Product Strategy

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Who are the customers of maggi

In demographic segmentation Maggi’s 2-minute instant noodles divides market the


market into groups based on variables such as age, family size, family life cycle, income,
occupation, education, religion, race, generation, gender and nationality. Region includes
urban, semi-urban, and rural. It can be found anywhere even in hypermarket,
minimarket, convenience stores like 7-eleven. For occupation included which
included housewives, working professionals, self-employed.

Psychographic

Psychographic segmentation divides buyers into different groups based on social class,
lifestyle, or personality characteristics. People in the same demographic group can have very
different psychographic makeup.

Behavioral

Behavioral segmentation divides buyers into groups based on their knowledge, attitudes, use,
or response to a product. Customers can be segmented according to their user status as non-
users, ex-users, potential users, first-time users and regular users of a product. Loyalty
status defined as hand core and shifting loyal. For example, Maggi will offer special
discount for those loyal customer by used packaging or repeat purchase.

Target marketing

What is the positioning marketing of Maggi?


Why the specific Brand positioning? Maggi was positioned as '2-minute noodles' with a punch line
that said 'Fast tocook! Good to eat! ' And this gave the implied understanding to the consumerthat it
was a 'between meals' snack.

Positioning

Its advertisements projected magi as a fun snack for the kids which gave the mothers ease of
preparation. Maggi is positioned for consumption for the consumption household. Its primary target
audience is the children in the age group between – 6-14 years

Product Strategy

Maggi is one of the leading food brands under the umbrella of Nestle. The instant noodles category
has a vast variety and is very popular all across the globe. The major products in this category are 2-
minute Noodles, Vegetable Multigrain Noodles, Chicken Noodles, Cuppa Mania, Oats Noodles, Hot
Head Noodles, Atta Noodles. These variants are the backbone of the product strategy in the Maggi
Marketing Mix.

Price Strategy
Maggi uses a Cost-based Pricing Strategy to tap into different markets in the world.
The competitive prices are repaid with a high volume of the products. This shows the cost and
competition are the major factors in the marketing mix price strategy of MAGGI.
Because of rising prices in different countries, MAGGI has smartly started decreasing the quantity to
keep the price unchanged. Nestle strives to capture a high market share with minimum prices and
maximum quality standards. As Maggi is trying to tap into all segments of income factors, it keeps
differential prices depending on the locations across countries. Also, its offering is available in a
broad variety of packages so that people can buy according to their needs. Recently, Maggi has
started coming up with fresh products like the Hot Head Noodles and Cup range which it targets for
the higher income level segment and hence are priced at a higher range.

Place and distribution strategy

Maggi products are taken from the factories directly which are individually managed to convey and
forward agencies who then store in their warehouses and send them to the wholesalers. According
to their demanded quantity. These quantities are then distributed among the retailers, other small
businesses.

Promotion Strategy

Maggi has used advertising as its major promotional strategy to create awareness. Initially, it is
focused on kids and working women who have less time to prepare food. The advertisement mainly
showed on kid’s channels with various effective taglines.

SWOT Analysis of Maggi


Strength
 Maggi is the market leader in the noodles sector, with a high level of customer loyalty. 
 Maggi is a top-of-mind brand thanks to its excellent advertising. 
 Because of Nestle, there is a wide range of products available.
 Maggi comes in a wide range of tastes. 
 The power of Nestle’s parent brand adds to the brand’s strengths. 
 Maggi sells soups, sauces, and other items in addition to instant noodles.
 It’s simple to prepare and ready to eat. Noodles are very popular among students, young couples, and
teenagers.
 Maggi has a lot of exposure thanks to TV commercials, print ads, web ads, and out-of-home media.
Weaknesses 
 Risk of Overdependence: Maggi Noodles accounted for 57 percent of the company’s income in 2014, even
though their market share has shrunk dramatically (from 84 percent in 2012 to 63 percent in 2014). Although
there are increasingly more competitors, the market is still growing.
 With more and more educated people becoming more health-conscious, awareness of Maggi’s negative
impacts is growing.
Opportunities
 Maggi’s economic packages can reach out to untapped rural markets. 
 Can use Nestle’s distribution and brand recognition to establish a global presence. 
 New flavors and packaging can assist the business in expanding its customer base.
 Maggi can form partnerships with schools, colleges, hotels, and other organizations to deliver ready-to-eat
snacks.
Threats
 The company is concerned about stiff competition from both local and national players.
 The spread of adverse effects of Maggi noodles via the internet and social media poses a
threat to Maggi’s survival. Because a decrease in the Maggi brand’s perceived value as a result of
its Noodles product category might have an impact on the brand as a whole.

Life Cycle

Popular in many countries like Australia, New Zealand, South Africa, India, Nestle wanting to explore

the potential for such instant food/noodle brand in India, launched Maggi in the year 1982. It took

several years and lot of money for Nestle to establish its noodles brand in India.

When Maggi noodles was launched in India it had segmented the based on age and urban families

targeting kids, youth and office goers positioning itself as fast to cook, 2 minute noodles, with the

tagline of “taste bhi, Health bhi”. Positioning however was not an issue, as no instant noodle had

been launched in India, Maggi was the first one.

In the initial stages, Maggi had high failure rates, frequent product modifications(to adjust to Indian

consumer), high marketing and product cost as they were trying to build product awareness. With a

lot of ups and downs and high failure rates, Maggi survived the introductory stage.

Let us now see the next stage in the product life cycle of Maggi, the growth stage.

Growth Stage in Product Life Cycle of Maggi


Around 1985, the demand for Maggi had increased tremendously in India recovering their

developmental costs and increasing the sales rate. Maggi remained the monopoly in the Indian
Market till 1990, after which Top Ramen entered the market reducing the market share of Maggi a

little.

10 years back Maggi had 50% of the market, In order to increase its sales again, Maggi introduced a

new flavour in 1997 which wasn’t well accepted by the consumer, thus in 1999, Nestle re-launched

its old flavour of Maggi, getting back on track in terms of sales.

Over the years, Nestle has also introduced many products under the Maggi brand, like the ketchups,

soup, oats, pasta, more noodle flavours etc.

Maturity Stage in Product Life Cycle of Maggi


During it’s maturity stage, Maggi’s sales were at peak, production costs were low and profits were

high. In 2003, Hindustan Unilever Limited (HUL) was all set to take on Nestle’s Maggi by launching a

new category of liquid snacks under it’s food brand Knorr Annapurna.

Priced aggressively at 5Rs, the new product called Knorr Annapurna Soupy Snax was made

available in 4 varieties. Like Maggi, it had a similar target market and positioned it in a similar

manner.

Also, Maggi faced tough competition from Top Ramen. That led to decline in sales, signifying that

Maggi had entered the maturity stage.

Maggi reaching the peak and seeing the sales rate declining launched a series of new products.

While keeping price aggressive at 5 Rs and made the distribution channel more intensive to

encourage their product over the competitor.

Let us now see the last stage in the product life cycle of Maggi, the Decline Stage.

Decline Stage in Product Life Cycle of Maggi


There were certain hiccups in the way- like the banning of Maggi. Due to high lead content almost

led us to believe that our favourite noodle brand is now off the shelf. And may be reached its last

phase, i.e., the decline stage.

Read the entire story of how Maggi escaped its death here!

But Nestle invested more in the research of Maggi and took corrective actions. For example, Internal

employee engagement, increased campaign, more activities on social media, and revived back from

the near disaster.

Talking about the current scenario, After the world was hit by the Corona Virus Pandemic In the year

2019, Maggi sales shot up by 25% as consumers stayed home and stockpiled instant noodles.

With increase in total and domestic sales by 8.1% and 8.5%, respectively, Maggi’s revenue in the

year 2020 and 2021 is continuing to increase. Maggi therefore escaped its death and climbed back

from the decline stage and recovered well.

These were the most important stages in the product life cycle of Maggi!

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