Nestle Australia Is Food And Drink Products Supplier Marketing Essay

come near Australia Is Food And Drink Products Supplier Marketing Essay1- IntroductionLaunched in 1867, nuzzle Australia Ltd is a provider of aliment and throw outputs. It to a fault provides a wide range of dairy farm milk products, noodles in umpteen flavors, chocolate, set meals and coffees. Besides, it provides a variety of cold and hot drinks, light ice-creams and a variety of confecti one(a)ry and bakery items. Nowadays, cling to Australia offers catering services to cafes, restaurants, hotels and clubs. Other products that we depart put a spot-on in this report ar yogurts, crop yogurts, and flavored milk and yogurts. Nestls inciters include Kit Kat, Nescafe, Nestea, Ortega and Crunch. hold close provides also pets foods such as Purina. The company ensnareed a joint venture with General Mills in to a greater extent than 80 countries. (One ancestry, 2009)HistoryAt the beginning Henri nest has developed milk for babies who are unable to drink and to feed from t heir mformer(a)s, after five eld this product was sold around the world as a food for babies and old people. In 1906, Australian foodstuff became the second largest market for Nestle and was served by many of retailers and gross sales agents. The best contactment in Australian market was in 1934 by the invention of crudely product MILO. (Nestle, 2009) Nowadays, this product is sold in more than 30 countries with sales of more than half jillion Australian dollar. In 1999, Nestls head office in Sydney became the headquarter for Oceania region which includes Australia, New Zealand and Pacific islands.Principles and setIn the whole life of Nestle (135 years), Nestls basic approach to business was the foundation and the aid of long term localize for consumers, touchholders, employees, society and community as a whole. Nestls major headland is to maintain a long term business improvement and development. (Nestle, 2009). Nestles major ranges are the quest Long term developme nt Long term relationships Integration and reacting with different cultures The identification that customers earn training about the company besides the product that they bought Ethical values are basic requirements for our employees and senior farm animal managersThese values and principles have been translated into more than forty languages around the world, and it is must that any Nestles mangers should recognize and apply these values in their career lives, and these values are progressn by training to the vernal employees.Nestle AustraliaNestle also is participating in the Oceanias community which is identified by its mixture and diversity of stinting presumptions, cultures, look ats and tastes. We became a vital part in the community in which we activate as an employer and as a supplier to the local area. Besides, we were the leaders in many issues such as people wellness and environsal protection. As the largest food and beverage company in the world, we believe that we have a responsibility to customers and we are winning this responsibility seriously. We believe that people should live in a hearty style by doing sports, we are sponsoring many sports all the samets and we are always encouraging people to get active. In addition, through our agreement with the Australian Institute of Sport, we are improving children to get their knowledge and to understand nutrition.Mission StatementWhen you read Nestles bearing statement the following words jump to your mind question, good food, health and wellness. Our products wedge shapemit to consumers the best tastes and pleasures. Research is the masterpiece of Nestles heritage and an valuable element for our companys future. We still know that there is both(prenominal) mysterious discipline about health and wellness had not been discovered yet, that is the reason that we are still searching for answers to bring satisfactory Food for Good life. (Research. Nestle, 2009).Nestle WorldwideToday, w ith more than 480 factories and 265,000 employees in 87 countries in entirely over the world Americas, Africa, Middle East, Europe and Australasia, Nestle is considered as the largest food and Beverage Company all over the world. Nestle Oceania in Australia, New Zealand and the pacific island is hiring more than 5,500 employees, with more than 20 factories and four dispersion centers owned and managed by the company. collectible to Nestls multinational reputation, and despite the tough market conditions not however in Australia solely worldwide, and out-of-pocket to Nestls convenient place in Sydney and due to the uplifted suffice employees and the brilliant companys st rungy, Nestle dad been ranked number one among all food suppliers in Australian market in 2008 (Nielsen Report, 2008). In 2008, for Ice-cream, yoghurt and coffees categories, Nestls sales volume was more than AU$200m for for each one category.5% Employees Turnover paceMore than 6,000 Brands and 10,000 Products More than 480 Factories in 87 CountriesOver than 265,000 EmployeesAnnual gross revenue more than 103 A$ billionWorld Leading Food and Beverage CompanyNestle go out1, Nestle Worldwide. Source Nestle, Australia, 2009.2- Situation Analysis2.1- Internal AnalysisNestle Australia is considering the market leader in food and beverage sector in Australian market with boilers suit sales more than , involved in more than 20 industries such as Chocolates, yoghurts, ice cream, milk, dairy deserts coffee , confectionery and frozen meals. Nestle Australia has puted more than one hundred cracks Coffee Mate, Nescafe, Uncle Tobys, Nesquik, Maggi, Drumstick, Quality Street and Peters are just examples of Nestls brands in Australian market. Referring to Nielsons 2008 report, Nestle was ranking high among its competitors in ice cream, milk and yogurt handle which could be a actually good indicator for intromission our new product that we resulting treat later in our marketing curriculum.Refe rring to the Retail Australias 2009 grocery magazine we volition acquire the followingFor Chilled daybook category, Nestle value address was about 14.2% in 2008 study by 16.8% for the previous year.For Dairy Desserts Category, Nestle value share was 25.2% examine by 25.3% for the previous yearFor Chilled Diary category, Nestle value share was about 14.2% in 2008 comparing by 16.8% for the previous year.For Yoghurt category, Nestle value share was 11.8% in 2008 comparing by 15.8% for the year preceding(prenominal).For Drinking Yoghurt, Nestle is not involved in this market yet, only the following companies are in this market Yakult, Jalna , Bulla and some other small companies.As an overall line, we could realize some declination for Nestls volume trend in some industries and categories. This decrease was a natural impact of the extensive affect of the global financial crisis as we allow for describe in the abutting chapter .Due to this crisis, customers might buy some pr oducts instead of Nestls ones or they might even cut their purchases for some items.2.2- Macro Environmental Analysis (PEST Analysis)Economic later several years of flourish and high economic harvest-time, The Australian economy suffered a lot in 2008, due to the huge effects of the economic global financial crisis. Australians GDP is declined a reduction in job vacancies and a high rate of inflation, all these indicators could lead to an increasing in food and beverages chargesSee figures 2 3 for Australias GDP and Unemployment Rate in 2007, 2008 and Jun 2009.(GDP growth reached 2.7% in Jun 2008 comparing by 4.3% in Jun 2007)Figure2 Australias Unemployment Rate- Source ABS, 2009Figure3 Australias GDP Growth rate- Source ABS, 2009SocialDespite the lack of confidence for Australian consumers, Australia becomes one of the approximately optimistic countries, as in 2008, Australia was ranking as one of the most confident countries all over the world with an index punctuate 104, 20 points higher than the world average.. (Nielsen, 2008). Generally Retail growth in 2008, 2009 stays slow, and consumers became more cautiously with their capital, they spend more money for dining at- home like buying foods and drinks from supermarkets and they spend slight money for out of home activities like cafes, restaurant and take-away shops. Despite the fact that supermarkets gained a good share with this new customers philosophy, total grocery sales have been declined in 2008. (Nielsen, 2008). The total retail sales growth reached 5.9% in august 2008 comparing by 7.5% for the same month in 2007.Comparing by 2007, the businesses such as cafes restaurants and takeawayFoods, had recorded the largest drop in turnover of 6.4%.One expectation of these supermarkets is Aldi. Customers preferred to go to Aldi due to the good monetary values in addition to the good quality there. Aldi, with share reaching more than 22% , had took many dollars away from huge drawing string supermar kets.PoliticsThis part indicates legal and political situation in Australia. It includes Taxation for raw materials bought overseas, employment laws, environmental regulations, political stability and competition regulations. . In my opinion, no other politics issues would affect the launching of our new product due to the currently stable politic situation that Australia is facing now, i.e. there is no war, no revolution or even no elections are bear on Australia at this momentTechnologicalBesides the innovation and application of new technology such as the RFID (The Radio Frequency Identification) , the increment in price of raw materials and other supply chain cost could affect the launching of our new product.2.3 Micro AnalysisThe MarketIf we take an overall view on grocery market utmost year. Referring to the 2008 Nielsen report we will realize these important following items-An overall declining trend in grocery market, with sales growth 5.9% comparing by 7.5% as we mentio ned before, which is a normal consequences due to the new situation consumers tightening their belts-.Drinks and confectionery are only the twain sectors that have achieved an amplify in growth for 2008, with 3.3% and 7.5% respectively.-The largest growth achieved was in dairy sector by increasing more than 7.6%.The most important sector in this report is the Chilled Diary , since our new product( which we will discuss it in this chapter) is a sub category for the Chilled Diary part.In 2008, and despite the financial crisis, this sector achieved an AU$996.5m grocery value with an increase of 3.5% comparing by 2007. This indicator could be a high motivation for Nestle to increase its market share in this category (See Figure 4 5)Figures 4 5 Australias Chilled Diary Market bodily % Shares for 2008 2007 . Source Australias grocery magazine, 2009.Referring to the above selective information, we could recognize that there is a large advantage for Nestle to increase the profit by inv esting in confectionery or drinks sectors, especially in dairies products.The ProductOur new product would be categorized under the Drinking Yoghurts category.(We will discuss the product briefly in the next two chapters).The Drinking Yoghurts value market in 2008 reached a A$52.3m with an increase of 5.5% comparing by 2007. This market contains only 3 major companiesYakult with 67.7% value share (The market leader in this category)Jalna with 10.6% value shareBulla with 4% value shareAnd Private Label with 16.8% value share.Figure 7, Australias Drinking Yoghurt Market Corporate % Shares 2008Source Australias grocery magazine, 2009After all the above reasons, we could bring to an end that there is a big opportunity for Nestle to enter this market and it would obtain a very free-enterprise(a) position among the other competitors.Target Market and Market SizeIn this market visualise we will focus on children, youths and adults which are the majority of Australian commonwealth. We w ill bear on two genders male and female and our market will be in the whole Australia and not in a specific city.Australias population at the beginning of 2009 was 21,644,000 persons.The children aged population (0-14 years) was about 19.8% of the total population and the work age population was about 67.4% (15-64 years) of the total population. (OECD Fact book, 2008). However, in our market plan, we will exclude the 0-4 and 40-65 years population which means that we will try to attract from 50-60% of Australias population. Undoubtedly, some of the 40-65 years population would use our product. However, they will not be potential customers as the mentioned ones.2.4. S.W.O.T. Analysis-StrengthsMarket Leader in the manufacturingGood quality image and high brand awarenessA high growth rate in the desired marketA huge product linesParent SupportAn international team running(a) behind the plans achievementA very-well trained employees in all companys departmentA supply chain manageme nt to serve the whole countryWeaknessNew market forNestleUnstable economic conditions turn away in GDP growth rate and high inflation and unemployment rate.Customers are tightening their beltsExciting competitorsOpportunitiesA huge market sizeAn identified target marketNo large multinational size competitors gain in sales and profitsIncrease in total Australias market shareIncrease in product lineAn opportunity to export the product to many countries around the worldThreatsSegments are shared by competitorsUncertain circumstances could affect our salesMisunderstanding of the productPoor announce campaign due to the market conditionsAn unexpected drop in the confectionery and drinks markets.3-Product LaunchThe product launch is the most important part of this market plan.As we discussed in the previous chapter, we are going to launch a drinking yoghurt product. So why did we choose this product specifically?If we take a quick view on Nestle share value in yoghurt and chilled diary industry we would realize the followingIn Chilled Diary category, Nestle value share was about 14.2% in 2008 comparing by 16.8% for the previous year.In Yoghurt category, Nestle value share was 11.8% in 2008 comparing by 15.8% for the year above.It is very easy to recognize that Nestle is facing a problem in these above sectors for the last year. We all know that all companies now are facing financial problems and markets are volcanic and nowadays many customers are tightening their belts. However, these two markets had an increase in their value rate for the last year with 3.5% value increase for Chilled Diaries and 5.9% increase for yoghurt products comparing by 2007. (Australias Grocery Magazine, 2009)Also, referring to the Australias Grocery Magazine, some of Nestls competitors such as Diary framers had achieved an increase in value shareAccording to the above, Nestle is facing a small problem in this market, so how to solve this problem? The answer is including many possibili ties. We could reduce our prices, we could increase our market share by an increase in production, and we could modify our publicizing and advancement activities. In addition, there is another plan. We could enlarge our share in Chilled Diary category by launching a new product in a subcategory which is the Drinking Yoghurts. If we achieve this plan we could gain a higher market share, increase our sales and profits, enter a new market segment and finally we will gain new customers.The Drinking Yoghurt market is facing a good condition these days by an increasing 5.5% in value share in 2008 with a grocery value reached more than AU$50m , which means that this market is gaining new customers day by day and despite the wonky market situation, the drinking yoghurt market is in a developing trend.Nestle is already producing chilled diaries, yoghurts and fruit yoghurts so many product lines are ready for the launching of the new product. Also, Nestle is already gaining a high-ranking in the grocery market, therefore all shipping, transportation, supply chain, deliver products to supermarkets could be handled easily.Yoogo would be the brand name of our new product. We will launch the product at the beginning with three flavors Yoogo Mango, Yoogo Strawberry and Yoogo Apricot. After three years of market and sales observation, we will launch a new Light Yoogo, which will be Fat Free drinking yoghurt for people who care more about their health and lifestyle.Yoogos ingredients could contain the followingMilk, Skim Milk, Fruit Preparation mango or strawberry or apricot, and clear flavors and colors.Undoubtedly, Yoogo would instance a high competition when it enters the market. ( We will discuss this later in the next two chapters). However , the main competitive brands would be yakult with 67.7% and Jalna with only 10.6% value shares in 2008. (Australias Grocery magazine, 2008). However, Nestle could cause the product and gain a high position among these brands. ( We will discuss this later in the next two chapters).4-Market StrategyMarket air division, Targeting and PositioningTo gain a desirable position among all competitors in customers minds, we will segment our market on two bases-Demographic Segmentation Geographic SegmentationDemographic SegmentationWe are targeting customers depending on their ages. As we mentioned before, we will focus on children, youths and adults which are the majority of Australian population, we will exclude the 0-4 and 40-65 years population which means that we will try to attract from 50-60% of Australias population. This is a very huge segment as we are foc utilise on more than half of the countrys population.Furthermore, we believe that any of these metameric people, with any sex, income, occupation would use our product as it is not a luxury product using by specific customers.Undoubtedly, we will vary our advertising campaign for each generation, i.e. the advertising campaign for children will be differe nt than the youths one. Otherwise, we will make a small bottle for children (cl ml) and a large one for adults (300ml).Geographic SegmentationWe will divide Australia as geographically basis to zones and each distributor would be responsible for each zone. E.g. We will divide Australia to five zones Vic, NSW, WA, SA and QueenslandEach company when launching a new product desires a high profit margin, large sales volume, high growth rate. However, we will concentrate more in achieving a long-run high profit and sales instead of the short-run ones.We believe that there are some requirements for effective segmentationMeasurability, Accessibility, Substantiality and Actionability. (Kotler et al, 2007) Our team will work unverbalised to mate all of these requirementsWe consider that we will face a huge competition and we will face also the threat of substitute products. However, we will do our best to cover our market targeting by level best three years and to be the market leader for this category in maximum five years. Our plan is to gain more than 55% of supermarket shelves in five years. We realize that this is a very hard mission, but we will try to achieve it by three main stepsUnderstanding our marketing segments-Maintaining an advertising and promotion plans--Launching Yoogo with a reasonable price according to the company and according to our consumers.(we will discuss the price part later in Marketing Mix Strategy)Also, we will try to gain a competitive position in customers minds based on the following two conceptsNestle Family BrandThe Nestle family brand is showing care and safety to consumers and this is a very good reason to attract the customer.CommunicationDue to Nestls brand name, it is very easy to be in touch.with our customers5-Marketing Mix strategyProductOur product is a Fruit drinking Yoghurt with three flavors Mango, Strawberry and Apricot. We will make two sizes, 150 and 300 ml. The gradients would be described as following Milk, Skim M ilk, Fruit Preparation mango or strawberry or apricot, and approved flavors and colors(We had discussed the product more briefly in chapter 3)PriceIn launching this product we could use one of these two pricing methods Cost- based pricing Calculating the price by adding a mark-up to the cost of the product. (Kotler et al, 2007) Going-rate pricing Calculating the price basis on competitors prices, with less fear to our cost or to the market demand. (Kotler et al, 2007)Value-based pricing Calculating the price basis on buyers perception of value, with less attention to the sellers cost. (Kotler et al, 2007).In Nestle, we use the cost-based pricing methodUnit cost = variable cost + (unit unyielding cost unit sales)Unit price= unit cost (1- desired return on sales)We determine our prices basis of the following objectivesProfitFor any company the most important issue is the profit earning, however, as we are launching a new product, we do believe that we will not gain a high profit margin at least for the first three yearsConsumer SatisfactionThe most essential factor when determining the price is our customers satisfaction towards our products and prices.PlaceWe will divide Australia to 5 zones Victoria, NSW, SA, WA, and Queensland. However, we will try to promote Yoogo every(prenominal)where, in every small and large city in Australia. Customers will find Yoogo in hypermarkets such as Coles, Woolworths and Aldi, in medium size supermarkets such as IGA and even in small supermarkets such as Seven Eleven. Customers would find Yoogo in cafes, restaurants, hotels cinemas and beaches. In addition, Yoogo is a healthy fruity drink, so you can find it also at hospitals. This plan is a little min hard to be achieved. However, with the well-established supply chain management in Nestle and with the very good relationships with suppliers, retailers and resellers, we could achieve this plan within maximum three years.PromotionPromotion is the activities that represent the value of the product and hike customers to buy it. In our marketing campaign and promotion we will tray to reach every body every where. We will do advertising campaigns in newspapers, radio, streets and television.Seeing that the slew research is the most widely method for collecting primary data, before launching the product we will perform a marketing survey research we will go to clubs, streets and schools. Also, we will implement an online marketing research to collect primary data through online focus groups, using the integration of animation such as audio, video and virtual environment would help us to overcome any limitations. We will try to select a sample of the population that has been selected, ask those questions about the product and the company and depending on the results of this research, we will implement our advertising campaign.We will indorse our promotion campaign basis on these four methodsA-Individual Selling In this campaign, we will implement a dir ect selling activity especially during the summer months of November, December, January and February. Our team will go to club and beaches to meet our target segments there, they will wear t-shirts and caps with Nestle and Yoogos logos, and they will sell our Yoogos 150 ml bottle. By applying this advanced(a) idea, we hope that our brand will get a great vision in terms of image, sales and brand awareness.B-Sales Promotion Besides personnel selling, we will implement some sales promotion plans. At the beginning of the product launching, we will go to streets and malls, we will offer free 150ml trial bottles to customers, we will move on them to try our product and to give us their feedback by email or even by phone. In addition, we will offer a 150ml bottle free with the purchasing of three 300ml bottles. Adding to this trade promotion, we will give the retailer an addition discount 5% during our sales promotion. Our marketing team will implement a major healthy and education camp aign about the importance of the product, our team will focus on the concept that our product is a healthy one. Invitations would be sent to parents of school children to attend these seminars. This could help us to improve our brands image in consumers minds.C-Public Relations Public relation is one of the most important factors in all multinational companies promotions. Every year, Nestle is launching its annual report containing information for shareholders and stockholders. In addition, a large amount of information regarding our product and our promotion would be found in newsletters and magazines issued by Nestle Australia.This promotion would obviously lend a hand in formation of the awareness of our brand.