Mohammed Salahuddin

• It’s Brand of instant Noodle made by Nestle India Ltd.

• It was found by Maggi family in Switzerland in 19th century.

• Nestle launched Maggi for first time in India in 1982.

• The Brand is popular in Australia, India, Malaysia, New Zealand, Singapore.

• Nestle wanted to explore the potential for instant food in Indian market.

• It took several years and lot of money for Nestle to establish its Noodle brand in India.

• Now it enjoys around 90% market share in this segment.

• 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.

• A concept that provides a way to trace the stages of a product’s acceptance, from its introduction (birth) to its decline (death).

High failure rates No competition Frequent product modification Limited distribution High marketing and production costs Promotion focuses on awareness and information Nestle India Ltd (NIL), Indian subsidiary of the global FMCG major, Nestle SA, introduction of Maggi brand in India in 1982, with its launch of Maggi 2 minute noodles, an instant noodles product With launch of Maggi noodles, NIL created an entirely new food category – instant noodle – in Indian packaged food market. Because of its first-mover advantage, NIL successfully managed to retain its leadership in the instant noodles category.

Segmentation Targeting Positioning Differentiation

Age Kids Taste

Eating Habits Youth 2 minute noodles Flavors

Office goers Packaging

Working Women

Fast to cook, good to eat

Lifestyle of urban families

Taste Bhi, Health Bhi

Health conscious people

1) Promotional campaigns in school.2) Advertising strategies – focusing on

kids.3) New product innovation according to the

needs of consumers – Veg. Atta Noodles, DalAtta Noodles, Cuppa Mania.

4) Availability in different packages – 50 and 100 gms.

Increasing rate of sales Entrance of competitors Initial healthy profits Promotion emphasizes brand ads Prices normally fall Develop costs are recovered 10 years 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 consumer did not like the

taste of the new noodle. In March '99, NIL re-introduced the old formulation of the noodles,

after which sales revived. Over the years, NIL also introduced several other products like soups

and cooking aids under the Maggi brand.

Declining sales growth Saturated markets Extending product line Stylistic product changes Heavy promotion to dealers and consumers Prices and profits fall In 2003, HLL was set to take on Nestle's Maggi by

launching a new category of liquid snacking under the brand, Knorr Annapurna.

Knorr Annapurna Soupy Snax was priced aggressively at Rs. 5 and had 4 variants – 2 chicken and 2 vegetarian options.

Like Maggi, Soupy Snax will be an in-between meal snack and will target at all age groups, particularly office goers.

Long run drop in sales Large inventories of unsold items Elimination of all nonessential

marketing expenses.

Note: Rate of decline depends on change in tastes or adoption of substitute products

Change product

Change product use

Change product image

Change product positioning

New To-The-World New Product Lines Product Line Additions Improvements/Revisions Repositioned Products Low Priced Products

In 2005, NIL introduced 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 grains and provide daily nutrition.

Indian Psyche – Indian palate is not too adventurous in trying new tastes. New product with new taste from different culture will have difficulty in appealing to Indian market.

Price – Atta Noodle was little more than Maggi 2 minutes noodle.

False Claim: Nestle mistakenly aired that noodle 'help to build strong muscles and bone'. The British Advertising Standards Authority said that it was a false claim.

Not Pure Vegetarian – Maggi Noodles also contains additives E627. E627 is partly prepared from fish.

Lack of essential nutrients – New Atta Noodle lacks Vitamin A, C and also fat content is more compare to carbohydrates.

They should conduct test marketing before launching new product.

Focus on creating distinctive image based on twin benefits of 'Instant' and 'Healthy'

Conduct promotional campaigns at schools in small towns with population more than 10,000.

Strengthen the distribution channel of the rural areas within 100 kms of all the metros.

Launch new advertisement campaign (TV, radio and print media commercials) with the brand ambassador.

Leading Brand in India as well as world.

Current Sales – Approx. 90000 boxes – Rs. 4,79,49,000 in Mumbai – 10,00,000 boxes – Rs. 55 cr in India.

Reasonable competitive pricing. Creative interaction blog for

customers.