Marketing Objectives of Nestle Maggie

Nestle Maggie requires suitable marketing objectives for getting launched in the market of Japan (Weaver et al. 2016). The first criterion of a marketing plan is to analyze the potential customers of the target market. According to recent reports, the future of pasta and noodles in Japan seems quite promising.

From the above data, it is clear that consumer preferences have drastically changed in the modern environment, and the consumers have shown reasonable interest in pasta and noodles. The volume of consumption has increased massively in the range of 10 years, starting from 2008 to 2018. This will help Nestle Maggie identify the market dynamics to launch their product in the market of Japan.

Through extensive market research, the company should build up its market segmentation strategy based on heterogeneous factors of Japanese consumers. Based on geography, the Japanese market can be divided into cities and regions (Baxi et al. 2016). Based on demography, consumers can be segmented through age, gender, income, lifestyle, and values. Similarly, the behavioral patterns explore the buying behavior, usage occasions, while the psychographic segment includes the interests, attitudes, and traits.

Considering all the above factors of the target market and the consumers, small, measurable, and achievable marketing objectives can be set up for Nestle Maggie.

1. Achieve at least a 10% growth in sales in the next quarter by earning a higher percentage of deals.
2. Increase customer value through the enhancement of the quality of products.
3. Reduce at least 5% of lost deals by invigilating the reasons behind such lost deals.
4. Increasing the total number of outlets globally through the inauguration of new outlets in the market of Japan (Vilceanu et al. 2019). Most of the outlets will be opened in areas where the density of population is high, and demand for pasta and noodles is also substantially high.
5. Improve the process of the supply chain through better deals with the suppliers and the retailers such that the consumers can enjoy quick delivery of the product at their doorstep (Ahmed 2016).
6. Increase the gross profit by at least 5% in the next quarter, especially in the online retail platform.

Distribution Strategy of Nestle Maggie

A distribution strategy is essential for making the product available to the customers. Maggi can follow the distribution channel of its parent brand, that is, Nestle, for creating a platform for the proper distribution of its products. The process of distribution should follow a twofold pathway. The product should be made available to all the local stores, especially in targeted areas where the availability of the products will be quite high (Cong et al. 2018). Following another pathway, the company can make the products available in various shopping malls and centers. All the distributors of the company get a commission of 6%, which is fixed. One of the disadvantages of this scheme is that the distributor is required to pay the price for the sold product in advance to the company, while the customers take it on credit. In the new market, the company can take measures to reduce the percentage of advance payment such that the distributors are not the sufferers in the process.

The retailer of the distribution channel can get a 15% commission on the promotional products, while the standard products can fetch him a 10% margin. In the target market, the company can continue its indirect distribution channel through the selection of a lump sum number of distributors and retailers. Maggie can follow two essential elements of customer preferences in the Japanese market, that is, convenience and easy availability. Keeping these two factors in mind, the company should make its products available in various online and offline retail outlets (Bharucha 2016). As the resources and capabilities of Nestle are considerably high, owing to its significant brand name and popularity, the company can use it to its advantage in the new market. Nestle can also set up its outlet and prepare an exclusive distribution strategy in such outlets. Variation in product flavors should also be introduced and placed correctly in areas according to the needs and preferences of the consumers. Market analysis might reveal variety in consumer choices regarding a particular flavor, and such products should be available in bulk in those specific areas.

Pricing Strategy of Nestle Maggie

Pricing is one of the most critical factors in the marketing mix of a product that is on the verge of being launched to a new market. This is because pricing determines the value that is proposed by the product to the consumers. Many strategies can be suitable for Nestle Maggie to capture the market of Japan with its products. Competitive based pricing strategy is one of the most crucial pricing strategies in this context. This is because the price information for the competitors of the industry is readily available (Imam 2016). Setting up a price higher than the competitor would be favorable for targeting a new customer base of the existing market. However, to capture a new market, the initial price must be kept low as compared to the local competitors. Under such conditions, the company can introduce attractive discounts, allowances, or offers such as “buy one, get one.” This will help in earning a significant market share in a short period and enhancing the number of customer bases for the products.

Figure 1: Competitor price table of Nestle Maggie

Nestle Maggie has the right brand name and large-scale popularity across a global platform. This will serve as an advantage for the company in tapping the Japanese market very conveniently. The company has been using a price penetration strategy in various markets on the global platform. This is because a price penetration strategy helps in quick penetration of the markets at the worldwide level. In the Japanese market, the company can encounter several direct and indirect competitors (Adefegha 2018). For minimizing the effect of the competitors, the company should lay down a clear-cut pricing policy. In the Japanese market, the company can adopt competitive pricing in certain cities, where the popularity of the brand is high, and the company would get sufficient customers for its products. In other regions, where most of the people belong to the average middle-income group, the company can keep a low pricing policy in its initial years.

In very few regions, the company can adopt psychological pricing, in which the product prices should be kept in such a way that consumers perceive them to be lower than the competitors (Cabon-Dhersin and Drouhin 2019). The company may not fluctuate the prices of the products but can reduce the quantity in due course of time for keeping pace with the economic conditions and high cost of raw materials.

Promotion Strategy of Nestle Maggie

The company can carry out many kinds of promotional activities for creating awareness among the consumers of the Japanese market. Before the formulation of an appropriate promotional plan, the company should clearly define its selling proposition, which should be distinctive from its competitors. In this selling proposition, the company should effectively articulate the need for its product and the reason for its superiority among all other available products in the market (Marino et al. 2016). As a good range of customers is quite familiar with the brand name, the company can develop a pull strategy for attracting the customers towards the offered product. In some of the regions, where the brand name has not been trendy, the company can adopt direct selling of its products and provide free samples to the consumers. In these regions, the company can also undertake high profile advertising, which is a suitable push strategy.

The company can also use other promotional alternatives to capture the attention of the customers. The selection of television as an advertising channel can help in fetching a large customer base as this promotional strategy is aimed towards capturing the mass market. The company can also use social media to display advertisements regarding its products. This will help in reaching a mass market in a cost-effective way. Social media will also provide a platform for interacting with the customers in a personalized way so that the marketers could easily explain the value proposed by the products (Yang and Nguyen 2019). In other markets, the company has initiated its product launch, by targeting a specific segment of the consumers, that is, the females and the kids. The company offered various packets of gifts to the children along with the packets of noodles. A similar technique can also be adopted for the Japanese market.

The company can move on with its most catchy tagline, which is “2-minute noodles”. This will help in gaining better responses from the consumers in Japan as in other parts of the world. Another significant method of promotion can be commercials featuring celebrities of Japan (Tasnim 2018). The advertisements should be made convincing so that the customers get attracted to the personality and buy the product out of affection. Banners, posters, and hoardings can also serve as suitable forms of offline promotion techniques.

References

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Bharucha, J., 2016. Cadbury Vs Nestle: A Study of The Chocolate War. International Journal of Research in Social Sciences, 6(9), pp.609-620.

Cabon-Dhersin, M.L. and Drouhin, N., 2019. A general model of price competition with soft capacity constraints. Economic Theory, pp.1-26.

Cong, M., Kilian, C., Wang, X., Wilson, S. and Yan, C., 2018. A Social Media Plan for the Changemakers’ Playground.

Imam, T., 2016. Exploring consumer attitude for Maggi seasoning among the low income segment in Dhaka.

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Tasnim, N., 2018. Brand activation: the process of door-to-door activity of Nestlé Bangladesh Limited (MAGGI Shad e Magic Masala).

Vilceanu, M.O., Grasso, O. and Johnson, K., 2019. Bridging the Gap Between Public Opinion Research and Consumer Marketing Research: Insights into US Shoppers of Organic Foods.

Weaver, R., Spring, K. and Trish, M., 2016. New Strategies for Aligning Libraries with Institutional Goals.

Yang, S.P. and Nguyen, T., 2019. Skewness Preference and Asset Pricing: Evidence from the Japanese Stock Market. Journal of Risk and Financial Management, 12(3), p.149.