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Nestle Case Study: How Nestle’s Marketing Strategy Helped Them Grow as a Brand-2023

How many of you can answer this?

What is one common thing among Nescafe, Caregrow, KitKat, and Maggi?

Any guesses?

Yes, they are world-renowned brands, are familiar names in every household, and are products you must have consumed in your life at one point.

Anything other than these?

Yes. All these belong to one and only Nestle.

Be it in the fresh smell of hot coffee, a short break, or a bowl of tasty noodles- we cannot deny that all of us have enjoyed the awesomeness of Nestle’s products.

The brand has come a long way, crossing so many hurdles and achieving success, and it keeps growing.

Today, nestle is a brand that everyone is familiar with and uses in their day-to-day life.

Curious to know how?

In this Nestle case study, we are discussing everything about Nestle company, the marketing mix of Nestle, nestle competitors in India, marketing sales promotion techniques of nestle, and much more.

Nestle owns more than 2000 brands, from global stars to local ones.

How did Nestle achieve this level of success?

The brand has been in the market for more than 150 years, but many companies got this opportunity but failed. Nestle survived.

What is the secret of Nestle’s success?

This Nestle case study shows you a glimpse of nestle strategy and what digital marketing and social media strategies they followed that led to achieving this success.

So, let’s start by understanding a bit more about Nestle as a company.

Nestle had come a long way from when it entered the market by selling infant food in the 1860s with a motto to reduce child mortality rates.

Gradually, it became a renowned name in the wellness, healthy food, and pet care industry with its evergreen tagline, “Good Food, Good Life.”

Now, you must be thinking that how did Nestle reach this position? How can a company build a legacy which is so powerful that it has stood still since its birth?

The answer to this may lie in Nestle’s digital marketing and functional strategy.

Nestle Case study: Introduction of Nestle company

Nestle is a world-renowned manufacturer of packaged foods and beverages. It is the world’s largest food manufacturer operating in more than 186 countries and with over 2000 product brands.

The brand came to India in 1956. Since that time, from selling its first milk product in the 1960s to selling a wide variety of Nestle products in India, Nestle has grown exponentially in India.

With such exponential growth, Nestle’s umbrella keeps widening day by day. They are not only the largest food and beverage company in the world but also one of the best companies that have effortlessly collaborated with the online world and achieved immense success.

Gradually, Nestle India started making its presence felt in the FMCG sector, and now the brand enjoys a good market share in the food and beverage industry.

Being the most extensive food and beverage brand in terms of revenue, the pricing strategy of Nestle company, along with its targeting and positioning system, has played a vital role in reaching the position where it is currently.

Let us find out how it has served the Indian market with its products and services.

Nestle offers products in breakfast cereals, beverages, dairy, chocolates, nutritious foods like vending, and food services.

Popular food products like Kit Kat, Maggi, Milkmaid, Polo, and Nescafe come under Nestle’s products sold in India.

For more than 150 years, this iconic brand has been applying its expertise in Health, Nutrition, and Wellness to help its customers, pets, and families live a healthier and happier life.

However, they believe what is good today might not be suitable for tomorrow.

So, they keep exploring and focusing on pushing the boundaries to find more to experiment with foods, nutrition, and beverages.

Nestle unlocks the power of food to improve the quality of life for everyone, not just today but for generations to come.

The brand focuses on bringing more pleasure and enjoyment to the customers, how they can enable better health, and how they can make the best nutrition affordable to everyone.

Not just these, but the brand tries new ways to protect and improve natural resources.

History & Founder

Nestle was founded in 1905 by the union of the Anglo-Swiss Milk Company, set up in 1866 by brothers Charles and George Page and Farine Lactee Henri Nestle, founded by Henri Nestle in 1866.

Nestle originated in 1860 when two separate Swiss enterprises later created Nestle.

In the following decades, the two rival companies grew their businesses throughout the United States and Europe.

In 1866, George Page and Charles Page, brothers from Lee County, Illinois, USA, formed the Anglo-Swiss Condensed Milk Company in Cham, Switzerland. The company’s British operation started in 1873 at Chippenham, Wiltshire.

It was during the First World War when the organization grew significantly, and again during the Second World War, the company increased its offerings beyond its initial condensed milk and infant food products.

Nestle Case Study : Facts & Figures

Here are a few interesting numbers about Nestle that sets it apart from others.

• Nestlé is the world’s largest food and beverage company.
• The brand has 276000 employees
• Nestle has acquired 30 companies

Nestle Case Study: Nestle competitors in India

Nestle has many major customer brands like Carnation, Kit Kat, Nestle-water, and Stouffers, among others.

Thirty of its brands netted more than $1 billion in earnings in the year 2010, which makes the company a vital force in the worldwide food and beverage industry.

With around 42 % of its sales being in North America, Nestle is one of the most geographically distinct companies in the food and beverage industry. It places it in a position that helps it edge over its competitors.

Its brands are well established in a considerable market share in leading economies like U.S. and Europe.

Danone and Unilever are important competitors for Nestle. These two are giants in the food and beverage industry, like Nestle.

In 2010, Unilever posted around 26% growth in yearly profits because of its accelerated sales in the food and beverage industry, especially ice cream, frozen food, tea-based beverages, and cooking products.

On the other hand, Danone stated around a 38 percent increase because of its improved share prices. In addition, a rise in its yogurt sales also enhanced the growth in earnings.

However, nestle handles positioned itself in the market by adopting a new accounting method which aided a decline in its cost of sales.

The company could also incorporate discounts, allowances, and promotions for its retailers through sales profits rather than the marketing line.

Though its sale was lesser for a year, nestle pricing strategy helped them match its peers, which in turn, made it a famous manufacturer even though the competition was so high.

Being the world’s most popular food manufacturer, nestle has intense competition with its rival company, Unilever.

Unilever has around 1,49,000 employees and operates in 160 countries, with its headquarters in London for food, home, and personal care.

The company is trying hard to beat Nestle in terms of the quality of their product, which has made Unilever the second company in the Western European ready meals market with a market share of around 8.6%, i.e., 0.3 points behind the iconic Nestle.

Nestle’s Target Audience and Products for Each Segment

The unique thing about Nestle is that it offers a wide range of products that covers audiences of different ages, from 2-year-old to working professionals.

Here’s a breakdown of Nestle’s Target Audience and the products meant for them.

• Target Audience
• Working Professionals
• General Audiences
• Koko Krunch, Caregrow, Lactogrow
• Sunrise, Nescafe
• Maggi, KitKat, Milkmaid

Everyone, especially coffee lovers, will know how Nescafe is a big hit among working professionals.

Nestle guarantees that Nescafe is the only coffee that would keep professionals fresh throughout the day, and who does not want to feel fresh?

Regarding kids, parents blindly trust the product “Caregrow” by Nestle. The product consists of cereals to keep young kids healthy.

However, nestle has several other products like KitKat, Milkmaid, and Maggi for the general audience.

It is how Nestle has designed something for everyone in India. In the coming section, we will dig into how Nestle has advertised itself and its products in the digital world.

Nestle’s Digital Marketing Strategies

By now, you must have understood that Nestle is the world’s largest food and beverage company in terms of revenue. So, it might be basic information for many of you.

But what if we say Nestle always tries to be one step ahead regarding marketing strategies and policies?

It has always focused on the most updated marketing ways no matter, whether it is digital marketing strategies or offline strategies.

Nestle’s marketing strategies will teach you to build marketing strategies that work and get a positive response from customers.

Let us start with Nestle’s Digital Marketing Strategies that must follow if they want to succeed as a brand.

Partner with influential celebrities

Nescafe, a product of Nestle, collaborates with celebrities to put forward their message and create more noise around their brand.

A few years ago, they announced Bollywood actress Disha Patani as their brand ambassador.

Recently, they launched a campaign with famous content creators called “Karne Se Hi Hona Hai,” which means “Only doing will make it happen.”

They created this campaign during the Covid Pandemic to inspire people and encourage them to keep working hard towards their dreams no matter their situation.

Through this campaign, they targeted the youth of India and asked them to dream, act, and achieve success.

• Run campaigns that foster connections and bring customers together

An ordinary 37-year-old guy named Arnaud, with 1,2000 Facebook friends, was challenged by the company to catch up with his friends over a cup of coffee.

So, he filmed these meetings and turned them into a 42-minute online video documentary. During the sessions, Arnaud enjoyed a cup of Nescafe with his pals.

The documentary was a big hit on social media. It got almost 8 million views on Facebook, around 63,050 likes, 4,850 comments, and 5,550 shares. 

The Facebook Page of Nescafe saw an increase in the number of fans by 400%.

Fans were excited by the documentary and wanted to know how to turn their online friendships into real-life relationships.

As a reaction, it created the “le Defi Nescafe,” a Facebook campaign to allow winners to reinvent the same experience.

More than 26,000 people applied, around 19,000 liked it, and nearly 1,725 shared.

Instantly, Nescafe became an online sensation by marketing itself as an item that stimulates connections and friendships.

2. Localization of Products

Localization is adapting an organization’s products to the local market. Nestle has gone huge on localization in various markets where it now manages.

For example, consider Japan, where the organization’s primary foray was through coffee-flavored chocolates.

Japan is traditionally a tea-drinking country, and the company established these candies so that kids could also get to know the taste of coffee.

Later, it introduced Nescafe and KitKat, and what happened is history.

3. Content Marketing

Nestle has created many video content on every brand’s YouTube channels. The content ranges from informative “how-to” videos to cooking tips to better insights on using the right products.

For example, the “Meri Maggi” has more than 530 videos with more than 5,71,000 subscribers.

Though video content is an expanding channel in Nestle’s marketing strategy, it has recognized other avenues to share relevant information with its consumers.

4. Out-of-Home Advertising

Nestle’s brands, including Maggi, Milo, KitKat, and Nescafe, use different ways to grab customers’ attention.

Whether benches, hoardings, or banners, Nestle’s brands have made it to the limelight for their contextuality and creativity.

What are the advantages of using OOH ads? First, most people correctly receive these ads. They are worth sharing.

People can take photos online, send them to their friends or relatives, and even marketers discuss them.

In addition, with the help of OTT, they can reach many people at a low cost.

Also, Nestle’s marketing strategies are exceptional and generate some customers.

5. Co-branding

Have you ever heard about Android KitKat?

A few years back, Google and Nestle united and invented an Android KitKat operating system.

Nestle was facing a new scandal with their pet product and wanted to capitalize on the image of Google. This movie created a buzz and surpassed the crisis.

Lately, nestle signed another deal with Starbucks to kill two different birds at a time.

First, the brand entered the new product development stage-i.e., roasted beans- and improved its brand by discovering a wide range of Starbucks Nespresso Capsules.

Did you understand how co-branding helped Nestle?

Co-branding is great for stepping into a new market and widening your reach. This marketing benefits startup that wants to create brand awareness or launch a new item.

It would help if you found companies that complement your products and collaborated with them to run co-branding promotional ads.

Nestle – Challenges Faced

Undoubtedly, Maggi was the most popular instant noodles brand in India. The brand had established its presence in India’s food industry, but suddenly it became controversial.

State food regulators stated that Maggi contains Monosodium Glutamate and lead above the recommended limits, which were dangerous, especially for kids.  

When nestle encountered lab results, it said that they had a world-class quality control procedure and that their products were safe for consumption.

Ultimately, the National Food Regulator FSSAI ordered to ban on the selling of Maggi, including product recall.

Consequently, various state governments imposed a temporary ban on selling Maggi noodles in a few states. As a result, the future of the company suddenly started looking dark.

Another acquisition of Nestle by the critics was they accused that the brand discouraged mothers from breastfeeding.

They showed that their baby formula is much healthier than breastfeeding, although they didn’t have any proof to support this.

It resulted in a boycott of Maggi for the first time after its launch in 1977 in the United States and slowly spread to Europe.

Several reports have acknowledged the widespread use of child labor in Cocoa production, slavery, and child trafficking, throughout the Western African plantations on which Nestle and other important chocolate companies depend.

As per the 2010 documentary, The Dark Side of Chocolate, the kids working are usually 12 to 15 years old. Nestle faced criticism from The Fair Labour Association for not properly checking.

Different Campaigns by Nestle 

• Ask Nestle Campaign

In this campaign, Nestle India launched a digital tool, NINA, which stands for Nestle India Nutrition Assistant on AskNestle, which used Artificial Intelligence to offer real-time nutritional information on the foods we consume.

In addition, it assisted Indian parents in designing a nutritious customized meal plan for their kids below 12.

This campaign by Nestle was India’s first artificially intelligent assistant that permits one to find nutritional information for kids.

So, this is how Nestle India set its foot on digital fronts and started driving organic traffic and improved overall engagement compared to competitors.

2. #WeMissYouToo Maggi Campaign

Maggi suffered a massive loss after it got banned as Maggi contained a high amount of Monosodium Glutamate (MSG) and lead content- more than what is allowed.

It was hard for them to hope for a comeback, but Maggi did their best and experienced huge sales. As a result, the price and volume of Maggi are now much more significant than before.

How did they do so?

They did so through their different marketing campaigns. One among them was the #WeMissYouToo campaign.

In addition, they published a few videos showing how people are kissing Maggi and how their life was better with Maggi.

Videos showed how Maggi has been a staple food for many and how its absence had affected their lives. 

In campaigns, characters addressed Maggi as “yaar” or a “close friend” who is always there for them when in need. 

Therefore, they considered Maggi’s return as a huge celebration that brought people’s life to normalcy.

3. A Campaign for kids: Poora Poshan Poori Tasalli

Nestle Caregrow started this campaign in 2019. The campaign targeted couples living in the cities who had kids between the age of 2 to 5 years.

India is where parents are very concerned about their child’s health and nutrition right from birth. Nestle kept this in mind and decided to portray this care through its campaign. 

The brand portrayed how Indian mothers worry about their kids’ proper nourishment.

The brand came up with a new product, Caregrow, which controls a child’s hunger and offers all the essential nutrients for enhancing the child’s immunity and overall development.

4. Celebrate the Breakers- KitKat campaign

Across the world, people consume around 12 billion KitKat chocolates every year.

It is one of Nestle’s most famous chocolate products available in India. The company also released “KitKat Senses, a premium “slow-whipped” chocolate.

Nestle sought to influence Instagram to support its “Celebrate the Breakers” campaign by raising awareness and message association among enthusiastic 15- to 34-year-old Instagram followers.

Nestle came up with a new worldwide advertising campaign that takes a different approach altogether with a famous slogan, “Enjoy a break, enjoy a KitKat.”

“Celebrate the Breakers” was a new idea that identified the different forms of breaks that generally “breakers” take.

The animated movies showed KitKat chocolates are the best for enjoying a break in life.

Instagram was the appropriate platform for Nestle to showcase this idea graphically.

The brand posted a series of pictures with the hashtag “# mybreak over seven weeks ,” showing how people enjoy different types of breaks, like sleeping at their workplace, enjoying a party, or listening to their favorite music.

The images of KitKat match efficiently with its customers, as Instagram is a place where people share their daily moments and experiences.

Future Plans of Nestle

Nestle planned to invest Rs. 5,000 crores in India in the coming 3 ½ years, as per Mark Schneider, the company’s CEO.

The FMCG company, which has nearly 2,000 brands across the globe, believes that this initiative will help Nestle to improve its core business in India and enjoy new growth opportunities.

It marks the brand’s most significant investment in India since the year it started manufacturing.

Nestle is renowned in food, nutrition, health, and wellness.

Its competitive strategies mainly focus on overseas direct investment in ready-to-eat, dairy, and other food businesses.

Though there is rising competition, Nestle has remained on top for a long.

It maintains its dominance by balancing sales between high-risk and low-risk nations.

Over the years, Nestle has proven itself as a leader in the food and beverage industry with product innovation and innovative marketing strategies.

It creates campaigns that are memorable, relatable, and share-worthy.

As it is moving toward developing a solid presence in the future, digital marketing will play an essential role in the future growth of Nestle.

As Nestle continues to follow its values, mission, vision, and purpose, it will continue to grow. 

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Marketing Environment of Nestle

In this research work the company chosen by me is Nestle Malaysia. I have tried to cover the brief history of the company, vision, mission and objectives of the company. This brief history and other sub heading under company background is compulsory to be understood and researched well as they form the basis for marketing plan of the company. We have also tried to cover the internal and external micro and macro environments for the company and country for its future growth and further marketing planning strategy. At the end we have proceeded to the 7 Ps of the marketing for Nestle.

Company Background

Today, Nestle is one of the leading Food and Nutrition Company in the world. Nestle has headquarters in Vesey, Switzerland. The business of nestle is supported by its strong network in more than 86 countries with more than 500 factories. Along with that the business also gets the benefit of its international R&D network. The Nestle factories are operating in the different countries of:

1. Asia 2. America

3.Africa 4. Europe 5. Oceania

As the company is in the sector of food and nutrition, it remains sensitive to Being a company dedicated to food from the beginning, Nestle remains sensitive to culinary and eating habits, and responds to specific nutritional problems, whilst also setting and matching new trends such as growing out-of-home consumption and caring about the wellbeing of its consumers.

Nestle aim is to become global leader in Food and Nutrition Company in the world and sustain that position. This objective of the company signifies that they need to work hard to stay ahead of Cadbury which is recently being acquired by Kraft food. Kraft is world leader in today’s chocolate business and food and nutrition business.

“Nestlé Norden’s aim is to meet the various needs of the consumer every day by marketing and selling food of a consistently high quality.” To achieve this vision Nestle has two steps to follow, first is High quality and collaboration, which is integral part of any food business to flourish and second is Focus on e-business and websites. Nestle has started investing heavy in development of e business and its promotion so as to capture clients in e business sphere also.

“Nestle is dedicated to providing the best foods to people throughout their day, throughout their lives, throughout the world. With our unique experience of anticipating consumers’ needs and creating solutions, Nestle contributes to your well-being and enhances your quality of life.” The mission statement of Nestle is well articulated and reflects the long term objective for doing the business. It has mentioned in the mission statement that the company will provide consistently the best food product with the best quality throughout the life of their customers, which will ultimately enhance the quality of the life of its customers. The mission statement put the emphasis on the presence of the company in nearly every country. It promises in its mission statement that the company will understand the need of its customers and provide the best products to fulfill the needs. The mission also shows the high quality which is maintained in the wide range of products of Nestle. The company reassures that they provide the best range of food products to remain the first preference of its consumers.

Internal and External Micro Environment

Internal Environment

Nestle has a rich working culture which motivates its employees to serve best to its customers with the help of the variety present in their product range. Nestle has included the benefits of the employees in the goal statement of the organization as the management of the company strongly believe that the productivity, quality and the dependability will reflect on the product only if the employees will take care of all these factors. Different departments of the company work to contribute in the growth of the organization and these departments not only keep the customer’s needs and demand in mind but also keep the same type of attention for the internal customers of Nestle. The company believes if the internal market of the company is fully satisfied than only the internal market will be able to serve to its customers and able to understand their needs and able to manufacture the products which can fulfill these needs. Nestle has a strong top management team which runs on strong values and principles of the company. The values of the company give strong focus to integrity, loyalty and team work. The efficient top management of the company is able to run finance, operation, marketing, logistics, sales, and research and development departments with great success which ultimately leads to the fulfillment of the goal of the organization.

Micro Environment The micro environment of Nestle includes three divisions:

a) Suppliers

Suppliers provide the raw material resources, unfinished goods and labors to the company in order to produce goods and services. The effectiveness of suppliers determines the efficiency of the company in terms of producing the goods. In addition to that the quality of the finished product has a strong with the suppliers of the firm especially in case of food products. As the presence of the company is in more than hundred companies, it is a challenge for the company to maintain its standard all over the world and provide the consistency to its customers in the taste and quality of the product.

Further we can divide the supplier of Nestle into two parts: Labor suppliers and material suppliers. Labor suppliers deal with the quantity of labor is required at the optimum level in order to prevent the loss of labor force and prevent the company from the shortage of labor which again can lead building of inventory as a cost for the company. The skills of labor is again maintained by the labor suppliers, wherein the labors of different skills are managed in such a way that the operation of the firm can run smoothly. Labor strikes and labor relations are other factors which we cannot ignore in the current scenario as the efficiency of the business depends largely on the factors like attrition and employee satisfaction. Material supplies handle all the material required by the firm in order to manufacture the finished product for sale. Nestle is in the food and quality markets and the quality of such item plays an major role in its success in the market. Nestle has maintained a high quality efficiency in handling the quality and quantity of the two different supplies i.e. labor supplies and material supplies and hence the company has been able to run its business smoothly for more than 100 years in spite of the different business trends in the world market.

b) Marketing Intermediaries

The market intermediaries of the company help to advertise, sell and distribute its product to the end customers. The physical distribution network of the company decides the medium by which the finished product is delivered to the end customer on time and with safety. This department also ensures the proper storage of the firm that prevents the product from getting any king of damage.

The marketing service department of the firm helps in the promotion of the product and acts as a communication channel between the company and customers. It not only communicates the features of the product to its customers but also get the feedback with the help of survey, which helps the research and development department to develop a product according to the need of the customers. The other intermediaries of the company like banks help to provide the funds to the companies and play an important role in the continuity of the business. Insurance companies insure the property and the goods of the company against the risk involved in various operations, buying and selling of the product. Nestle has the differential advantage of working in a smooth coordination with all its marketing intermediaries which helps in providing the best and pure food products to its valuable customers in the different parts of the world.

c) Customers The immediate customers of Nestle are retail and grocery stores which provide the products of the company to the end customers at a reasonable price and a reasonable profit. The end customers of Nestle are the consumers who consume its wide range of product. The company has a bright brand image in its big pool of end customers.

d) Competitors Although Nestle is leader in packaged food industry of Malaysia but the other competitors who are giving tough competition to Nestle are

• Petra Foods Limited • Chocoladefabriken Lindt & Spruengli AG • Yeo Heap Sang Limited • Mail Dairy Industry Co., Ltd

Nestle has a clear advantage over the above mentioned companies is its presence in Malaysia for over a century now. Nestle has been able to setup a good and trusted distribution channel and a huge retail network. The trust worthiness gained by Nestle among the Malaysian people is build in decades on hard work and quality products and varied range of prices, thus even after facing stiff competition with the above mentioned companies in chocolates, dairy products and other packaged food products the company is able to maintain the bottom lines of its profit and loss statements attractive for its investors and good image in public.

e) Marketing The basic marketing strategy of the Nestle was to develop brands for each their product instead of focusing on making brand value for the entire company, thus never allowing cannibalization of products and gaining multiple brand value for the entire company. The vision of the company could be summarized in following statements • Be the leading multinational company in food, nutrition and wellness. • Produce and sell world-class products of the highest consistent quality, reliability and convenience based on business excellence principles throughout our operations. • Maximize the use of good quality local raw materials • Be an exemplary employer with a progressive human resource and social policy; with a management style that is based on “Management Commitment and People Involvement” • Be a responsible corporate citizen, fulfilling all obligations to Government, shareholders, customers, communities and consumers. • Protect the environment by being committed to environmentally sound business practices, and taking into account the need to preserve natural resources and save energy. • Guarantee that all products manufactured, imported and distributed by Nestlé Malaysia are certified HALAL by authorized Islamic certification bodies. • Deliver shareholder value through the achievement of sustainable and profitable long-term growth.

Adhering to the above vision statements the company has been able to maintain the marketing and branding unique and ahead of the competitors.

Macro Environment

Macro environment include following environment of the country Political Environment: government of Malaysia has never imposed any political pressure in fact they have always supported foreign investment and foreign businesses to grow in Malaysia. As the company is into food and nutrition business they have to just adhere to the laws of food and nutrition policies of government and constantly provide good quality which is the vision and mission of the company thus Nestle never faces any problems on political front. Cultural Environment: Malaysian culture is no doubt of having light food at constant intervals and young crowd of Malaysia likes to have good nutritional food thus Nestle has great scope there. Economic Environment: the disposable income of country and the high living standard of Malaysia always give better bigger business opportunities for Nestle. Technological Environment: Malaysia is technologically rich country both in terms of availability of technology and also the technological work force the highly skilled and educated manpower is abundant in Malaysia. In case of Nestle and the product offered by the company these factors do not create much impact in general scenario. However as we have seen the major events like World War had created a positive impact on the sale of confectionary products of the company. The culture has some impact in this company as whether the country has most people as vegetarian or non vegetarian the consumption of milk products is always there. However the countries where the people are more dependent on milk products are profitable market for Nestle.

Key Success Factors

• Consumer Insight: To sustain success the company must have insight of the customers changing needs, you have to be dynamic and innovate and Nestle has been able to do this for last couple of decades.

• Continuous Improvement Programs: Continuous improvement includes innovation in launching new products but equally important is improvement in quality to be better than competitors, improvement in distribution channel which will help Nestle to be at the top. • Regionalization: the regionalization means the regionalization of products and raw resources procurement which means that the company will run like independent entity in each divided region with its own targets and resources. • Development of People: Every company’s responsibility is the development of its employees as that brings good will factor among the employees and which results into lower attrition and higher productivity. • Social Responsibility: this is about creating good will among the people where you operate, about the society which helps and allows you to grow and use its resources and at last the protection and responsibility regarding environment.

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• Research Assignment : NESTLE COMPANY
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Maxwell Martin

Completed orders: 14, requirement, introduction, pestle analysis, porter’s five forces model    , recommendation.

Write a Research Report on NESTLE COMPANY.

In this present paper, we will discuss the analysis of the nestling company. The paper also analyzes the company by pestle analysis and porters five forces model. On the basis of the analysis, recommendations have been made. Nestle company is a transnational drink and food company that lies in food processing industry. Headquarter of the company is in Switzerland, and it is the largest food processor company according to the revenue of the company. The company produces medical food,coffee, breakfast cereals, ice cream, tea, and others. The total revenue of the company in 2015 is 88.8 Billion. The company was founded in 1905 by the merger of Anglo-Swiss Milk Company (v et al., 2016) .The company is primarily listed on the SIX Swiss exchange and then secondary listed on the Euro next. The company is having a wide range of portfolio which includes the huge range of products such as Nesquik, Nescafe, and others. The total employees of the company in 2015 were 335,000. The company serves its product across the world. The company operates in eighty countries, and the most profitable market is North America. The company has strong internationalization strategy which shows the commitment of the company towards its resources and development of the capability to the external environment.

The pestle analysis reflects the various external forces which influence the dynamics of an industry. These forces impact on the behavior of the consumers. The company has the ability to ensure a level of adoption, which is required for the various markets driven by different consumer behavior and cultures. 1. Political segment The political segment of the company is changing regulation which is surrounded by the actions of markets and foods standards. The international process is facing the risk due to the government stability in new emerging economies. The changes in the standardized practice of global regulation lead to the adoption by various political forces. The company faces various problems due to regulations in various countries which do not allow come products in various markets.  The company has to follow different political changes in the developing countries due to which the price of the product become expensive and citizens of developing country are not capable of buying various products (Steger et al., 2015). 2. Economic segment The knowledge of the change in economic rate, inflation rate, a level of income is required because it impacts on the economic stability of the company. The alteration in the budget of consumers and increase in the cost conscious consumer impacts on the profit margin of the company. The rise in the cost of raw material or increase in the demand of suppliers due to which price increases it leads to decrease the profitability of the company. The company faces the problem of economic changes in different countries due to which the problem of supplying the products to the consumers is faced by them. The price of raw material also increase due to which can cost of raw material also increases and selling price of the product is not afford by the consumers in developing countries (Loughlin et al., 2015). 3. Social segment It includes the change in the attitude of the consumers towards the nutrition and healthier products within the same product line by the initiatives of the government. The change in the lifestyle of the consumers by preferring home made products which impact on the sales volume of the company. The company needs to adapt various cultural settings which help to attract a large number of consumers. The personal approach should be used by the company for various promotional activities which help to understand the behavior of consumers. The company is viewed by the consumers as an agency for power in the large external environment. The consumer awareness is increased by social media due to which they want to probe in the manufacturing process. The company is using international standard of product manufacturing which helps to build the trust among the consumers towards the quality of the product (Macdonald et al., 2012).  4. Technological segment The rise in technology creates a large number of options for the consumers which develop the huge competition for the company to sustain in the market. The technical department of the company must be fuelled with innovation which helps to differentiate the product and create the brand image in the eyes of the consumers. The electronic commerce is the platform for the company which helps to develop the brand image through various promotional activities (Petruškevi?ius et al., 2014). 5. Legal segment The legal segment includes a change in the regulations and laws which impact the overall performance of the company. The company needs to adhere to global regulations and amendments across varied international markets (Modi et al., 2013).  6. Environmental segment The company must increase its attention towards the corporate social responsibility such as initiatives to the protection of the environment. The company also considers the packaging of products which must be recycled and does not harm the environment (Babatunde et al., 2012).

1. Bargaining power of buyers The consumers play an important role in terms of company’s performance so the reasonable value should be to the consumers at the time of accessing the position of the company. The bargaining power of consumers is very high in utilizing the various products of the company. The quality of productsmaintained by the company influences the choice of consumers despite various products served by the competitors. The consumer needs must be satisfied which helps to survive in the market by maintains a brand image in the eyes of the consumers. The company also cares about the health of consumers which is reflected in health and wellness programs of the company. Thus the bargaining power of buyer is high (Shankar et al., 2014). 2. Bargaining power of Suppliers The suppliers play an important role in building the brand's image in the eyes of the consumers by supplying raw material on time. The company is having the strong relationship with the suppliers which are necessary for producing agricultural and dairy products. The company is also focusing on developing a strong relationship with help to deliver the strong quality of its products. The company also guides the suppliers for working in an efficiency and effective manner which helps to reduce the redundant expenses. Thus the bargaining power of suppliers is high. 3. Threat of substitute The threat of substitutes is high because from bottled water to milk based products are a threat of substitute goods. The similar products are the arrays which compete directly with the products of the company. The local competitors of china in the same industry compete with the milk based products, so the must innovate their products continuously which helps to sustain in the market. The company has worked on the health and nutrients of the product for maintaining the customer loyalty and competitive edge in the market. 4. Threat of new entrants The company has the very large portion in food processing industry, and it is not common for the companies to quite well. Many companies try to enter into the same industry for gaining some amount of profit but still a threat of new entrants is low because the company is serving from decades by its superior quality of products which satisfies the need of consumers and which enables the company to get a high market share in the food processing industry. The company has constructed sixteen factories in china in 2000 (Njambi et al., 2015). The new entrants must attempt to seize a portion of company’s market share for its survival which is very difficult for the new entrants. The company is constantly targeting and producing its products through consumer focused strategy thus the threat of new entrants is low. 5. Threat of existing competitors The company is having very strong position in the industry of food processing, but the company has major competitors such as Group DANONE and Kraft foods. The companies are continuously competing with each other by its innovation and technology. The marketing and promotional activities of the company help to promoting the product effectively. The competition in food processing industry is violent which benefits the consumers to enjoy innovative products. The improvement in product qualities is persistently enjoyed by the consumers. Thus the threat of competitors is low (Robertson et al., 2014).

From the above analysis Following are the four recommendations:

1. From the pestle analysis it is reflected that environmental factors is the main problem of the  company so it is recommended that the company should adopt various corporate social responsibilities which helps to resolve the environmental problem by contributing towards the environmental health from various activities such as Go green campaign. The packaging must be recycled so that environment must not be harm.

2. Arising from porters five forces model it is reflected that legal factor is the main problem so it is recommended that the company should emphasize on strong business ethics in order to avoid various legal issues such as difficulty in adopting country’s laws and regulations. 

3. The company must generate the intensity to rivalry by providing high quality of product and services by adopting customer concentric strategy which helps to compete among the competitors in the same industry. The personal marketing must be done in order to understand the behavior of consumers which helps to satisfy their needs and demands. The company must use cost competitiveness which enables to generate higher revenue.

4. The bargaining power of consumers is high, so the company must provide speed service in order to satisfy the need of consumers which helps to build brands image in the eyes of consumers.

5. The threat of substitutes is also high so the company must continuously improve its product which helps to maintain the competitive edge in the market.. The strategy of the company must be created in such a manner which do not majorly impacted by the political, economic, legal and social environment. 

Nestle is the transactional food and beverage company which was founded in 1905. The company lies in the food processing industry. The company produces ice cream, coffee, tea, cereal breakfast and others. The portfolio of the company is very huge which consists of various companies such as Nescafe, Nesquik, and others. The pestle analysis describes that the change in government stability impacts on the operations of the company in various countries due to which the selling price increases which is not afforded by consumers thus the revenue of the company adversely affected. The changes in the rate of inflation and other economic factors increase the supply rate of raw material which impacts on the sales volume of the company. The consumer awareness is increased towards the healthy products by social media which impacts the taste and preference of consumers. The technological department of the change must continuously innovate in order to sustain among the competitors in the market. The global regulations must be adhering to the various international markets. The environment factors must be considered at the time of production. The bargaining power of buyers is high because it directly impacts on the demand for products. The bargaining power of suppliers is also high because they directly impact on the supply chain. The threat of substitute is also high because there is a large number of competitors who are providing the same quality of products. The threat of new entrant is low because the company is constantly focusing and satisfying the demand of consumers. The threat of existing competitors is also high because the competitors are also producing with innovative technologies. 

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Steger, J. (2015). Strategic Management of Mars Inc. A Combination of an Innovative Management Philosophy and Familial Eccentricity.

Macdonald, R. (2012). Unilever. A Strategic Analysis.

Babatunde, B. O., & Adebisi, A. O. (2012). Strategic environmental scanning and organization performance in a competitive business environment. Economic Insights-Trends & Challenges, 64(1), 24-34.

Shankar, N., & Perumal, P. V. (2014). A comprehensive strategic evaluation of success of Amul model. EXCEL International Journal of Multidisciplinary Management Studies, 4(6), 222-232.

Njambi, E., Lewa, P., & Katuse, P. (2015). Porter’s Five Forces Influence on Competitive Advantage in the Kenyan Beverage Industry: A Case of Large Multinationals.

Robertson, D., & Caldart, A. A. (2014). The Dynamics of Strategy. Journal of the Operational Research Society, 62(5).

(2016). Nestle.com. Retrieved 19 October 2016, from http://www.nestle.com/

Petruškevi?ius, J., & Granskas, J. (2014). Reducing “NESTLE BALTICS” vending machines idle time. Petruškevi?ius, J. Reducing “NESTLE BALTICS” vending machines idle time: bachelor thesis [Manuscript]. Vilnius, ISM University of Management and Economics, 2012.

Modi, S. (2013). Study on Food and Dairy Industry.

Loughlin, D. (2015). Global Summit of Pest Management Services.International Pest Control, 57(4), 216.

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