B

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M
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BY:
R
AANCHAL BIRDI
ANUPAM KAPOOR
I
KANIKA SOOD X
Nestle India limited
• Riding on the growth of its power brands, Nestle has
extended its dominance in food business in India as well.

• However, a number of its brands require a repositioning.

• The present exercise is an attempt to analyse the position

of the different brand offered by Nestle India.

• BCG matrix of Nestle and all the different brands offered

by Nestle in India have been analysed along with a critical
insight and also specific suggestion have been made
therein.
The objectives
• (i) To place the various brands of Nestle in India
in the matrix as suggested by the Boston
Consultancy Group, as based upon the
Secondary data collected.

• (ii) To analyse the brands so placed and critically

compare their placement.

• (iii) To compare the outcomes so obtained and

generate suggestions.
BCG Matrix
• The beauty of BCG Matrix, a Matrix developed by a group
known as Boston Consulting Group, USA, is that it seeks to
place the different products of an organization in different
grids such as to analyze them in a comparative manner in
terms of profitability or in terms of

• (a) percentage growth in sales and

• (b) market share position, to be exact. Thus

• it gives an opportunity of self assessment to the organization

to reassess its product positioning and come out with
alternative solution if the original placement of the products
in the market does not meet the desired level of growth.
Nestle India and BCG Matrix
• With headquarters at Vevey, Switzerland and established in 1866,
Nestle has growth today to be the world’s biggest food and
beverages company.
• Established in the strong foundation of growth through innovation
and renovation, the company is known today by its several strong
brands which are dominating the markets the world over.
• Nestle India is a subsidiary of Nestle S.A. of Switzerland. With six
factories and a large number of co-packers.
• Nestle India is a vibrant company offering a number of products in
the Indian market. In the first nine months of 2010, it achieved
strong growth of around 21%
• A number of brands are offered by the company in the country of
which while some have already established a strong hold, many
others exhibit enormous prospects to dominate the market and are
only waiting for a favourable opportunity or appropriate and sizeable
promotional campaign by the company.
 NESTLE BRANDS
MILK PRODUCTS AND NUTRITION PREPARED DISHES AND COOKING AIDS

1. Nestle Everyday Dairy Whitener 1. Maggi 2 minute Noodles

2. Nestle Everyday Ghee 2. Maggi Atta Noddles
3. Nestle Milk 3. Maggi Cupa Mania
4. Nestle Slim Milk 4. Maggi Soups
5. Nestle Milkmaid 5. Maggi Suces
6. Nestle Dahi 6. Maggi Bhuna Masala
7. Nestle Neslac 7. Maggi Pazzta

BEVERAGES CHOCOLATES AND CONFECTIONARY

1. Nescafe Classic 1. Nestle Kitkat

2. Nescafe Sunrise Premium 2. Nestle Milkybar
3. Nescafe Sunrise Classic 3. Nestle Bar-One
4. Nescafe Cappuccino 4. Nestle Munch
5. Nescafe Ice Tea 5. Nestle Eclairs
6. Nescafe Hot Tea Mixes 6. Nestle Polo
7. Nestle Pure Life
 BCG MATRIX
STARS QUESTION MARKS
1. Milo
Nescafe 2. Nestle Kitkat/Barone/ Munch
BUSINESS GROWTH RATE

HIGH

Maggi Noodles 3. Maggi Sauces

4. Maggi Soups
5. Nestle Butter
6. Nesvita
7. Milk

8. Nestle Maggi Pickles

9. Nestle Butter
CASH COWS DOGS
LOW

Ceralac 1. Nestea
2. Milky Bar
3. Nestle Crunch

HIGH LOW
MARKET SHARE
Product: Nescafe
Position: Star S- 60% M-+6% CAGR

• Reasons for present positioning:

• (1) Nescafe is one of the leading coffee brands in the Indian
market.
• (2) It has find a dominance which is unparalleled by any other
brand in the country.
• (3) Not only does it have a high market share but it growth
rate is also significantly
• high.
• (4) The name Nescafe has become generic with coffee.
Product: Maggi Noodles
Position: Star S- 80% M-+20% CAGR
• Reasons for present positioning:
• (1) It is surprising to note that Maggi Noodles, which has
found more households of consumption in India that any
other country in the world and has become the first
preference of Indian children in terms of instant food, but with
other competition prospects are changing
• (2) The reason essentially lies in the fact that though Maggi
Noodles has a significantly high market share in the Noodles
market in India, the market growth rate of Noodle
consumption is growing very high.
• (3) Though the number of repeat purchasers is high in case of
Maggi, the rate of increase among the new purchasers is also
growing.
Product: Ceralac
Position: COW S- 85%

• Reasons for present positioning:

• (1) Ceralac has become one of the leading baby
food products
• (2) It has witnesses quite a long hold in its
market share with its sales increasing on a
continuous basis for almost more than one and a
half decade.
• (3) Its different variants have kept competitors at
bay and its finds a place easily at almost every
general or provisional store in the Indian market.
Position: Question Mark
Intended Placement: Star
• (The reason why these are is not placed as a dog is that it has the potential to
expand
• and also because the product lies in a market with high business growth rate.

• The retailers don’t give much importance to these items as an item on the shelf
but they also do not completely disregard it off their stores.

• WHY?

• These might have not seriously taken promotional drive.

• The main chunk of advertisements is seasonal
• Extensive promotional exercise meant to place it in the mindset of the Indian
psyche.
• It has huge avenues for growth especially analyzing the extending Indian market.
Position: Question Mark
Intended Placement: DISINVEST
• Reasons for present positioning:
• (1) Maggi Pickles and, on account of its limited variety (especially in this taste
crazy country) and comparatively higher prices, has been unable to acquire a
market
• necessary for its bare minimum existence.

• (2) The sales of Maggi Pickles has never really trigged since its launch.

• (3) The placement of Maggi Pickles is doubted for the twin reasons of its high
price and packing, which seems to target it to the upper substrata while the
lack of a significant number of variants poses it a challenge to maintain itself
in such households.

• (4) It is not a dog because it is not the market which has low growth rate. In
fact the market of packaged pickle is growing but it is Maggi Pickles which is
unable to gather a substantial share in this growing market.
• (1) Placing Maggi Pickles on the hearts and mind of the
typical taste centric and money conscious Indian
consumer will require an overhauling and huge
investment.
• (2) Extensive price cuts are required but the matching
returns are doubtful.
• (3) Pickles being a non-durable product and their success
essentially related to the taste of the consumer, are not
one of the core competencies of Nestle, which is better
known to introduce standard taste in the country and get
them approved by the consumers.
• (4) Thus it is better advised to disinvest in the business
and focus on other brands.
• Reasons for present positioning:
• (1) Nestle Butter, though available in the market for
some time now, has not found much support from the
consumers primarily on account of the dislike of the taste
of Nestle Butter.
• (2) Considered as salt less, Nestle butter again is yet to
grow from its pre-launch position on account of the huge
competition it faces from Amul, the market leader in this
field.
• (3) Now, as the market growth rate is quite significant,
yet as Nestle Butter has not acquired a better share in
the market, it has been placed in the category of
Question Mark.
• 1) Facts do not favour Nestle to continue with its butter.

• (2) Instead of no response, a significant number of

retailers are of the opinion that Nestle Butter seems to
be rejected by the consumers for the reason that its taste
does not suit the Indian psyche.

• (3) Thus it is advisable for Nestle to discontinue with

butter, as it did with its water brand, Pure Life. Also, it
would be better to concentrate on other brand than to
go in for a head on collision with Amul, the market
leader, which is inevitable on account of the same
market which both the products cater to.
• Product: Milky Bar
• Position: Dogs
• Reasons for present positioning:
• (1) It become quite popular in and around the year 2000 but it
never reached the stage of a power brand.

• (2) Primary tried by the Indian consumer as a craze which laid in

trying the first nonbrown chocolate, Nestle Milky bar was a sweet
chocolate with cream color. Thus the primary acceptance of Milky
bar was not based on its core qualities but on the basis of certain
peculiarities which it contained, differentiating it from other
products in the same line.

• (3) Milky Bar, as a chocolate, though has a growing market, yet it

has been placed as a dog on account of the inherent lack of core
quality which makes it generic with chocolates. This was the main
reason why it was never considered a competitor by other
chocolate manufactures and the consumers also treated it so.
Intended Placement:
Disinvest
• Comments:
• (1) Milky Bar has lost the primary battle which it had with
mindset of the unaware Indian consumers who could never
contemplate a non-brown chocolate.
• (2) The market positioning of Nestle Milky Bar has been only
to children (as one can contemplate from the advertisements
which relate only to children in the age group of 10 -15) and
thus it has lost the adolescent consumer, which is also a
• major part of the entire consuming segment of chocolates.
• (3) The promotion style of Milky Bar has disappeared. The
advertisements have been too soft and not too impressive.
Thus success of Milky Bar requires rebuilding the image of
Milky Bar.