality in that particular country because in Pakistan the trend of natural juices is not there yet so it is of the highest quality compared to any other locally manufactured juice. In the similar manner their yogurt is also of the highest quality in the market place. •

Manufacturing processes: Nestle have state of the art machines,

process and techniques which help them to produce better and better of the all. •

Trustworthy company: Nestle name is a symbol of trust. The

consumers trust that their products will do them no harm. Any thing with nestle written on it is trusted by consumers and with the trust they have established over the years not only in Pakistan but also in other places across the Globe they have sold many products. No one doubt nestle products, if it’s going to be good, that’s what the consumers

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10 believe and so have faith in the company. No wonder Nestle yogurt has the highest market share in Pakistan. •

Consumption in Punjabi Culture: In the Punjabi culture the

consumption and manufacturing of yogurt is very high. Even before Pakistan came into being in 1947 Yogurt has been a part of everyone’s life in Punjab whether it is Indian Punjab or Pakistani Punjab. Yogurt is used for many purposes especially for cooking. In cooking yogurt plays a major role as many Desi dishes are prepared in Yogurt. Along with that there are many other uses of Yogurt. It is also used for making other products such as Lassi etc. Lassi is a part of every Punjabi especially in the areas which have more heat as in the south belt of Punjab. Many Lahori drinks lassi in the morning or at night. It is a part of their daily intake of food. It is also used when a person wants to go to sleep as it slows down the brain functions and puts a person to sleep. However it’s not a drug or something but a natural product which is extremely good for one’s health.

Weaknesses •

Lack of awareness: A major drawback in the low consumption of

fruit yogurt is the lack of awareness among the consumers. Many people don’t even know that it exists. It did launch with a fury in the market but because the trend was not already there in the market, the sales were very low. Nestle is the only company to come up with fruit yogurt in the local market despite the fact that the need for it was always there. People are not aware of fruit yogurt in remote areas of Punjab. Nestle only focused on advertising in major cities across Pakistan, so this left other areas suffering from a lack of awareness of the product. •

Big accounts: Nestle does not have many big accounts to keep the

budget of advertising high. Nestlé’s budget for advertising is a fixed percentage of sales. The sales are not high therefore the advertising of the product suffers. Nestle doesn’t have many key or national accounts so that the product has relatively high sales and can match up to other

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11 products of nestle. The only major accounts that they do have are of PIA and a few corporate offices. Their corporate level customers are also very low compared to other products of Nestle. •

Availability:

Availability is another major issue in the low

volume of sales of Nestlé’s Fruit Yogurt. Retailers don’t want to keep an item in their stock that takes up their freezer space. But nestle did give retailers freezer’s to keep the product but many of them still refused to keep the product because it takes up space that could be utilized for other FMCGs which have higher profits or a high turnover as a result of their higher demand. •

Lack of Distributors’ interests: Distributors don’t prefer this

product because it has to be transported in chilled containers and the level of sales is so low for this product that they’d rather transport other products which do not require transportation in chilled trucks. The distributors prefer transporting other products with similar needs of transportation but with relatively very high volume of sales such as Walls ice cream in their container or even the normal yogurt of Nestle which gives them high returns as there is a very high demand of the product. •

Chilling need: This product has to be kept frozen and has a very

little expiry time which is of 10 – 15 days. After 10 – 15 days the stock has to be replenished. This is another issue in the low sales of yogurt. Even if the retailer decides to keep the product the sales are not very consistent as to predict the amount of sales for the product. The sales fluctuate as many people are not aware of the product and neither takes it as a delicacy but instead children tend to look towards it as a health product. The chilling factor is very annoying for the consumer as well because they can’t store it for much long first they buy it from a retail outlet then have to store it at home for future purposes in their fridge and in case the yogurt expires the fridge starts to have a very foul smell which is absorbed by other food items which in turn causes hatred for the product and discourages repeated purchase of the item.

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South Pakistan culture: The yogurt as a product whether loose or

packed is not a part of Sindh and the southern belt of Pakistan. Only 10-12% of the total sales are in the south. Due to climate of South, people prefers products such as tea and related items over products such as yogurt, lassi etc. The south has not yet developed a yogurt consuming culture so far. They do however have the tendency to develop such habits but it will take ages to develop.

Opportunities •

Potential market for fruit yogurt: There is a high potential for

fruit yogurt especially in Punjab. Lahore and Islamabad are already generating good sales of the product. Nestle fruit yogurt like every other nestle product has a one year management business plan and a 10 year product plan. So far it is somewhat meeting the minimum required sales to keep the product in the market. But the sales have improved quite well after the latest campaign of the product. It already has a consumption of 400 ton/month all over Pakistan despite the fact it is a very small brand of Nestle. There is a total consumption of 65,000 tons of urban yogurt consumption out of which 1.7% consumption is of loose yogurt and 1.8 million tons of general yogurt which includes loose and packed yogurt. These high figures do indicate that the potential is always there for fruit yogurt to take a chunk of the total market share of packed yogurt. People are coming towards packed yogurt just like they did in the case of tetra pack milk. Milk now has a very high share of the total milk market and same is expected for the yogurt with the changing trends and along with that great demand for fruit yogurt is also expected in the future. •

Climate of Pakistan: The best time to cash in on such a product

are the summers. In summers children as well as adults are looking for chilled flavored products such as ice creams, shakes, juices etc. Along with that they will also be looking forward to eating fruit yogurt. The consumption of yogurt in the summers is as follows: i. 42% plain form

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13 ii. 23% lassi iii. 21% meal component such as raita iv. 13% culinary This high usage of yogurt in the plain form also gives Nestle an opportunity to sell chilled fruit yogurt in summers. •

Tax exemption: This year everyone was wondering why so many

dairy products are entering the market. The reason for this was the exemption given by the government on dairy products. Many companies entered the market as no sales tax was being charged on dairy products but still all the companies were selling the products at the same price as before which meant that the 15% they previously paid to the government was now going into their own pockets. The reason for the current high budgeted advertising for fruit yogurt was also the same as the government refunded the sales tax for the previous years. That was invested in the advertising of the product. This recent tax exemption in technical terms means that the sales tax rated zero on dairy products. Government has also started paying input adjustments which means that there are also no taxes on the purchase of the products used in manufacturing dairy products.

Threats •

Poor economy: The reason for the high purchase of loose yogurt

which is 65,000 tons is mainly because packed yogurt is relatively twice that price. The poor economy and purchasing power of the people of Pakistan does not allow them to purchase packed yogurt. This poor economy is however becoming better and better as the time passes. The country has a whole has an increase in per capita GDP every year which means that this would with the passage of time change. With the advent of WTO implementation in the country the times would change. This poor economy which currently persists doesn’t allow for the fruit yogurt to become a high sales product in the local market.

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Big size families: The big size of the Pakistani family is another

major issue and reason for the so termed failure of the fruit yogurt in the local market. Pakistan has a very high population and an alarming growth rate. The population is around 150,000,000 and the people per square km are around 534. These statistics are very high. And fruit yogurt with these high stats can’t feed all of the yogurt loving families. This product can’t in any way fulfill the needs of such big size families. While purchasing yogurt or for that matter fruit yogurt the cost of purchasing the product for the whole family becomes very high. This is a major issue in the success of the product that it can’t be bought for the whole family or at least for the kids for that matter. The price for even feeding the average number of kids of a family which are around 5 in Pakistan the cost comes around to Rs.75 whenever you want to buy yogurt for your kids which is very high keeping in mind that the per capita GDP in Pakistan is only $2803. This constitutes a lot of burden financially on an average Pakistani family. A mere average salary of Rs.14,015 which has to feed 7 people on the average which means that the cost of living comes around to be Rs.2000 per person out of which if they start spending Rs.75 on fruit yogurt daily means that the cost would be 2250 which means a deficit Rs.250 would occur.

ENVIRONMENT ANALYSIS Demographic Analysis: •

Population: 165,803,560 (July 2006 EST.)

•

Age structure: o 0-14 years: 39% o 15-64 years: 56.9% o 65 years and over: 4.1%

•

Population growth rate: 2.09% (2006 EST.)

•

Ethnic groups: Punjabi, Sindhi, Pashtun (Pathan), Baloch, Muhajir

•

Religions: Muslim 97% (Sunni 77%, Shi’a 20%), Christian, Hindu, and other 3% Tingle your taste buds with Nestle Fruit Yogurt

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Diet and Nutrition o In Pakistan, the nutritional status of children under five years of age is extremely poor. o At a national level almost 40% of these children are underweight. o In the Pakistani diet cereals remain the main staple food providing 62% of total energy. The consumption of fruit and fresh vegetables, which are highly dependent on local seasonal availability, is also limited by the lack of organized marketing facilities throughout the country. o A large number of infectious diseases such as respiratory and intestinal infections remain responsible for up to 50% of deaths of children under five, with malnutrition being an aggravating factor especially in the most populated areas.

Technological Analysis: •

Agriculture – Products: cotton, wheat, rice, sugarcane, fruits, vegetables; milk, beef, mutton, eggs

•

Industries: Textiles and apparel, food processing, pharmaceuticals, construction materials, paper products, fertilizer, shrimp

•

Industrial production growth rate: 10.7% (2005 EST.)

•

Electricity – production: 76.92 billion kWh (2003)

•

Current account balance: $-1.109 billion (2005 EST.)

•

Exports: $14.85 billion f.o.b. (2005 EST.)

Economic Factors: •

GDP : USD 1560 per capita

•

GDP growth: 1%

•

Unemployment rate: 6%

•

Inflation rate: 10%

•

Consumer confidence Level in Nestle: High

•

Inventory levels Tingle your taste buds with Nestle Fruit Yogurt

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Currency exchange rates: Pak Rupee 62 = 1 USD,

•

Trade: USD 129 per capita or 33% of GDP

•

Trading partners: United States, Japan, Kuwait, Denmark, Middle East, Great Britain

•

Balance of payments: deficit 2.197 Billion USD

Ecological Analysis: •

Climate: mostly hot, dry desert; temperate in northwest; arctic in north

•

Natural hazards: frequent earthquakes, occasionally severe especially in north and west; flooding along the Indus after heavy rains (July and August)

•

Environment – current issues: water pollution from raw sewage, industrial wastes, and agricultural runoff; limited natural fresh water resources; a majority of the population does not have access to potable water; deforestation; soil erosion; desertification

Political and Legal Analysis: •

Government : semi-presidential system

•

government debt : USD 38.8 billion

•

budget : deficit revenues: $15.45 billion-expenditures: $20.07 billion = -$ 4.62 billion

Education System •

Literacy: definition: age 15 and over can read and write

•

Total population: 48.7%

•

Male: 61.7%

•

Female: 35.2% (2004 EST.)

DISTRIBUTION ANALYSIS Nestlé has a proper distribution system for its each brand. This physical distribution process makes the product more convenient to buy. Nestlé carefully observes that the product arrives in good condition and fit the Tingle your taste buds with Nestle Fruit Yogurt

17 consumer’s need for convenience. For distribution process, Nestlé uses transportation method including 8 vans for each distribution category. Nestlé has divided its distribution process into following major categories: Category 1: Distribution of Powdered Products (i.e. Coffee, Everyday, Nesqick, Lactogen etc) Category 2: Distribution of Liquid items (i.e. Milkpak, Juices etc) Category 3: Distribution of Water (i.e. Nestlé Pure life) Category 4: Distribution of Chilled Dairy items (i.e. Nestle Milkpak Cream, Yogurt etc) For each category, the transportation system is separately designed. Each category is assigned with 8 vans and each van covers 2 areas. Furthermore, Nestlé has divided its areas in following four classes. Class A: It involves elite class areas like Defence, Gulberg, Model Town etc Class B: Areas adjacent to Mall road, Jail road etc Class C: Johar Town and Faisal Town are the major areas covered under this class. Class D: Narrowly focused areas.

Distribution Constraints Nestlé fruit yogurt faces a major distribution constraint that is the temperature norm of the product. Fruit yogurt requires a temperature of 2 to 4°C. Therefore, this chilled dairy product is delivered to retailers in special vans with comparatively low temperature. Another constraint faced by Nestlé is the availability of freezer/chillers in the stores. That’s why, the focus of area squeezes to few retailers who are earning Tingle your taste buds with Nestle Fruit Yogurt

18 enough to fulfill the temperature norms of the product. Mostly retailers switch off their freezers as they close their stores. Load shedding is also one of the current issues faced by Nestlé.

Retailer Incentives The major source of building trustworthy relationship with your retailers is to provide them incentives. The advantage that nestle provides to its retailers is the fact that nestle take’s back the stock that is not sold of by the retailer. This is the major advantage as the retailers are satisfied that the stock that isn’t being sold won’t be piled on. Thus it relieves the retailer of tension to worry about the stock not being sold.

Distribution Recommendations Nestle should increase its retailer incentives and should facilitate retailers. They should provide Nestle Freezers/chillers customized only for Nestle fruit yogurt so that the availability of Nestle Fruit Yogurt at convinent stores can be made possible.

TARGET MARKET The target market for nestle fruit yogurt are the young ones of age between 5 – 18 yrs. It is directed towards only the urban areas of Pakistan. It is specially offered for the upper & middle class, specifically the young ones are the main focus because this is more concerned with the health and nutrition. As yogurt is consumed in very large quantities in Pakistan, it can be predicted that the fruit/flavored yogurt will be seen in the same light with the added attraction of different flavors. It can be Nestlé’s future pillar brand. Due to lack of awareness, the target market is little in number but it will surely increase.

MARKETING INTERFACE PRODUCT

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19 Nestle fruit yogurt currently is being offered in 3 different flavors i.e. mango strawberry & peach in a 100g cup. Strawberry is the most popular among all the 3 flavors & is consumed more then the other two. In time nestle intends to add a few other flavors keeping in mind the increasing awareness. The fruit yogurt itself was brought into the Pakistani market by Nestle itself & still there is a lack of awareness about the product. However, still bearing in mind the limited promotion that is done on it & the lack of awareness of it in the market. Its rate of consumption is very much acceptable. The quality of the product is beyond a doubt very satisfactory & the chunks of the fruit in the yogurt add more value & taste to it.

PRICE The price of the fruit yogurt is 15 rupees/cup. Keeping in mind the flavors being offered the price is considered quite reasonable. The fact that Nestle replenishes its stock after 10 – 15 days if not sold at the retailers outlet is another added benefit, provided at this low a price. Besides this the great quality offered with chunks of fresh fruit in the yogurt proves beyond a doubt that it is worth its price.

PLACE Nestle is being distributed in only the major stores of the city (i.e. Alfatah, Tesmart & Shezan etc) it is not placed in every other retail outlet. However the placement is expected to grow with time. The barrier again to its bulk placement owes to the fact that the fruit yogurt needs a freezer to be stored and not every retailer in the city has one thus proving a hurdle in its placement. Therefore, out of 23,000 retailer outlets in Lahore Nestle Fruit Yogurt is distributed to 2,600 retailer outlets which is nearly 12% of the total retailer outlets.

PROMOTION Another major ‘P’ of marketing interface is promotion which is to be in the focus. Billboard is seen anywhere particularly of fruit yogurt. Only few posters are used for the sake of promotion. The fact that it is not being Tingle your taste buds with Nestle Fruit Yogurt

20 promoted heavily owes to the policies set by nestle i.e. the volume of sales determines how much they spend on its marketing & promotion activities. However, currently the fruit yogurt is not providing the company with large sums of profit which is causing limitation to its promotion. Therefore the more the profit the fruit yogurt generates from the market the more will be spent on its promotional campaigns.

STRATEGIC RECOMMENDATIONS PRODUCT This product is a value-added product as it contains fruit chunks in yogurt. Moreover, the benefits of yogurt make it a healthy and nutritious product. The result of research gathered from the survey is in favor of offering more flavors.

Addition of more flavors: Currently Nestle is offering three flavors that are: 1. Strawberry (Maximum sales generated) 2. Mango 3. Peach We are thinking to expand the product range by adding more variant in terms of flavors. They would be 1. Banana 2. Chocolate 3. Vanilla 4. Cherry 5. Mixed Fruit Usually these flavors are liked by majority. By adding more flavors market range would increase and the yogurt would become more appealing and variation in different dishes and daily routine.

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More uses different recipes like desserts Our main focus would be on increasing the uses of this fruit yogurt because this will give us sustainable advantage. And it would no more be used as a snack but become an essential ingredient of some very important dishes.

PRICE AND PACKAGING Price: We believe that the price is quite justified and provides value for money.

Resizing of the pack: We thought that the basic factor behind the failure of the Nestle yogurt was its size (100g). According to our survey of middle aged housewives from middle and upper classes and we found out that the basic drawback was its small quantity. This was mainly due to the fact that the children were not satisfied after eating the yogurt. They still felt hungry and asked for more which results in final dissatisfaction of the mothers which results in less purchase of the product as there are other snacks which fulfill the children’s needs such as indirect competitors like ice cream, chips like Slanty etc. In order to prevent that and expand our target audience we have decided to increase the size from one to three which are as following: • 100g Rs.15 • 250g Rs.25 • 500g Rs.45

PEOPLE Different Target Market: Along with the resizing of the product, we also recommend to change the target market. The target market consists of target consumer.

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Target Consumers: We are changing our target consumers from average age women to the whole family which includes kids, teenagers, mothers and fathers. We have shifted the focus from kids to the whole family which would result in increased sales of the product resulting from more household consumption. Teenagers would prefer to eat flavored yogurt instead of the same old yogurt. For old age people, it is highly beneficial for their health as it lowers the cholesterol level and strengthens their bones.

PROMOTION We will be promoting nestle fruit yogurt through the following channels: • TV program • Kiosks • Advertisement in magazines, newspapers and television • Billboards • Banners

TV Program Daily 5 minute TV program @ 8:30 pm We will be broadcasting recipe program in order to promote fruit yogurt and to increase uses. We will be telling different recipes in which we will use fruit yogurt. These recipes will be according to our culture as this factor will help us to start thinking about dishes in which they can use fruit yogurt. We selected that time as we believe that this the time at which most of the households ladies watch Television. And as also these dishes will be quick to make and at 8:30 mostly families are thinking about dinner so that’s the best time to promote Nestle fruit yogurt in dishes.

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Kiosks The kiosks are going to be performing two activities simultaneously one is that of offers and the other of providing related information. New Offers via Kiosks: •

The first offer is reduced price on 100g pack

That discount attracts them enough to taste the product and develop repeated purchase and to buy it for their families as well. The offer is as follows: 100g Rs.15 @ 33% discount = Rs.10 •

The second offer is a recipe with a pack

The second offer lets the customers discover the alternative uses of the product. For that we are providing the customers with a recipe so as to increase sales. This might just as well result in habitual buying if the recipe turns out to be really good. 1 recipe with one 500g pack Health and Nutrition Information via Kiosks: We will be giving information regarding different things such as • Fruit yogurt addition in your daily life We would tell people about the different benefits the yogurt gives you by adding it in your daily life such as 1.

Reduces Gastric problems: Yogurt with active cultures may help

certain

gastrointestinal

conditions,

including

lactose

intolerance,

constipation, diarrhea, colon cancer, and inflammatory bowel diseases. The benefits are thought to be due to changes in the microflora of the gut,

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24 the time food takes to go through the bowel and enhancement of the body’s immune system. 2.

Protection against Ulcers: Specific strains of Lactobacillus

acidophilus may protect against stomach ulcers by suppressing the growth of Helicobacter pylori, a known ulcer-inducing bacteria.

3.

Cholesterol Lowering: The blood cholesterol lowering effect of

fermented milk was demonstrated more than 30 years ago. In a study of older adults, intake of about 1 cup of yogurt with live cultures per day for one year prevented an increase in blood total and low-density lipoprotein (LDL) cholesterol levels.

4.

Anti-Cancer Effects: The possibility that lactic acid bacteria in

cultured dairy foods may protect against certain cancers such as colorectal cancer, and possibly breast cancer, has been investigated.

5.

Enhanced Immunity: Intake of yogurt may improve some of the

body’s immune defense responses. When adults consumed 1 cup of yogurt with live cultures per day for one year, allergic symptoms decreased. Further studies are necessary to confirm this beneficial effect of yogurt on the immune system.

•

The nutrients in yogurt and their benefits

We will tell seven different benefits of yogurt related to its nutrients and why to enjoy yogurt. These would be as follows:

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25 1.

Be Fit: Yogurt contains calcium, which can help with

weight management. 2.

Be Vital: Yogurt is a good source of protein for

muscle maintenance. 3.

Be Comfortable: Yogurt has active cultures that help

milk digestion. 4.

Be Strong: Yogurt has calcium, essential for strong

bones. 5.

Be Nourished: Yogurt contains important nutrients for

children’s growth. 6.

Be Proactive: Yogurt provides friendly bacteria for

your digestive tract. 7.

Be Happy: Yogurt is a great-tasting and satisfying

part of your healthy diet.

Kiosks Points: • Alfatah • Pace • Al-Hafeez Tower • HKB Y-Block Defence • On Mall Road near pizza hut We have selected these particular areas because our target market i.e. middle and upper class families visit these areas quite often. The traffic in these particular areas is relatively high. The people visiting such shopping malls have a tendency towards impulse purchase as a matter of fact a survey shows that most of our purchases are a result of impulse buying behavior.

Billboards The strategy for billboards display would be to put them on the most seen areas of Lahore. The locations that have been chosen by us are the most Tingle your taste buds with Nestle Fruit Yogurt

26 prominent locations of Lahore. The campaign is going to last four months at least so the calculations are as follows. The areas that our billboards are going to be displayed directly target the target audience that we want to convey our message to. And in places like Liberty and Mall are shopping headquarters for Women which are our target audience. This way we might just encourage a spontaneous urge for the purchase of our product among our target audience. •

Liberty Square rent for Billboard 1 (Rs.300,000/month)

•

Defense Road rent for Billboard 2 (Rs.150,000/month)

•

Jail Road rent for Billboard 3 (Rs.80,000/month)

•

Gymkhana rent Billboard 4 (Rs.65,000/month)

•

Lower Mall Road rent for Billboard 5 (Rs.42,000/month)

Expenditure on Billboards

Billboard 1 Billboard 2 Billboard 3 Billboard 4 Billboard 5 Total

Printing Cost 250,000 400,000 100,000 120,000 50,000 920,000

Rent for 4 months 300,000(4) 150,000(4) 80,000(4) 65,000(4) 42,000(4) 2,548,000

Total Campaign Cost = Rs. 3,468,000

Banners The banners are going to be displayed on the busiest main roads of Lahore. Jail road for one is known for the amount of heavy traffic that it has because of the hospitals, colleges, offices etc. Mall road is the shopping destination for many people of Lahore. The social class decreases from upper mall to lower mall. Gymkhana is a major attraction for many elite of Lahore on upper mall and HKB a destination for many shoppers on lower mall. We will be displaying 30 banners on Jail Road and 45 Banners on Mall road. Expenditure on Banners

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27

Jail Road Mall Road Total

Printing Cost x Quantity 5,000(30) 5,000(45) 375,000

Expenses for 4 months 600,000 900,000 1,500,000

Total Campaign Cost = Rs. 1,500,000

Magazine Ads Those magazines that target our target market will the best selection. The magazines that have been chosen are directed towards mothers, the magazines are such that are mostly read by married educated mothers. And along with that Young Times directed towards children. For targeting young girls, Pink would be the best option as many health issues are discussed in it. These magazines target our target audience as well as our target consumers and this campaign is going to run for 4 months. The feminine magazines specifically focus on the issues of women. Aurora Targets the people that are in the corporate world, the big position holders in companies. Most of the people who read aurora are middle aged so they need to take special care of their diet. In this manner we would be focusing on almost all of our target market except the women who don’t read English magazines. For them we have a lot of our other strategies. Expenditure on Magazine Ads

She Magazine Young times Pink Aurora

Printing Cost 15,000 9,500 6,000 8,500

Expenses for 6 months 75,000 190,000 125,000 165,000

Total

39,000

555,000

Total Expenses = Rs. 555,000

Newspapers Ads The newspapers that we are targeting are Dawn and Jung. Dawn is read by the well read middle and upper class people who are our target audience. Dawn would be attracting teens as well because it is read by youngsters and school Tingle your taste buds with Nestle Fruit Yogurt

28 going people as well. Jung is going to be focusing that middle and upper middle segment that are in a habit of reading Urdu newspaper. Along with that Jung might just as well give us another edge i.e. it is also read by many other segments which are not our direct target market but this campaign would also cause them to do a little bit of purchasing as well thus increasing our sales. The sales that would be a result of Jung are therefore difficult to forecast but seeing the previous effectiveness and trends it is however possible to have a realistic estimate which would be close to the actual sales. The forecast would be done on three levels i.e. minimum, maximum and mid level. The minimum level would indicate the minimum sales we expect as a result of this campaign so as not to incur loss, the maximum level would indicate our potential sales and middle level will indicate the level of sales that this campaign should generate on the average. This campaign would last for 6 months from the date of its launch. Expenditure on Newspaper Ads

Dawn (Sunday Edition) Jung (Sunday Editions) Total

Printing Cost 18,000 24,000 42,000

Expenses for 6 months 432,000 576,000 1,008,000

Total Expenses = Rs. 1,008,000

Advertisement The TV ads are going run during the family drama hours. It’s a family product and females are very much into watching dramas so therefore during dramas Nestle Yogurt’s ad is going to run. The ads are especially going to run during Sunday dramas as it is a holiday and the whole family is in the TV lounge watching dramas. An average Pakistani watches 6 hours of TV daily so it is very crucial for us to run ads on TV. The choice of the channels is based on the attribute of showing family shows i.e. these channels are family entertainment channels. The campaign is going to run for a half year i.e. 6 months and 8 times in between 7 to 11 pm.

Tingle your taste buds with Nestle Fruit Yogurt

29 Expenditure on Advertisement Expenses for 10 sec

Expenses for 6 months

ARY digital Hum Wikkid Plus Aaj TV

4,000(180) (8) 3,200(180) (8) 2,800(180) (8) 3,500(180) (8)

(8 times/day) 5,760,000 4,608,000 4,032,000 5,040,000

Total

12,500

19,440,000

Total Expenses on Advertisement = Rs. 19,440,000 Concept of Commercial: The TV ad begins with the scenario in which a family including father and two young kids sitting on dinning table waiting for their meal in a conventional style say to their mother, “Mom, we are hungry, where is the food?”. Mother appears with a dish of rice and a bowl of yogurt. Kids reply, “Are you with the same recipe today?” and make sad faces. They start having their meal and also watching an old movie on the television. Father observing his family suddenly says “I have something new for you” and switches the movie channel to another channel in which people are dancing, enjoying and having fun. As the camera focus on the family, the scenario is entirely changed. Their getup is changed and they are having fruit yogurt. In the end father says, “Like us, change your lifestyle and tingle your taste buds with Nestle Fruit Yogurt.” Ad Broadcasting Strategy: Advertisement should be broadcasted on those timings in the family is watching TV. The ad broadcasting strategy is obviously to give ads when our target market is in front of the TV. This time is during the peak hours when females are mostly watching TV and many times the whole family is watching the dramas. We have chosen this time because mostly the females are engaged in TV watching activities. They are free from cooking meals, washing clothes and all the other stuff that they do.

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MONITORING AND REVIEWING For monitoring and reviewing the strategies recommended should proceed with following outline. •

Taking feedback from the workforce to get the information the changes

occur in the current scenario. •

Analyzing the data of the sales after the plan has been implemented.

•

Taking

feedback

from

the

different

retailers

about

the

increase/decrease in the demand. •

After

2

months

of

the

implementation

of

the

strategic

recommendations, we can conduct a consumer survey to get the acknowledgement.

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Locations for Billboard:

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REFERENCES/APPENDICES •

The introduction and history of nestle is gathered from nestle website

www.nestle.com and www.wrightreports.com.pk •

General information about yogurt

www.wikipedia.com and www.webmd.com

Tingle your taste buds with Nestle Fruit Yogurt