10773254 maggi-the-product-life-cycle
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Nestle launched Maggi noodles in India in 1982, creating the instant noodles category. It took several years for Nestle to establish Maggi's brand in India. Now Maggi enjoys around 90% market share in instant noodles. Over the years, Maggi launched several new products but its atta noodles launch in 2005 failed due to factors like price, taste preferences, and lack of essential nutrients. Currently, Maggi is the leading brand in India and worldwide with a 94% market share in instant noodles.
10773254 maggi-the-product-life-cycle
- 1. Maggi The Product Life Cycle Submitted By- VIT b- school Vellore
- 2. Introduction of Maggi 2-minutes Noodles It’s a Brand of instant Noodle made Nestle wanted to explore the by Nestle India Ltd. potential for such an Instant food among the Indian market. It was found by the Maggi family in Switzerland in the 19th century. It took several years and lot of Nestle launched Maggi for the first money for Nestle to establish its time in India in the year 1982. Noodles brand in India. Now it enjoys around 90% market The Brand is popular in: share in this segment. - Australia - India Over the years Maggi has - Malaysia launched several products under - New Zealand its Brand Name. - Singapore - South Africa.
- 3. ISSUES • Different phases product life cycle of maggi • Why atta noodle was a failure? • Strategies taken to establish new product category • What measures NIL should take to sustain the image of a popular brand image. • Stage at which maggi is in the product life cycle.
- 4. PRODUCT LIFE CYCLE A concept that provides a way to trace the stages of a product’s acceptance, from its introduction (birth) to its decline (death).
- 5. GRAPHICAL REPRESENTATION OF A TYPICAL LIFE CYCLE Introductory Growth Maturity Decline Stage Stage Stage Stage Product Category Sales Dollars Product Category Profits 0 Time
- 6. Introductory Stage • High failure rates Full-Scale Launch • No competition of New Products • Frequent product modification • Limited distribution • High marketing and production costs • Promotion focuses on awareness and information • Nestlé India Ltd. (NIL), the Indian subsidiary of the global FMCG major, Nestlé SA, introduced the Maggi brand in India in 1982, with its launch of Maggi 2 Minute Noodles, an instant noodles product • With the launch of Maggi noodles, NIL created an entirely new food category - instant noodles - in the Indian packaged food market. Because of its first-mover advantage, NIL successfully managed to retain its leadership in the instant noodles category
- 7. STPD Analysis Segmentation Targeting Positioning Differentiation Age Kids Fast to cook Taste good to eat Eating Habits Youth 2-minute Flavours noodles Lifestyle of urban Office goers Taste bhi health Packaging families bhi Working Women Health conscious people
- 8. Market Penetration Strategies Promotional campaigns in school. Advertising strategies: - focusing on kids. New product innovation according to the need of consumers: – Veg. Atta Noodles. – Dal Atta Noodles. – Cuppa Mania. Availability in different packages: – 50 gms. – 100 gms. – 200 gms. – family packs (400gms.). Conducting regular market research
- 9. Growth Stage • Increasing rate of sales Offered in more • Entrance of competitors sizes, • Initial healthy profits flavors, options • Promotion emphasizes brand ads • Prices normally fall • Development costs are recovered • 10 yrs back it enjoyed around 50% market share in this segment which was valued at around 250 crores. • During the 1990s, the sales of Maggi noodles declined, due to growing popularity of Top Ramen , another instant noodles product. • In order to improve sales , NIL changed the formulation of Maggi noodles in 1997. • However, this proved to be a mistake, as consumers did not like the taste of the new noodles. • In March 1999, NIL reintroduced the old formulation of the noodles, after which the sales revived. Over the years, NIL also introduced several other products like soups and cooking aids under the Maggi brand. •
- 10. Maturity Stage • Declining sales growth • Saturated markets • Extending product line Many consumer • Stylistic product changes products are in • Heavy promotions to dealers and consumers • Prices and profits fall Maturity Stage • In 2003 Hindustan Lever Ltd was all set to take on Nestle's bestselling Maggi 2- minute noodles by launching a new category of liquid snacks under its food brand, Knorr Annapurna. • The new product, called Knorr Annapurna Soupy Snax, was priced aggressively at Rs 5 and had four variants: two chicken options and two vegetarian. • Like Maggi, Soupy Snax will be an in-between-meals snack and will be targeted at all age groups, particularly office-goers.
- 11. STPD Analysis Segmentation to Differentiation: ■ Classic Noodles – 5 – 10 yrs. ■ Veg. Atta Noodles – Health Conscious. ■ Rice Mania – Teenage ■ Cuppa Mania – Office goers, Working women.
- 12. Decline Stage If no product innovation brought • Long-run drop in sales • Large inventories of unsold items • Elimination of all nonessential marketing expenses Rate of decline depends on change in tastes or adoption of substitute products
- 13. Extending the PLC • Change product • Change product use • Change product image • Change product positioning
- 14. CATEGORIES OF NEW PRODUCT/REVISING THE PRODUCT New-To-The-World New Product Lines Six Categories Product Line Additions of Improvements/Revision New s Products Repositioned Products Lower-Priced Products
- 15. Analysis(why Atta Noodles Failed?) • In 2005 Nestlé India launched MAGGI Vegetable Atta Noodles. • Based on consumer needs and evolving trends for more whole grain based products. • Extensive Research and Development expertise to develop Maggi Vegetable Atta Noodles. • Maggi Vegetable Atta Noodles will provide the dietary fibre of whole wheat to facilitate good health and wellness .
- 19. FAILURE CAUSES 1. Indian psyche- The basic problem the brand faced is the Indian Psyche. Indian Palate is not too adventurous in terms of trying new tastes. So a new product with a new taste that too from a different culture will have difficulty in appealing to Indian market.
- 20. 2. Price- The price of atta noodle was little more than maggi 2 minutes noodle 3. False claims- In October 2008, Nestle mistakenly aired an advert that noodle "help to build strong muscles and bone". The British Advertising Standards Authority said that it was a false claim. 4. Not purely vegetarian- Maggi Noodles also contains the additives E150d and E627.E627 is partly prepared from fish,and is thus not suitable for vegetarians. E150d is sometimes made from genetically modified maize
- 21. 5. Lack of essential nutrients- The new maggi atta noodles as can be seen from the fig. lacked essential vitamins A, C,also the fat content was more then carbohydrates 6. Targeted health conscious people…………but atta noodle didn’t appealed them……because of other Substitute supplements in the market
- 22. Suggestive Promotional Strategies 1. They should conduct test marketing before launching new product. 2. Focus on creating distinctive image, based on twin benefits of “INSTANT” and “HEALTHY”. 3. Conduct promotional campaigns at schools in small towns with population more than 10,000. 4. Strengthen the distribution channel of the rural areas within 100 KM of all the metros. 5. Launch new advertisement campaign (T.V., Radio and print media commercials) with the brand ambassador. 6. Conduct Market Research to find out the market penetration of the product in the rural areas covered.
- 23. Current Scenario of Maggi Leading Brand in India as World Market Share well as World. Current Sales: Approx. – 90000 boxes – Rs. 4,79,49,000 in Mumbai – 10,00,000 boxes Maggi 94% – 55 cr. in India Reasonable competitive pricing. Creative interaction blogs for Top Ramen customers: – 4% www.maggi-club.in Other Local 2% Focus mainly on Health Benefits. Maggi 94% Top Ramen 4% Other Local 2%
- 24. Thank you