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Nestle Nescafe Tea

Presentation given by Mohsin H. Alqamari, Farzan Hasan Nazeer, Muneeb Iqbal, Syed Ahmed Owais, Aamir Thobhani, Adnan Hasni on Launching Nestle Nescafe Tea to Sir Iftiqar Munir in the course of "Marketing Management" at Hamdard University City Campus (HIMS).
Marketing Management, 11 th edition, Phillip Kotler.
Nestle website.

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Nestle Nescafe Tea

  1. 1. NESCAFE TEA Marketing Plan 2007 - 2010 1Hamdard University Students
  2. 2. H A M D A R D U N I V E R S I T Y Group Members: Final Presentation Marketing Management Mohsin H. Alqamari - MEXN 230529 Farzan Hasan Nazeer - MEXN 230525 Muneeb Iqbal - MEXN 230543 Syed Ahmed Owais - MEXN 230541 Aamir Thobhani –Mexn 230523 Adnan Hasni – MEXN 230546 Submitted To: Mr. Iftikhar Munir 2007 - 2010 2Hamdard University Students
  3. 3. Introduction Background Introduction of Tea Plant Tea (Camellia sinensis) Family: Camelliaceae Evergreen wildly grows into medium size tree, under cultivation it is pruned and trained as low spreading bush. Into medium size tree, under cultivation it is pruned and trained as low spreading bush. Origin: China Drink as a beverage: 7th century Spread to Japan: 1000 AD Europe: 17th century Discovery of wild tea plants in Assam: 1823 Establishment of tea committee in India: 1834 Raising of nursery in Bot. Gardens Calcutta: 1835 Commercial cultivation in India: 1836 Today, tea is the world's second most popular drink (after water). It's easy to make, affordable and one of the fastest growing beverages (6.5% over 5 years). So enjoy your tea. Everyone else in the world definitely is. Growth Requirements 1. Requires deep, well drained and acidic soil (pH 4.5-6.5) 2. Intermittent rainfall of 1000 mm or above per annum 3. Optimum temperature: 12o C - 30 o C 4. Altitude: Ranging from sea level to 2000 meter 5. Relative Humidity: 60 – 80 % Special Features • Propagated both from seeds & cuttings • Both green & black tea is processed from the same tea plants • Has an economic productive life of 70-90 yrs. Is non-palatable to animals • Grows as evergreen bush or medium size tree • Highly cross-pollinated and self sterile 2007 - 2010 3Hamdard University Students
  4. 4. Defining Tea Tea is a beverage made from the processed leaf of a plant whose Latin name is: Camellia sinensis. Tea is a stimulant, a very mild stimulant, since it contains caffeine. It contains fewer miligrams of caffeine per equal-sized cup than does coffee, but more than cocoa. Tea contains small quantities of tannic compounds technically called polyphenols (not tannic acid used in tanning leather), vitamin A, B2, C, D, K, and P, plus a number of minerals in traceused in tanning leather), vitamin A, B2, C, D, K, and P, plus a number of minerals in trace amounts and also aromatic oils. The tannin compounds and essential oils are, in the main, responsible for the flavor of tea, the color, the astringency (dryness), and the delightful aromatics. These last two substances or compounds join forces to produce the high, medium and base notes of tea that one experiences .These compounds which combine to produce the delicate and sought-after nuance flavors of tea cannot be determined chemically by analysis of the tea. All tea analysis comes out basically the same regardless of the variety or where in the world the tea is grown. It is in the well-developed palate of tea devotees that this decision of goodness is allowed to rest its case. 2007 - 2010 4Hamdard University Students
  5. 5. Types of Tea 1. Black Tea This tea is fully oxidized and is very high in caffeine. There are 4 steps involved in the production of this tea; withering, rolling, oxidizing and firing or drying. 2. White Tea This tea is the unopened bud of the tealeaf. After the bud is picked, it is withered and the moisture is allowed to evaporate and dry. It is very high in antioxidants and low in caffeine. 3. Yellow Tea This tea is rarely found in the states. It is a green tea with yellow leaves that were encouraged to turn yellow by the stir-frying stage of the tea making process. 4. Green Tea This tea is high in antioxidants, Vitamin C and other vitamins and minerals. The freshly picked leaves are allowed to dry, then are heated to stop the oxidation. 5. Oolong The leaves are processed immediately after plucking. They are wilted in the sunlight, shaken in bamboo baskets to bruise the edges, then shaken again and spread out to dry until the leaf turns slightly yellow. There are two categories of oolong- fragrant and amber. 6. Pu ehr This is a compressed tea produced only in China. This tea has health benefits reputed to aid in digestion and weight loss. It also helps to lower cholesterol. 7. Scented These teas are scented with the addition of flowers or herbs and can be a white, green, oolong or black tea. To scent the tea, the tealeaves are layered with jasmine, orchids or other blossoms and herbs. 2007 - 2010 5Hamdard University Students
  6. 6. Introduction Of Nestle: Nestle is the leading FMCG company of Switzerland established by Henri Nestle. Nestle is serving worldwide with its more than 500 factories in 86 countries comprising almost all continents. Nestlé’s product portfolio is more than 500 products all over the world serving best to their customers. Henri Nestlé endowed his company with the symbol derived from his name. His family coat of arms, the nest with a mother bird protecting her young, became the Company's logo and a symbol of the Company's care and attitudebecame the Company's logo and a symbol of the Company's care and attitude to life-long nutrition. The Nestlé nest represents the nourishment, security and sense of family that are so essential to life. The first product made by Henri Nestlé, a food for babies who were unable to breastfeed. His first success was a premature infant who could not tolerate his mother's milk or any of the usual substitutes. People quickly recognized the value of the new product, after Nestlé's new formula saved the child's life, and soon, Farine Lactée Henri Nestlé was being sold in much of Europe. Nestlé has been serving Pakistani consumers since 1988, when the parent company, the Switzerland-based Nestlé SA, first acquired a share in Milkpak Ltd.2007 - 2010 6Hamdard University Students
  7. 7. Nestlé’s Vision: The consumer's voice is the key to Nestlé Pakistan's vision and working. Whether you live in the remotest village or the metropolis of Karachi, Nestle consumer services team stands ready to listen to your concerns and provide answers about our products and guidance on matters of health and wellness. Nestlé’s global vision is to be the leading health, wellness, and Nutrition Company of the world. Nestle’ Pakistan subscribes fully to this global vision. In addition to that, Nestle Pakistan also envisions to: • Lead a dynamic motivated and professional workforce that is proud of its heritage and bullish about the futureits heritage and bullish about the future • Meet the nutritional needs of all age groups through a diversified product range that contains an innovative portfolio of branded food and beverages of the highest quality • Maintain long-term growth and deliver shareholder value • Establishing responsible communication with the consumer which in turn can provide us a better look into what changes need to be made to our products • Strengthen the position as the best career destination for talented and motivated individuals 2007 - 2010 7Hamdard University Students
  8. 8. Mission Statement: “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.” 2007 - 2010 8Hamdard University Students
  9. 9. SITUATION ANALYSIS MARKET SUMMARY Tea is the cheapest and most popular beverage that served at both professional and social gatherings all over the world. In Pakistan, it counted as a staple food item of common person and an integral part of our culture and heritage. Due to these causes, Pakistan consumes a substantial quantity of tea. Tea is Pakistan's favorite hot beverage. Although efforts made to cultivate tea in the mountainous areas, the projects could not achieve the desired results. Under this scenario,mountainous areas, the projects could not achieve the desired results. Under this scenario, tea imports rose from approximately US$ 120 million in 1998-99 to US$210 million in 1999- 00, showing an increase of over 65 per cent. Its imports were US$173 million in 2002-03.and still it is increasing. The above figures show that the total tea market present in Pakistan is 150,000 tons and the organized market show 80,000 tons and the unorganized show 70,000 tons. Here organized depicts the market owned by the brands and unorganized depicts that this portion is owned by the loose tea. The main competitor for organized tea market is the unorganized tea market present in Pakistan. 2007 - 2010 9Hamdard University Students
  10. 10. MARKET SHARE PICTURE Our focus is on organized tea market. Where different companies like UNILEVER and TAPAL are holding the main market share. Some other companies also present in the market but having very low share of the market. Unilever Pakistan limited has 43% market share Tapal private limited has 41% market share Vital tea limited has 6% market share Tetley has 4% market share The remaining 6% belongs to other market share in the organized market 6% 6% 4% Unilever Tapal Tetley Vital Unorganized market also captures a good market share in the total tea market of Pakistan. 70000 tons out of 150,000 consumption is of unorganized tea.71percentage of total population of Pakistan are living in rural areas. Due to illiteracy and lack of awareness, they are consuming unorganized tea, which is mainly affecting the organized tea market. Due to this, they are enjoying a very big market share of the total tea market. Organized segment mainly depend on the imported tea. Mainly big players are importing tea from different countries like Kenya, uk, Bangladesh. Last some year’s imported figures for Pakistan is described in the chart below. Unorganized tea is mainly smuggled from different neighbor countries of Pakistan. That’s why it has a large proportion in total consumption of tea in Pakistan, which is 70000 tons of total 150000 tons. 43% 41% Vital O thers 2007 - 2010 10Hamdard University Students
  11. 11. COMPETITOR ANALYSIS The main competitor of Nestle is Tapal & Unilever Pakistan, which has the 43% of market share with its different brands as Yellow Label SupremeSupreme Red Rose Pearl Dust Yellow label has the sale volume of almost 10000 per ton and its other brand Supreme with the lead 16000 per ton. Its lead is due to more rural and small towns which this brand is targeting. Overall the Unilever has the sale volume per ton of almost 34000. A-one kark is also another brand targeted to the rural areas 2007 - 2010 11Hamdard University Students
  12. 12. MARKETING STRATEGIES MISSION “To satisfy our stake holders as a guiding principle in our principle be a benchmark for quality, creativity and ethical values.” MARKETING OBJECTIVES The objectives of the marketing plan are strategically centered on 3 criteria • To create a strong consumer awareness against unorganized tea product, • To establish a wide brand recognition through the capture of market shares in the multi segment, and • To become the main challenger in that particular segment within the strong research and development. 2007 - 2010 12Hamdard University Students
  13. 13. TARGET MARKETING The target market is that they are defining for our brand Nescafe Tea is the A class and B+ class. The target of this brand is the urban areas of the country and along with the use in offices and business class as well. MARKET CHALLENGER STRATEGYMARKET CHALLENGER STRATEGY The strategy adopted by the Nescafe Tea is marketing challenger strategy. Nescafe tea would be basically the one to one competitor against Lipton yellow label. The class and geographical location we can say is almost same for both the brands POSITIONING TO A class and B+ FOR NESCAFE TEA DIFFERENTIATION DANEDAR TEA 2007 - 2010 13Hamdard University Students
  14. 14. MARKETING MIX PRODUCT The core o Tea Beverage The actual product o Packaging and labeling: see figure in fronto Packaging and labeling: see figure in front o Branding: brown color, aspect of refreshing, hard pack and soft pack both. o Trade name: Nescafe Tea, a Nestle product o Brand personality Freshness, Healthy, Innovative, etc. o Brand equity: Nescafe Tea provides a quality, consistent, innovative and accessible tea reputation. Marketing considerations Product life cycle: Nescafe Tea is a product at its Introductory stage so they are trying to capture the share of its competitor and finding new multiple segments to differentiate themselves. 2007 - 2010 14Hamdard University Students
  15. 15. PRICE The pricing strategy that we are following for Nescafe is cost oriented as the price that Nescafe is taking is comparatively low then its main competitor Yellow label tea. The price going for some products are 200 grams Nescafe Tea Hard Pack 85Rs. 400 grams Nescafe Tea Family Pack 160Rs. Prices for Lipton Yellow Label Tea 200 grams Yellow Label 95Rs. 500 grams Yellow Label 235Rs. So its price we can say that varies according to cost and even in high quality which they are claiming their price is low as compared to Yellow Label Tea. 2007 - 2010 15Hamdard University Students
  16. 16. CHANNELS OF DISTRIBUTION Manufacturer ------◊◊◊◊ Distributor---------◊◊◊◊ Retailer --------◊◊◊◊Consumer The channel of distributions according to this brand Nescafe tea is simply as shown by the diagram as manufacturer to distributors who vary according to geographical dispersion and then to retailer to final consumer. Nescafe has a great channel of distribution not only to this brand but also all other brands that vary geographically according to consumer needs. Nescafe has 5 main warehouses in Pakistan which are located in the following cities.Nescafe has 5 main warehouses in Pakistan which are located in the following cities. 1. KARACHI 2. HYDERABAD 3. SUKHUR 4. MULTAN 5. RAIWIND From these warehouses the product move to the distributors channels. And from these distributors the product move to the next, which is retailer and then to the consumer. This is also one of their strengths that they have a strong distribution channels. 2007 - 2010 16Hamdard University Students
  17. 17. 1. MARKETING PLAN: 1. PROMOTION STRATEGY SETTING OUR GOALS Need to introduce our Nescafe Tea in such way that we may easily catch the target market and win some market share. For that we will announce some sort of Contests/ Award Promoting Plans and Premium offers so that the market may be attracted with these promotions and try our product. CONTEST We can announce a contest in some of our supermarkets, the promotion, which willWe can announce a contest in some of our supermarkets, the promotion, which will start from the day of the launching the Tea. Various programmes for tea lovers and those who want to know more about the different types of tea offered by Nescafe. By this promotion Nescafe will educate and reward consumers by giving away free samplings and by holding contests for consumers. Contests will be if they purchase the new Nescafe they will get a chance to win a stay at PC Burbin for 2 nights and 2 days. PREMIUM We will also offer 10% increase in the Tea with the same price for the first 3 months promotion. And after catching the prospects we will remove this promotion. 2007 - 2010 17Hamdard University Students
  18. 18. 1. MEDIA STRATEGY The Media Strategy is a very important and crucial strategy as the viewers need to be properly aware of the new product and its benefits. Through media strategy we will be able to catch the viewers sitting at home, driving their car, listening to the radio, walking on the streets, going to shopping center, super markets, online advertisements, etc. So the Media Promotion Strategy will play a vital role to ensure that the viewers keep this Tea on the TOP OF THE MIND. MEDIA SELECTION Nescafe will be promoted through different media channels, banners, bill-boards, add commercials, radio adds, Direct Marketing for free Tea Testings at different Super Markets. MEDIA EFFECTIVE FREQUENCY Nescafe advertisements on Television need to be on the crucial timings on some family channels like PTV during the evening and 9 pm news, also the commercials need to be on some Indian Channels as well due to family dramas and movies, so atneed to be on some Indian Channels as well due to family dramas and movies, so at the intervals the first add needs to be of Nescafe . Frequency of this advertisements needs to be very high in the first two months and then we will lower it down after catching some audience and target markets. Similarly on the Radio, the audio adds need to be on some family Radio Stations like FM 107, FM 91 & FM 89 on the commercials of some high frequency catching programs. We will be having a song which will be running through out the commercial in order to keep the attraction on the audience. MEDIA VEHICLES We will contact Allied Media Corp. who will create and place our ads in the appropriate media: TV, Newspapers, Internet or Radio, that will deliver our new product message. Allied Media, will Improve the effectiveness of our marketing or public relations promotions by integrating display magazine, newspaper, radio advertising, and other creative media campaigns and increase our sales, customer response, or increase traffic to your website. There are other media vehicles as well which we can contact in order to get a cheapest way of communicating the message to our customers. 2007 - 2010 18Hamdard University Students
  19. 19. 1. PR CAMPAIGN The PR Campaign will also play a very important role in the light of the promotion of Nescafe. Through the PR Campaigns we will catch the audience very quickly. Some basic questions that we will help us at the time of planning our PR Campaign are as: 1. What is the medium for the strategy? 2. What are the key contacts? 3. How Strong are the necessary personal relationships required for this plan? 4. Is this plan thorough? Have we considered the downside risks? 5. Are we ready to deliver this package to media? MEDIA RELATIONSHIP AND PUBLICITY Media Relationship will be the most important aspect for our PR because the effective media will generate publicity. We will even add value to our product by participating in some of the awards ceremonies and sponsor them so that our product can be caught in the eyes of people seeing the program either at that place or at home. Also some media celebrities will help us promote our tea by adding them in our commercial advertisements so that they easily attract the audience and add more sales to our product. Especially if we have Marina Khan Morning or other elder family representative like Amna Haq or Dr. Shaista Wahidi. This way a large audience of the middle and higher class will try to attempt the tea. Also we will have a slogan for our Nescafe which will be some what like “Relaxing means Nescafe ”. 2007 - 2010 19Hamdard University Students
  20. 20. Nestcaffe Tea: Creative Strategy: 1- Product concept. 2- Product Differentiation. 3- Life Cycle. 1-Product Concept: Nescafe which is market leader in retail coffee market wanted to enter the huge tea market of Pakistan which comprises of 150,000 million tons. So they have researched and made a tea which gives consumers a strong taste and aroma as its coffee provides. (A)-Strong Taste. (B)-Strong Aroma. (C)-Strong Color. 2007 - 2010 20Hamdard University Students
  21. 21. 2-Product Differentiation: Nescafe has differentiated it product from its competitors on the basis of: (a)-Price. (b)-Packaging. A -Price: Medium Price Brand targeting Middle class, Youth and Intellectuals. As averaged price strongly meets the current economic situation of Pakistan where inflation is double figures and people are left with low disposable income. This tea is mend to capture that middle class market who are working in intense situations , studying hard to build there careers and have tightin intense situations , studying hard to build there careers and have tight schedules of meeting targets. They are the ones who are exhausted a lot and need something to revitalize, give them a brake and enjoy. They are the one who have the need for a strong tea and can still afford the luxury of having tea in these tight economic situation. B -Packaging: -It is packaged in Yellow and black so as to give an appealing look. -Contained in foil to increase its life. -Also available in re-useable airtight plastic jars. -It is available in 200, 400 gram packs. -Its 200 grams pack is designed as a SKU to capture small shoppers shalves.2007 - 2010 21Hamdard University Students
  22. 22. 3-Life Cycle: Product Life Cycle: 1-Question Mark. 2-Stars. 3-Cash Cows. 4-Dogs. BCG Matrix: Stars Question MarkStars Question Mark Nescafe Tea Cash Cows Dogs Since our Nescafe tea is a new product, therefore it is situated in the Question mark portion of the BCG Matrix. Needs Time, dedication and huge investment in marketing to move it from question mark to Star position.2007 - 2010 22Hamdard University Students
  23. 23. Communication Objective: -Attention. -Interest. -Desire. -Action. Attention: -Youth (School, college and University Students). -Executives. -Middle class housewives. Interest: -Tea that revitalize you. -Gives energy. -Gives you a brake. Desire: -Strong Color. -Strong Aroma. -Strong Taste. Action: -Give it a brake, make tea and enjoy. 2007 - 2010 23Hamdard University Students
  24. 24. Industry Attractiveness from Poter`s Model Forces Low Medium High Barriers to Entry * Barriers to Exit * Rivalry Among Competitor * Power of Buyers *Power of Buyers * Power of Suppliers * Availability of substitute * Government Action * Overall Assessment * 2007 - 2010 24Hamdard University Students
  25. 25. Existing Product New Product Existing Market Product Development Anns offs Model Existing Market Product Development New Market 2007 - 2010 25Hamdard University Students
  26. 26. Thank you chill with Nescafe Tea 2007 - 2010 26Hamdard University Students