A project report on consumer buying behaviour towards

Submitted to Submitted By

Prof M.D.Kakade Md Javed Khan(25)

Neeshu Agarwal (27)

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BHARTI VIDYAPEETH DEEMED UNIVERSITY, PUNE

INSTITUTE OF MANAGEMENT AND ENTREPRENUERSHIP DEVELOPMENT,

PAUD ROAD, ERANDWANE

PUNE-38

CERTIFICATE OF COMPLETION

This is to certify that Md Javed Khan and Neeshu Agarwal are a bonafide

student of MBA (BA) program of the university in this institute for the year

2010-2012. As a part of the , the student has completed the project report

titled, “A STUDY CONSUMER BUYING BEHAVIOUR TOWARDS NOODLES”

The project report is prepared by the student under the guidance of Prof.

M.D.KAKADE

(Teacher Guide)

Date:

Place: Pune

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D E C L A R A T I O N

I, MD JAVED KHAN AND NEESHU AGARWAL

undersigned hereby declare that the project report entitled: “A

STUDY CONSUMER BUYING BEHAVIOUR TOWARDS

NOODLES”. Written and submitted by us is submitted to

Prof.M.D.KAKADE is our original work. The empirical findings

in this report are based on the data collected by myself. While

preparing the report I have not copied from any report.

MD JAVED KHAN (25)

NEESHU AGARWAL (27)

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PREFACEMarketing has to go beyond the various influences on buyers and

develops an understanding of how consumers actually make their buying

decisions. We are exposed to marketing in almost everything we do; we

see marketing in the advertisement that fills our newspapers. But

marketing is not that simple as it appears to be. The mission of present

day marketing is not 'telling and selling', but, satisfying customer 'needs'

and 'Customer delight'. Customer is the fulcrum around which all

marketing activities revolve.

To start any business the success entirely depends on the marketing

research

done about the particular and the consumer attitude towards the

product.

Marketing research plays a vital role in a business to make it success. In

this era where time is very big factor for everyone. Every person wants to

save his every second to utilize it to achieve more and more goals, and

with less time, people want the better facilities and in short time.

When the traveling is the factor, people choose that how best, they can

travel, what facilities they can get and how much time and money they

can save.

In the marketing point of view, the behavior of the consumers effects

deeply on the concerned organization. So that why, I am here to

analyzing and study the consumer behavior towards the Maggi noodles

and Horlicks foodles.

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INDEX

SERIAL NO NAME PAGE NO

1 Executive summery 6

2Introduction

7

3Strategic analysis of Maggi and Horlicks foodles (Company Profile)

33

4RESEARCH METHODOLOGY

63

5Survey Results

65

6 SUGGESTIONS AND CONCLUSION

73

7 Bibliography 77

8 Annexure 78

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EXECUTIVE SUMMERY

The report entitled “A study of consumer buying behaviour towards

Maggi and Foodles” deals with the study of Maggi brand and Horliks

foodles that was launched in India in the year 1983, by Nestle India

Limited, and foodles in the year of 2009 which became synonymous with

noodles. This research paper tries to find consumer buying behaviour

towards these products. This research paper also finds of reach of

foodles and Maggi .Describes the level of involvement and types of

consumer problem solving process. This research will also explain how

situational influences may affect the consumer buying decision process.

Understand the psychological influences that may affect the consumer

buying decision process.

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INTRODUCTION

CONSUMER BUYING BEHAVIOUR :

All marketing starts with the consumer. So consumer is a very important

person to a marketer. Consumer decides what to purchase, for whom to

purchase, why to purchase, from where to purchase, and how much to

purchase. In order to become a successful marketer, he must know the

liking or disliking of the customers. He must also know the time and the

quantity of goods and services, a consumer may purchase, so that he may

store the goods or provide the services according to the likings of the

consumers. Gone are the days when the concept of market was let the

buyer’s beware or when the market was mainly the seller’s market. Now

the whole concept of consumer’s sovereignty prevails. The manufacturers

produce and the sellers sell whatever the consumer likes. In this sense,

“consumer is the supreme in the market”.

As consumers, we play a very vital role in the health of the economy

local, national or international. The decision we make concerning our

consumption behaviour affect the demand for the basic raw materials, for

the transportation, for the banking, for the production; they effect the

employment of workers and deployment of resources and success of

some industries and failures of others. Thus marketer must understand

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this. The consumer behaviour suggest how individual, groups and

organization select, buy, use and dispose of goods, services, ideas or

experience to satisfy their needs and wants. It also clues for improving or

introducing products or services, setting price, devising channels etc.

Since liberalization 100% FDI is allowed in India. This has attracted

foreign companies to penetrate the Indian market. The marketers always

look for emergent trends that suggest new.

As a consumer we are all unique and this uniqueness is reflected in the

consumption pattern and process purchase. The study of consumer

behaviour provides us with reasons why consumers differ from one

another in buying using products and services. We receive stimuli from

the environment and the specifics of the marketing strategies of different

products and services, and responds to these stimuli in terms of either

buying or not buying product. In between the stage of receiving the

stimuli and responding to it, the consumer goes through the process of

making his decision.

CONSUMER BEHAVIOUR

Consumer behaviour is the study of how people buy, what they buy, when

they buy and why they buy. It is a subcategory of marketing that blends

elements from psychology, sociology, socio psychology, anthropology and

economics. It attempts to understand the buyer decision making process,

both individually and in groups. It studies characteristics of individual

consumers such as demographics, psychographics, and behavioural

variables in an attempt to understand people's wants. It also tries to

assess influences on the consumer from groups such as family, friends,

reference groups, and society in general.

Consumption is the “process of production, acquisition, utilization and

destruction of goods, services, experiences or places”

Understanding Demographics -

1) Youth – 60% of India’s teens stay in rural area.

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2) Women – Only 23 % house wives in urban areas have jobs outside their

homes

STAGES OF CONSUMER BUYNG PROCESS

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Six Stages to the Consumer Buying Decision Process (For complex

decisions). Actual purchasing is only one stage of the process. Not all

decision processes lead to a purchase. All consumer decisions do not

always include all 6 stages, determined by the degree of

complexity...discussed next.

The 6 stages are:

1. Problem Recognition: The buying process starts with need or

problem recognition—the buyer recognizes a problem or need. The

buyer senses a difference between his or her actual state and some

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desired state. The need can be triggered by internal stimuli when one of

the person's normal needs—hunger, thirst, sex—rises to a level high

enough to become a drive. A need can also be triggered by external

stimuli.

Hunger--Food. Hunger stimulates your need to eat. Can be stimulated by

the marketer through product information--did not know you were

deficient? I.E., see a commercial for a new pair of shoes, stimulates your

recognition that you need a new pair of shoes

At this stage, the marketer should research consumers to find out what

kinds of needs or problems arise, what brought them about, and how

they led the consumer to this particular product.

2. Information search— an aroused consumer may or may not search

for more information. If the consumer's drive is strong and a satisfying

product is near at hand, the consumer is likely to buy it then. If not, the

consumer may store the need in memory or undertake an information

search related to the need. At one level, the consumer may simply enter

heightened attention.

The consumer can obtain information from any of several sources. These

include personal sources (family, friends, neighbors, acquaintances),

commercial sources (advertising, salespeople, dealers, packaging,

displays, Web sites), public sources (mass media, consumer-rating

organizations), and experiential sources (handling, examining, using the

product). The relative influence of these information sources varies with

the product and the buyer. Generally, the consumer receives the most

information about a product from commercial sources—those controlled

by the marketer. The most effective sources, however, tend to be

personal. Commercial sources normally inform the buyer, but personal

sources legitimize or evaluate products for the buyer.

People often ask others—friends, relatives, acquaintances, professionals

—for recommendations concerning a product or service. Thus, companies

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have a strong interest in building such word-of-mouth sources. These

sources have two chief advantages. First, they are convincing: Word of

mouth is the only promotion method that is of consumers, by consumers,

and for consumers. Having loyal, satisfied customers that brag about

doing business with you is the dream of every business owner. Not only

are satisfied customers repeating buyers, but they are also walking,

talking billboards for your business. Second, the costs are low. Keeping

in touch with satisfied customers and turning them into word-of-mouth

advocates costs the business relatively little.

A successful information search leaves a buyer with possible alternatives,

the evoked set. Hungry, want to go out and eat, evoked set is

Chinese food

Indian food

Burger king

3. Evaluation of Alternatives--need to establish criteria for evaluation,

features the buyer wants or does not want. Rank/weight alternatives or

resume search. May decide that you want to eat something spicy, Indian

gets highest rank etc. If not satisfied with your choices then return to the

search phase. Can you think of another restaurant? Look in the yellow

pages etc. Information from different sources may be treated differently.

Marketers try to influence by "framing" alternatives.

4. Purchase decision—In the evaluation stage, the consumer ranks

brands and forms purchase intentions. Generally, the consumer's

purchase decision will be to buy the most preferred brand, but two

factors can come between the purchase intention and the purchase

decision. The first factor is the attitudes of others

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The second factor is unexpected situational factors. The consumer may

form a purchase intention based on factors such as expected income,

expected price, and expected product benefits. However, unexpected

events may change the purchase intention.

5. Purchase--May differ from decision, time lapse between 4 & product

availability

6. Post-Purchase Evaluation--outcome: The marketer's job does not

end when the product is bought. After purchasing the product, the

consumer will be satisfied or dissatisfied and will engage in post

purchase behavior of interest to the marketer. What determines whether

the buyer is satisfied or dissatisfied with a purchase? The answer lies in

the relationship between the consumer's expectations and the product's

perceived performance. If the product falls short of expectations, the

consumer is disappointed; if it meets expectations, the consumer is

satisfied; if it exceeds expectations, the consumer is delighted. The larger

the gap between expectations and performance, the greater the

consumer's dissatisfaction. This suggests that sellers should make

product claims that faithfully represent the product's performance so

that buyers are satisfied. Some sellers might even understate

performance levels to boost consumer satisfaction with the product.

Almost all major purchases result in cognitive dissonance, or discomfort

caused by post purchase conflict. After the purchase, consumers are

satisfied with the benefits of the chosen brand and are glad to avoid the

drawbacks of the brands not bought. However, every purchase involves

compromise. Consumers feel uneasy about acquiring the drawbacks of

the chosen brand and about losing the benefits of the brands not

purchased. Thus, consumers feel at least some postpurchase dissonance

for every purchase.

Why is it so important to satisfy the customer? Such satisfaction is

important because a company's sales come from two basic groups—new

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customers and retained customers. It usually costs more to attract new

customers than to retain current ones, and the best way to retain current

customers is to keep them satisfied. Customer satisfaction is a key to

making lasting connections with consumers—to keeping and growing

consumers and reaping their customer lifetime value. Satisfied customers

buy a product again, talk favorably to others about the product, pay less

attention to competing brands and advertising, and buy other products

from the company. Many marketers go beyond merely meeting the

expectations of customers—they aim to delight the customer. A delighted

customer is even more likely to purchase again and to talk favorably

about the product and company.

A dissatisfied consumer responds differently. Whereas, on average, a

satisfied customer tells 3 people about a good product experience, a

dissatisfied customer gripes to 11 people. In fact, one study showed that

13 percent of the people who had a problem with an organization

complained about the company to more than 20 people. Clearly, bad

word of mouth travels farther and faster than good word of mouth and

can quickly damage consumer attitudes about a company and its

products.

Therefore, a company would be wise to measure customer satisfaction

regularly. It cannot simply rely on dissatisfied customers to volunteer

their complaints when they are dissatisfied. Some 96 percent of unhappy

customers never tell the company about their problem. Companies

should set up systems that encourage customers to complain. In this way,

the company can learn how well it is doing and how it can improve

TYPES OF COMSUMER BUYING BEHAVIOUR :

Types of consumer buying behaviour are determined by:

Level of Involvement in purchase decision. Importance and intensity of

interest in a product in a particular situation. Buyer’s level of

involvement determines why he/she is motivated to seek information

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about a certain products and brands but virtually ignores others. High

involvement purchases--Honda Motorbike, high priced goods, products

visible to others, and the higher the risk the higher the involvement.

Types of risk:

Personal risk

Social risk

Economic risk

The four type of consumer buying behaviour are:

Routine Response/Programmed Behaviour--Buying low involvement

frequently purchased low cost items; need very little search and decision

effort; purchased almost automatically. Examples include soft drinks,

snack foods, milk etc.

COMPLEX BUYING BEHAVIOUR:

Consumers undertake complex buying behavior when they are highly

involved in a purchase and perceive significant differences among

brands. Consumers may be highly involved when the product is

expensive, risky, purchased infrequently, and highly self-expressive.

Typically, the consumer has much to learn about the product category.

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For example, a personal computer buyer may not know what attributes to

consider. Many product features carry no real meaning: a "Pentium Pro

chip," "super VGA resolution," or "megs of RAM."

This buyer will pass through a learning process, first developing beliefs

about the product, then attitudes, and then making a thoughtful purchase

choice. Marketers of high-involvement products must understand the

information-gathering and evaluation behavior of high-involvement

consumers. They need to help buyers learn about product-class attributes

and their relative importance, and about what the company's brand offers

on the important attributes. Marketers need to differentiate their brand's

features, perhaps by describing the brand's benefits using print media

with long copy. They must motivate store salespeople and the buyer's

acquaintances to influence the final brand choice.

DISSONANCE- REDUCING BUYING BEHAVIOUR:

Dissonance-reducing buying behavior occurs when consumers are highly

involved with an expensive, infrequent, or risky purchase, but see little

difference among brands. For example, consumers buying carpeting may

face a high-involvement decision because carpeting is expensive and self-

expressive. Yet buyers may consider most carpet brands in a given price

range to be the same. In this case, because perceived brand differences

are not large, buyers may shop around to learn what is available, but buy

relatively quickly. They may respond primarily to a good price or to

purchase convenience.

After the purchase, consumers might experience post purchase

dissonance (after-sale discomfort) when they notice certain

disadvantages of the purchased carpet brand or hear favorable things

about brands not purchased. To counter such dissonance, the marketer's

after-sale communications should provide evidence and support to help

consumers feel good about their brand choices.

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HABITUAL BUYING BEHAVIOUR:

Habitual buying behavior occurs under conditions of low consumer

involvement and little significant brand difference. For example, take

salt. Consumers have little involvement in this product category—they

simply go to the store and reach for a brand. If they keep reaching for

the same brand, it is out of habit rather than strong brand loyalty.

Consumers appear to have low involvement with most low-cost,

frequently purchased products.

In such cases, consumer behavior does not pass through the usual belief-

attitude-behavior sequence. Consumers do not search extensively for

information about the brands, evaluate brand characteristics, and make

weighty decisions about which brands to buy. Instead, they passively

receive information as they watch television or read magazines. Ad

repetition creates brand familiarity rather than brand conviction.

Consumers do not form strong attitudes toward a brand; they select the

brand because it is familiar. Because they are not highly involved with

the product, consumers may not evaluate the choice even after purchase.

Thus, the buying process involves brand beliefs formed by passive

learning, followed by purchase behavior, which may or may not be

followed by evaluation.

Because buyers are not highly committed to any brands, marketers of

low-involvement products with few brand differences often use price and

sales promotions to stimulate product trial. In advertising for a low-

involvement product, ad copy should stress only a few key points. Visual

symbols and imagery are important because they can be remembered

easily and associated with the brand. Ad campaigns should include high

repetition of short-duration messages. Television is usually more effective

than print media because it is a low-involvement medium suitable for

passive learning. Advertising planning should be based on classical

conditioning theory, in which buyers learn to identify a certain product

by a symbol repeatedly attached to it.

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Marketers can try to convert low-involvement products into higher-

involvement ones by linking them to some involving issue. Procter &

Gamble does this when it links Crest toothpaste to avoiding cavities. Or

the product can be linked to some involving personal situation. Nestlé did

this in its series of ads for Taster's Choice coffee, each consisting of a

new soap-opera-like episode featuring the evolving romantic relationship

between two neighbors. At best, these strategies can raise consumer

involvement from a low to a moderate level. However, they are not likely

to propel the consumer into highly involved buying behavior.

VARIETY SEEKING BUYING BEHAVIOUR:

Consumers undertake variety-seeking buying behavior in situations

characterized by low consumer involvement but significant perceived

brand differences. In such cases, consumers often do a lot of brand

switching. For example, when buying cookies, a consumer may hold some

beliefs, choose a cookie brand without much evaluation, then evaluate

that brand during consumption. But the next time, the consumer might

pick another brand out of boredom or simply to try something different.

Brand switching occurs for the sake of variety rather than because of

dissatisfaction.

In such product categories, the marketing strategy may differ for the

market leader and minor brands. The market leader will try to encourage

habitual buying behavior by dominating shelf space, keeping shelves fully

stocked, and running frequent reminder advertising. Challenger firms

will encourage variety seeking by offering lower prices, special deals,

coupons, free samples, and advertising that presents reasons for trying

something new.

Factors Affecting the Consumer Buying Decision Process

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A consumer, making a purchase decision will be affected by the following

four factors:

1. Cultural and sub culture Factor

2. Social Factor

3. Personal Factor

4. Psychological

1. Culture and Sub-culture

Culture refers to the set of values, ideas, and attitudes that are accepted

by a homogenous group of people and transmitted to the next generation.

Culture also determines what is acceptable with product advertising.

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Culture determines what people wear, eat, reside and travel. Cultural

values in the US are good health, education, individualism and freedom.

In American culture time scarcity is a growing problem that is change in

meals. Big impact on international marketing. Culture can be divided into

subcultures: Geographic regions

Human characteristics such as ethnic background.

Culture affects what people buy, how they buy and when they buy.

2. Social Factors

Consumer wants, learning, motives etc. are influenced by opinion

leaders, person's family, reference groups, social class and culture.

Roles and Family Influences--

Role...things you should do based on the expectations of you from your

position within a group. People have many roles. Husband, father,

employer, employee. Individuals role are continuing to change therefore

marketers must continue to update information. Family is the most basic

group a person belongs to. Marketers must understand: that many family

decisions are made by the family unit consumer behaviour starts in the

family unit family roles and preferences are the model for children's

future family (can reject/alter/etc) family buying decisions are a mixture

of family interactions and individual decision making. Family acts an

interpreter of social and cultural values for the individual.

The Family life cycle: families go through stages; each stage creates

different consumer demands

Family members can strongly influence buyer behavior. The family is the

most important consumer buying organization in society, and it has been

researched extensively. Marketers are interested in the roles and

influence of the husband, wife, and children on the purchase of different

products and services.

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Husband-wife involvement varies widely by product category and by

stage in the buying process. Buying roles change with evolving consumer

lifestyles. In the United States, the wife traditionally has been the main

purchasing agent for the family, especially in the areas of food,

household products, and clothing. But with 70 percent of women holding

jobs outside the home and the willingness of husbands to do more of the

family's purchasing, all this is changing. For example, women now buy

about 45 percent of all cars and men account for about 40 percent of

food-shopping dollars.

Such changes suggest that marketers who've typically sold their products

to only women or only men are now courting the opposite sex. For

example, with research revealing that women now account for nearly half

of all hardware store purchases, home improvement retailers such as

Home Depot and Builders Square have turned what once were

intimidating warehouses into female-friendly retail outlets. The new

Builders Square II outlets feature decorator design centers at the front of

the store. To attract more women, Builders Square runs ads targeting

women in Home, House Beautiful, Woman's Day, and Better Homes and

Gardens. Home Depot even offers bridal registries

Children may also have a strong influence on family buying decisions.

Chevrolet recognizes these influences in marketing its Chevy Venture

minivan. For example, it ran ads to woo these "back-seat consumers" in

Sports Illustrated for Kids, which attracts mostly 8- to 14-year-old boys.

"We're kidding ourselves when we think kids aren't aware of brands,"

says Venture's brand manager, adding that even she was surprised at

how often parents told her that kids played a tie-breaking role in

deciding which car to buy.

Groups

A person's behavior is influenced by many small groups. Groups that

have a direct influence and to which a person belongs are called

membership groups. In contrast, reference groups serve as direct (face-

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to-face) or indirect points of comparison or reference in forming a

person's attitudes or behavior. People often are influenced by reference

groups to which they do not belong. For example, an aspirational group

is one to which the individual wishes to belong, as when a teenage

basketball player hopes to play someday for the Utah Jazz. Marketers try

to identify the reference groups of their target markets. Reference

groups expose a person to new behaviors and lifestyles, influence the

person's attitudes and self-concept, and create pressures to conform that

may affect the person's product and brand choices.

The importance of group influence varies across products and brands. It

tends to be strongest when the product is visible to others whom the

buyer respects. Manufacturers of products and brands subjected to

strong group influence must figure out how to reach opinion leaders—

people within a reference group who, because of special skills,

knowledge, personality, or other characteristics, exert influence on

others.

Reference Groups--

Individual identifies with the group to the extent that he takes on many

of the values, attitudes or behaviours of the group members.

Families, friends, sororities, civic and professional organizations. Any

group that has a positive or negative influence on a person’s attitude and

behaviour.

Membership groups

(Belong to) Affinity marketing is focused on the desires of consumers that

belong to reference groups. Marketers get the groups to approve the

product and communicate that approval to its members. Credit Cards

etc.!!

Aspiration groups

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(Want to belong to) Disassociate groups (do not want to belong to)

Honda tries to disassociate from the "biker" group. The degree to which

a reference group will affect a purchase decision depends on an

individual’s susceptibility to reference group influence and the strength

of his/her involvement with the group.

Social Class

An open group of individuals who have similar social rank. US is not a

classless society. US criteria; occupation, education, income, wealth,

race, ethnic groups and possessions. Social class influences many aspects

of our lives. i.e.; upper middle class Americans prefer luxury cars

Mercedes.

Upper-upper class, .3%, inherited wealth, aristocratic names .Upper

uppers are the social elite who live on inherited wealth and have well-

known family backgrounds. They give large sums to charity, run

debutante balls, own more than one home, and send their children to the

finest schools. They are a market for jewelry, antiques, homes, and

vacations. They often buy and dress conservatively rather than showing

off their wealth. Although small in number, upper uppers serve as a

reference group for others.

Lower-upper class, 1.2%, newer social elite, from current professionals

and corporate elite.

Lower uppers have earned high income or wealth through exceptional

ability in the professions or business. They usually begin in the middle

class. They tend to be active in social and civic affairs and buy for

themselves and their children the symbols of status, such as expensive

homes, schools, swimming pools, and automobiles. They include the new

rich who consume conspicuously to impress those below them. They want

to be accepted in the upper-upper stratum, a status more likely to be

achieved by their children than by themselves.

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Upper-middle class, 12.5%, college graduates, managers and

professionals

Upper middles possess neither family status nor unusual wealth. They

are primarily concerned with "career," They have attained positions as

professionals, independent businesspersons, and corporate managers.

They believe in education and want their children to develop professional

or administrative skills. They are joiners and highly civic-minded. They

are the quality market for good homes, clothes, furniture, and appliances.

Middle class, 32%, average pay white collar workers and blue collar

friends.

The middle class is made up of average-pay white- and blue-collar

workers who live on "the better side of town" and try to "do the proper

things." To keep up with the trends, they often buy products that are

popular. Most are concerned with fashion, seeking the better brand

names. Better living means owning a nice home in a nice neighborhood

with good schools. They believe in spending more money on worthwhile

experiences for their children and aiming them toward a college

education.

Working class, 38%, average pay blue collar workers.

The working class consists of those who lead a "working-class lifestyle,"

whatever their income, school background, or job. They depend heavily

on relatives for economic and emotional support, for advice on

purchases, and for assistance in times of trouble. The working class

maintains sharper sex role division and stereotyping.

Lower class, 9%, working, not on welfare

Upper lowers are working (are not on welfare), although their living

standard is just above poverty. They perform unskilled work for very poor

pay although they strive toward a higher class. Often, upper lowers lack

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education. Although they fall near the poverty line financially, they

manage to "present a picture of self-discipline" and "maintain some effort

at cleanliness."

Lower-lower class, 7%, on welfare

Lower lowers are on welfare, visibly poverty stricken, and usually out of

work or have "the dirtiest jobs." Often they are not interested in finding a

job and are permanently dependent on public aid or charity for income.

Their homes, clothes, and possessions are "dirty," "raggedy," and

"broken-down."

Social class determines to some extent, the types, quality, and quantity of

products that a person buys or uses. Lower class people tend to stay

close to home when shopping; do not engage in much pre-purchase

information gathering.

Stores project definite class images.

Family, reference groups and social classes are all social influences on

consumer behaviour. All operate within a larger culture.

Celebrity Influence

This is an important tool which is able to influence Indian consumer

buying behaviour. In India, celebrities are being increasingly used in

marketing communication by marketers to lend personality to their

products. With the visual media becoming more popular the use of

celebrities in the TV media has increased. Celebrities create headlines.

Their activities and movements are being closely watched and imitated.

What they endorse sell like hot cakes. It is not surprising therefore that

using celebrities in advertisements has become common practice. In

India especially, it is not difficult to look for the reasons as to why

companies are increasingly using celebrities. Indians always love their

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heroes and heroines. Consumers like advertisements more if they are

admirers of the celebrities in the advertisements. When a consumer likes

the celebrity in the advertisement, he or she is more likely to accept what

the celebrity says about the advertised product and therefore will

develop more positive feelings toward the advertisement and the brand

itself. Famous celebrities are able to attract attention and retain

attention by their mere presence in the advertisement

In the midst of the advertisement clutter, the advertisements that

celebrities endorse also achieve high recall rates. When people see their

favoured reference group members or celebrities in the advertisements,

they pay more attention to them.

Celebrities may also help reposition products. Products with sagging

sales needs some boosting and in these Indian celebrities can help by

way of the endorsing the product concerned.

Personal factors

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Ability and Knowledge—

Need to understand individual’s capacity to learn. Learning, changes in a

person's behaviour caused by information and experience. Therefore to

change consumers' behaviour about your product, need to give them new

information re: product...free sample etc. When making buying decisions,

buyers must process information.

Knowledge is the familiarity with the product and expertise.

Inexperience buyers often use prices as an indicator of quality more than

those who have knowledge of a product. Non-alcoholic Beer example:

consumers chose the most expensive six-pack, because they assume that

the greater price indicates greater quality.

Learning is the process through which a relatively permanent change in

behaviour results from the consequences of past behaviour.

•

Attitudes--

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Knowledge and positive and negative feelings about an object or activity-

maybe tangible or intangible, living or non living.....Drive perceptions

Individual learns attitudes through experience and interaction with other

people. Consumer attitudes toward a firm and its products greatly

influence the success or failure of the firm's marketing strategy. Honda

"You meet the nicest people on a Honda” dispels the unsavoury image of

a motorbike rider, late 1950s. Changing market of the 1990s, baby

boomers aging, Hondas market returning to hard core. To change this

they have a new slogan "Come ride with us". Attitudes and attitude

change are influenced by consumer’s personality and lifestyle.

Consumers screen information that conflicts with their attitudes. Distort

information to make it consistent and selectively retain information that

reinforces our attitudes. IE brand loyalty. There is a difference between

attitude and intention to buy (ability to buy)

Personality-- all the internal traits and behaviours that make a person

unique, uniqueness arrives from a person's heredity and personal

experience. Examples include:

Work holism

Compulsiveness

Self confidence

Friendliness

Adaptability

Ambitiousness

Introversion

Extroversion

Aggressiveness

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Competitiveness

Traits affect the way people behave. Marketers try to match the store

image to the perceived image of their customers.

There is a weak association between personality and Buying Behaviour;

this may be due to unreliable measures. Nike ads. Consumers buy

products that are consistent with their self concept.

Lifestyles--

People coming from the same subculture, social class, and occupation

may have quite different lifestyles. Lifestyle is a person's pattern of living

as expressed in his or her psychographics. It involves measuring

consumers' major AIO dimensions—activities (work, hobbies, shopping,

sports, social events), interests (food, fashion, family, recreation), and

opinions (about themselves, social issues, business, products). Lifestyle

captures something more than the person's social class or personality. It

profiles a person's whole pattern of acting and interacting in the world.

Several research firms have developed lifestyle classifications. The most

widely used is the SRI Consulting's Values and Lifestyles (VALS) y

typology (see Figure 5.3). VALS classifies people according to how they

spend their time and money. It divides consumers into eight groups

based on two major dimensions: self-orientation and resources. Self-

orientation groups include principle-oriented consumers who buy based

on their views of the world; status-oriented buyers who base their

purchases on the actions and opinions of others; and action-oriented

buyers who are driven by their desire for activity, variety, and risk

taking. Consumers within each orientation are further classified into

those with abundant resources and those with minimal resources,

depending on whether they have high or low levels of income, education,

health, self-confidence, energy, and other factors. Consumers with either

very high or very low levels of resources are classified without regard to

their self-orientations (actualizers, strugglers). Actualizers are people

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with so many resources that they can indulge in any or all self-

orientations. In contrast, strugglers are people with too few resources to

be included in any consumer orientation

Economic Situation

A person's economic situation will affect product choice. Anna Flores can

consider buying an expensive Nikon if she has enough spendable income,

savings, or borrowing power. Marketers of income-sensitive goods watch

trends in personal income, savings, and interest rates. If economic

indicators point to a recession, marketers can take steps to redesign,

reposition, and reprice their products closely.

4. Psychological factors

A person's buying choices are further influenced by four major

psychological factors: motivation, perception, learning, and beliefs and

attitudes.

Motivation

A person has many needs at any given time. Some are biological, arising

from states of tension such as hunger, thirst, or discomfort. Others are

psychological, arising from the need for recognition, esteem, or

belonging. Most of these needs will not be strong enough to motivate the

person to act at a given point in time. A need becomes a motive when it is

aroused to a sufficient level of intensity. A motive (or drive) is a need that

is sufficiently pressing to direct the person to seek satisfaction.

Psychologists have developed theories of human motivation. Two of the

most popular—the theories of Sigmund Freud and Abraham Maslow—

have quite different meanings for consumer analysis and marketing.

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Perception

A motivated person is ready to act. How the person acts is influenced by

his or her own perception of the situation. All of us learn by the flow of

information through our five senses: sight, hearing, smell, touch, and

taste. However, each of us receives, organizes, and interprets this

sensory information in an individual way. Perception is the process by

which people select, organize, and interpret information to form a

meaningful picture of the world.

People can form different perceptions of the same stimulus because of

three perceptual processes: selective attention, selective distortion, and

selective retention. People are exposed to a great amount of stimuli every

day. For example, the average person may be exposed to more than

1,500 ads in a single day. It is impossible for a person to pay attention to

all these stimuli. Selective attention—the tendency for people to screen

out most of the information to which they are exposed—means that

marketers have to work especially hard to attract the consumer's

attention.

Even noted stimuli do not always come across in the intended way. Each

person fits incoming information into an existing mind-set. Selective

distortion describes the tendency of people to interpret information in a

way that will support what they already believe. Selective distortion

means that marketers must try to understand the mind-sets of consumers

and how these will affect interpretations of advertising and sales

information.

People also will forget much that they learn. They tend to retain

information that supports their attitudes and beliefs. Because of selective

retention, Anna is likely to remember good points made about the Nikon

and to forget good points made about competing cameras. Because of

selective exposure, distortion, and retention, marketers have to work

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hard to get their messages through. This fact explains why marketers use

so much drama and repetition in sending messages to their market.

Learning

When people act, they learn. Learning describes changes in an

individual's behavior arising from experience. Learning theorists say that

most human behavior is learned. Learning occurs through the interplay

of drives, stimuli, cues, responses, and reinforcement.

We saw that Anna Flores has a drive for self-actualization. A drive is a

strong internal stimulus that calls for action. Her drive becomes a motive

when it is directed toward a particular stimulus object, in this case a

camera. Anna's response to the idea of buying a camera is conditioned by

the surrounding cues. Cues are minor stimuli that determine when,

where, and how the person responds.

Beliefs and Attitudes

Through doing and learning, people acquire beliefs and attitudes. These,

in turn, influence their buying behavior. A belief is a descriptive thought

that a person has about something. Anna Flores may believe that a Nikon

camera takes great pictures, stands up well under hard use, and costs

$450. These beliefs may be based on real knowledge, opinion, or faith,

and may or may not carry an emotional charge. For example, Anna

Flores's belief that a Nikon camera is heavy may or may not matter to

her decision.

Marketers are interested in the beliefs that people formulate about

specific products and services, because these beliefs make up product

and brand images that affect buying behavior. If some of the beliefs are

wrong and prevent purchase, the marketer will want to launch a

campaign to correct them.

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People have attitudes regarding religion, politics, clothes, music, food,

and almost everything else. Attitude describes a person's relatively

consistent evaluations, feelings, and tendencies toward an object or idea.

Attitudes put people into a frame of mind of liking or disliking things, of

moving toward or away from them. Thus, Anna Flores may hold attitudes

such as "Buy the best," "The Japanese make the best products in the

world," and "Creativity and self-expression are among the most important

things in life." If so, the Nikon camera would fit well into Anna's existing

attitudes.

Attitudes are difficult to change. A person's attitudes fit into a pattern,

and to change one attitude may require difficult adjustments in many

others. Thus, a company should usually try to fit its products into existing

attitudes rather than attempt to change attitudes

Noodles History:

Noodles can be regarded as the second staple after rice in Asian

countries. The great thing about noodles is that they can be prepared in

various combinations; with sauces, in soup, fried, with all kinds of meat,

seafood and vegetables. When compared to rice, noodle meals are

cheaper and more convenient. A great deal of time can be saved in the

preparing, consuming and dish washing processes. Therefore, despite its

ancient origins, it is highly suited to the fast beat of modern society.

The traditional Chinese noodle stalls in Hong Kong has changed little

over half a century. Like many traditional Chinese businesses, these were

usually run by a family, (typically the father acts as the cook and master,

the mother the cashier, and their children as waiters/ waitresses).

Although the management of these stalls can be very flexible, they lack of

control on the quality of food and customer service. Moreover, they do

little to promote their shop image. The staffs seldom wear uniform, and

little attention is paid to food hygiene and the shop interior. Some stalls

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have pets strolling around and some don't even have air conditioning.

Usually the menu is only in Chinese language, which is placed either

under the greasy table glass top or pasted along the walls.

The target customers are usually people in their neighbourhood and the

business relied mainly on the low price strategies, or by word of mouth.

The way in which the noodle is cooked is the crucial factor on getting

return business. However, since the current generations of young people

nowadays are able to receive higher education, they will not be eager to

inherit their father's business. Given that running a noodle stall is not

considered as a particular prestigious and well-paid job. Therefore when

the master retires, he must pass on his technique to someone outside the

family. It is a customary practice though for Chinese chefs not to pass on

everything. Therefore, there is bound to be changes to the quality of the

food once the business has changed hands.

The Japanese noodle shops on the other hand are better organized. In the

shop front, there is usually a display window showing wax models of

different set meals. The wax models can imitate the food so successfully

that it provides a mouth-watering image to the passerby. When one walks

into the shop, he will be greeted politely by trained waitresses either

wearing apron or some sort of uniform. The shop interior is carefully

design to reflect Japanese culture and is always clean and hygienic. The

menu is supplemented by some very attractive photographs. So that

customer can be assured what they order will match their expectations,

even if they cannot read the menu correctly.

As the living standard of people in Hong Kong improves, their

requirement on food is no longer just to fill the stomach. The target

customers of Japanese noodles are usually the young generation and

office workers. They are less price conscious and are willing to pay more

for better food quality, service and eating environment. Although a bowl

of noodle sold in a Japanese noodle shop could be at least three times

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higher than those sold in a Chinese noodle stall, many people still think

that it is worth the money.

MAGGI

INTRODUCTION

Ever since its launch in India in 1983, this brand has become

synonymous with noodles. The bright red and yellow colours of the

packet with the brilliant blue “2-minute Noodles” printed on it has found

a place on every kitchen. Over the years, Maggi has grown as a brand

and positioned itself as a “Fast to cook! Good to Eat! “Food product. The

history of this brand traces back to the 19th century when industrial

revolution in Switzerland created factory jobs for women, who were

therefore left with very little time to prepare meals. Due to this growing

problem Swiss Public Welfare Society asked a miller named Julius Maggi

to create a vegetable food product that would be quick to prepare and

easy to digest. Julius, the son of an Italian immigrant came up with a

formula to bring added taste to meals in 1863. Soon after he was

commissioned by the Swiss Public Welfare Society, he came up with two

instant pea soups & a bean soup- the first launch of Maggi brand of

instant foods in 1882-83.Towards the end of the century, Maggi company

was producing not just powdered soups, but bouillon cubes, sauces and

other flavourings.

However in India (the largest consumer of Maggi noodles in the world!) it

was launched in 1980 by Nestle group of companies. Maggie had merged

with Nestle family in 1947. When launched it had to face a stiff

competition from the ready to eat snack segments like biscuits, wafers

etc. Also it had other competitor the so called home made snacks which

are till today considered healthy and hygienic. Hence to capture the

market it was positioned as a hygienic homemade snack, a smart move.

But still this didn’t work, as it was targeted towards the wrong target

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group, the working women. After conducting an extensive research, the

firm found that the children were the biggest consumers of Maggi

noodles. Quickly a strategy was developed to capture the kids segment

with various tools of sales promotion like pencils, fun books, Maggi clubs

which worked wonders for it. No doubt the ads of Maggi have shown a

hungry kid saying “Mummy bhookh lagi hai” to which his mom replies

“Bas do minute!” and soon he is happily eating Maggie noodles. Further

the MAGGI 2-MINUTE Noodles has been renovated to provide 20% of the

RDA1 of Calcium and Protein for the core target group building on the

nutrition proposition

“Taste bhi health bhi”. The company could have easily positioned the

product as a meal, but did not, as a study had shown that Indian

mentality did not accept anything other than rice or roti as meal. They

made it an easy to cook snack that could be prepared in just two minutes.

The formula clicked well and Maggi became a brand name

Nestlé’s Maggie noodles are the leading brand in the instant noodles

segment in India, enjoying a market share of 79.3%. The brand has

grown to an estimated Rs 200 crores & contributes to around 10% of

Nestle India’s top line. Being the pioneer in the noodles market has given

it a first mover’s advantage over other brands. Maggi has regularly come

up with new flavours and has recently launched two variants- Vegetable

Atta and Dal Atta noodles, catering to the increasing demand for healthy

snacks.

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COMPANY PROFILE

NESTLE’ Nestle India

Nestle’ India is a subsidiary of Nestle’ S.A. of Switzerland. The company

insists on honesty, integrity and fairness in all aspects of its business and

expects the same in its relationships.

Nestle India- Presence across India

Beginning with its first investment in Moga in 1961, Nestlé’s regular and

substantial investments established that it was here to stay. In 1967,

Nestlé set up its next factory at Choladi (Tamil Nadu) as a pilot plant to

process the tea grown in the area into soluble tea. The Nanjangud factory

(Karnataka), became operational in 1989, the Samalkha factory

(Haryana), in 1993 and in 1995 and 1997, Nestlé commissioned two

factories in Goa at Ponda and Bicholim respectively. Nestlé India is now

putting up the 7th factory at Pant Nagar in Uttaranchal.

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Nestle’ Story

Nestlé was founded in 1867 on the shores of Lake Geneva in Vevey,

Switzerland and its first product was “Farine Lactée Nestlé”, an infant

cereal specially formulated by Henri Nestlé to provide and improve infant

nutrition. From its first historic merger with the Anglo-Swiss Condensed

Milk Company in 1905, Nestlé has grown to become the world’s largest

and most diversified food Company, and is about twice the size of its

nearest competitor in the food and beverage sector.

Nestlé’s trademark of birds in a nest, derived from Henri Nestlé’s

personal coat of arms, evokes the values upon which he founded his

Company. Namely, the values of security, maternity and affection, nature

and nourishment, family and tradition. Today, it is not only the central

element of Nestlé’s corporate identity but serves to define the Company’s

products, responsibilities, business practices, ethics and goals.

In 2004, Nestlé had around 247,000 employees worldwide, operated 500

factories in approx. 100 countries and offered over 8,000 products to

millions of consumers universally. The Company’s transparent business

practices, pioneering environment policy and respect for the fundamental

values of different cultures have earned it an enviable place in the

countries it operates in. Nestlé’s activities contribute to and nurture the

sustainable economic development of people, communities and nations.

Above all, Nestlé is dedicated to bringing the joy of ‘Good Food, Good

Life’ to people throughout their lives, throughout the world.

Nestle’ Brands

Milk Products & Nutrition

Beverages

Prepared Dishes and Cooking Aids

Chocolates & Confectionary

A Maggi noodle is a brand of instant noodles manufactured by Nestlé.

The brand is popular in Australia, India, South Africa, Brazil, Nepal, New

Zealand, Malaysia, Singapore, Sri Lanka, Bangladesh, Pakistan, and the

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Philippines. In several countries, it is also known as "Maggi mee" (mee is

Indonesian/Malay for noodles). Maggi noodles are part of the Maggi

family, a Nestlé brand of instant soups, stocks, and noodles. In Malaysia,

there are fried noodles made from Maggi noodles known as Maggi

goreng. Maggi noodles recently introduced a new variety of its noodles,

to cater for the health conscious like 'No MSG', 'Less Salt', and 'No Trans

fat'. Whole-wheat flour based noodle variation marketed by the name

"Vegetable Atta Noodles" has been introduced in India (Atta flour is used

in preparing most forms of wheat based breads in India) and caters to

health conscious buyers wary of the refined flour used in the regular

Maggi noodles. This move helps the brand in India as suburban mothers,

who feed the noodles to children as an afterschool snack, are the primary

customers of the brand. Recently, a line of rice noodles and whole wheat

with pulses, carrots, beans, and onions has also been introduced in India.

In fact, "Maggi" has become a well-known brand for instant noodles in

India and Malaysia.

Nestlé India Ltd (NIL) offered a variety of culinary products such as

instant noodles, soups, sauces and ketchups, cooking aids (seasonings),

etc., under the Maggi brand (Refer to Exhibit II for Maggi's product

portfolio as of mid-2006). Of these, instant noodles had been NIL's main

product category in the culinary segment since the launch of Maggi 2

Minute Noodles (Maggi noodles) in 1982. Over the years, Maggi noodles

became a popular snack food product in India.

In mid 2008, New Zealand supermarkets introduced replacement

formulations for its Beef, Oriental, and Curry flavours. A new feature is

an extra sachet containing dehydrated vegetables. Maggi claims the new

range contains 88% less total fat and 86% less saturated fat than the

average of top-three (unnamed) 2-minute-noodle competitors. The new

Maggi range also has considerably lower fat than its own previous

formulation. However, the salt content has been increased by 31 percent.

Consumers have not reacted well to the new formulations, complaining

that they want the original chicken flavour back Claimed to be "2 minute

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noodles", The Maggi noodle cake and seasoning is added into boiling

water for two minutes and it is ready for consumption. Egg, seaweed,

boiled vegetables or lemon can also be added to the noodles for a better

flavour.

Market Summary

TARGET MARKETS

Primary target: Children (<16)

Nestle plans to widen its target audience by launching new variants

Vegetable and Dal atta, Multi grain noodles for health conscious people.

MARKET DEMOGRAPHICS

Demographics:

Region: urban, semi-urban, rural (recent)

Occupation: Housewives, working professionals, self-employed

Sex: Unisex

Income: 1, 20,000 p.a. upwards

Social class: Middle and upwards

Family life cycle: Young, single, married with children.

Behavioural:

Occasions: Regular, Everyday user-urban, rural-depends on the temporal

aspects of the consumer’s life (varied usage in terms of time of time of

day, week, month, year)

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User status: first time user-rural, potential users-semi-urban, heavy

users-urban

Usage rate: Heavy user-urban, light-rural, medium-semi-urban

Loyalty status: hard core and shifting loyal

Buyer-Readiness Stage: rural-some are aware, semi-urban: some intend

to buy (aware, informed), urban: informed (some desire, some intend to

buy)

Attitude toward product: Enthusiastic, positive.

Psychographics:

Lifestyle: Hard pressed for time

CHILDREN

Children as an age group are a marketer’s delight. With “pester power”

children play a significant role in decision making and purchase choices

of just about anything ranging from food items to beverages to

chocolates. As consumers, children know exactly what they want and do

not experiment too much with flavour or colour.

Children rule

Indian families consider children to precious gifts of God, and parents in

all income groups do all they can for their offspring. Indian parents are

still not completely comfortable with paid baby sitters or day care help

and use the larger extended family or friends to help with care and

supervision of children.

Rush for pre-school admissions

Throughout urban India, parents of nursery age children are looking to

send them in the best private school they can afford. Pre-schools for

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toddlers in the 2-3 age group are mushrooming all over the country, as

anxious parents recognise the perceived benefits these can bring.

TEENAGERS

The teenager’s age group consists of children on the threshold of

adolescence and as a segment are a difficult lot. Though they are not

sure about their choices on an emotional plane, they are a trendy new

group that is extremely savvy and self assured when it comes to taking

decisions regarding consumer goods and wants. Urban children in this

age group would have some amount of pocket money with an upper limit

of Rs100 per month. Though allowances have gone up, parental control

still exists over this market segment. Impulse foods rule the preference

scale as far as the buying behaviour of teenagers in India is concerned.

In fact, the top six expense items for teenagers seem to be impulse foods:

17% of the total pocket money spent on ice creams, 12% on chocolates

and 10% each on soft drinks and fast food according to a newspaper

report in the “The Times of India”.

A key role to play in decision making

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With increased awareness through television and advertising, teenagers

are an important influence on family decision-making in urban India.

They have also mastered the art of nagging their parents into making

purchases of gadgets or products that they want. Among the areas where

they make their influence felt are the purchase of such items as a newly

launched chocolate bar, instant noodles and breakfast cereal.

With a penchant for hi-tech and an ease with new technology far superior

to their parents, these teenagers are more familiar with operating mobile

phones, the TV remote, DVD player and computer programmes, as well

as the product features.

Cricket-crazy boys

Cricket is the obsession and passion of boy teenagers in India. This

interest cuts across income and socio-economic groups. Low income boys

will play on the streets with makeshift bats and stumps, middle-income

children can be seen playing in gardens and at school, while boys from

more well-to-do families go and play in organised coaching camps. With

their education demanding less time at this age, parents are generally

quite happy to see their boys spending so much time on cricket

STUDYING AGE

A rise in the number of colleges and institutions of higher learning both

government owned and privately financed has enabled a larger number

of youth to graduate from their portals.

This population grew since 2000 but is set to stagnate in the forecast

period with couples actually postponing the child bearing decision and

some even rejecting the idea of having one at all. This age group has

taken up to snacking as a way of life as they keep missing regular meals

due to erratic schedules. They have longer waking hours and due to this

the traditional three meals does not suffice with the need for filling

snacks.

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Rising financial freedom

With growing aspirations on the academic front and shrinking global

boundaries this age group has an unquenchable thirst for information

whether through their PCs or cell phones.

With a rise in employment opportunities in the Business Process

Outsourcing (BPO) sector, more and more consumers in this age group

are juggling jobs along with their studies for the sake of the financial

freedom it gives them.

Summer jobs

Until the 1990s, summer vacations were a time to relax, read and catch

up with friends. This is no longer the case. Now, teenagers either find a

summer job, or undertake activities such as a trek in the mountains, river

rafting or rock climbing. Summer jobs may cover a range of activities

from delivering newspapers to working in a restaurant

YOUNG ADULTS

Young adults (15-29 years old) represent the largest spending segment in

the country. Youngsters are part of a middle-class boom in India. Of the

US$30 billion spent by Indians on themselves in 2003, young adults spent

close to US$10.5 billion with their spending levels.

Need for convenience

Many single working professionals have to live away rising 12% each

year at twice the pace of the economy’s growth according to various

trade press publications. Young adults grew 8% in numbers over the

1999-2004 periods and are likely to grow at approximately the same

pace.

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Rising disposable incomes

College graduates and students still studying are landing well-paying

jobs in a host of

Emerging industries that barely existed at the start of the new

millennium – retail chains, fast food restaurants, mobile phone

companies, call centres and data processing firms. Many have access to

disposable incomes of Rs8, 000-10,000 per month thanks to the BPO

boom in India.

This age group still does not have responsibilities of running a household,

marriage or worry about their children’s education. Thus, this income is

almost entirely spent on non-essential items. Most purchases made by

this age group are on impulse. There are 16 million urban consumers in

the 20-25 age groups. From their parents due to the demand of the jobs.

This yuppies (young upwardly mobile professionals) class has a hard time

preparing food and for them convenience is major issue. They are ready

to pay a premium for quality and convenience. Also always being on the

move they have a need for food item that can be easily consumed and

disposed of

MIDDLE-AGED ADULTS

These middle aged men have strict preferences over food and they

generally stick to their choices. They experiment less and go for products

that will enhance their social status. The women in this age group are

ones who the primarily buy food items for the entire household though

their choices are shaped by the preferences of the household members.

The women in this segment play an important role as most of the choices

of food items have to pass their scrutiny before it is consumed in the

household.

Responsibilities

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Between the ages of 45 and 55, men find themselves with children who

are able to leave school or facing crucial board examinations. Some may

also have wives with settled careers. These factors make them reluctant

to leave or move from their city of residence and they would rather

resign and move to another job rather than displace the family. Others

find themselves redundant in the new hire and fire labour environment.

There is a trend for such people to enter the BPO sector as well

Mid-life career change

In urban India, among the middle class, there are a significant number of

men who are making career switches, some out of choice and others out

of necessity. Tired of their current salaried jobs, some are taking the

entrepreneurial plunge, setting up businesses such as small IT- service

firms, adventure tourism companies or leadership training consultancies.

PENSIONERS

In the 1950s and 1960s, government jobs were among the few acceptable

job occupations for people from respectable households. Changing

technology and globalisation have changed that with unconventional

income opportunities now presenting themselves to Indians. Some

pensioners have sought and enjoyed success in information technology-

related endeavours whilst others have put their considerable English

language skills to good use in service industries. Pensioners have been

the hardest hit section of the population. With declining interest rates,

they have had to play a more active role in financial management. Some

of them are even trying to keep abreast of current happenings and

learning how to use a computer or access the Internet.

There food preferences are shaped by their health conditions and they

stick to their preferred food items.

Independent living on the rise

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From the 1980s onwards, there has been a steady migration of young

adults and students to the US, in search of better opportunities. Most

have chosen to settle and make their lives in that country. Therefore,

their ageing parents have had to learn to continue to live independently.

Retirement communities viewed as an option

Retirement homes were previously viewed negatively in India. If the

elderly went there, it meant they had no one to care for them, and were

in a sense for the destitute elderly. In the new urban India, however,

well-appointed retirement communities are mushrooming, and couples in

their 60s are going there of their own volition.

While the numbers are not yet significant, a trend is likely to increase in

line with growth in the numbers of India’s elderly. It is also now an

option for the middle-income and salaried classes. In families where

there is a proprietary business, or a family practice, two-to-three

generations will continue to live together.

MARKET NEEDS

The urban Indian is used to having his dinner late from around 8:30 pm

to as late as 11 pm.

Hence a convenient snack between lunch and dinner is an often

exercised option. In rural areas, smaller priced packs stimulate demand.

Maggi is a fun and convenience brand which sits strongly in its position

as a "good to eat, fast to cook" anytime snack and is popular across

different age groups. Opportunities in practically all consumption

categories arise in terms of "reach" and "medium of consumption". Hence

the onus is on the company to make it easily available and affordable and

in different sizes, catering to different categories of users like the new

Maggi chota pack conveniently priced at Rs 5 for 50gms. The Indian

palate is not too adventurous in terms of trying out new flavours. In fact

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today, Maggi have settled at standard flavours such as curry, masala,

tomato and chicken and not much experimentation is necessarily

required in the noodles market. People prefer to have it easily available

and affordable.

MARKET TRENDS

The FMCG market is set to treble from US$ 11.6 billion in 2003 to US$

33.4 billion

in 2015. Penetration level is only 30% for Maggi Noodles in urban areas

as well as per capita consumption for the Instant noodles and pasta

segment is low indicating the untapped market potential

The BRICs report indicates that India's per capita disposable income,

currently at

US$ 556 per annum will raise to US$ 1150 by 2015 -another demand

driver. Spurt in

The industrial and services sector growth is also likely to boost the urban

consumption demand.

Only about 8-10 per cent of output is processed and consumed in

packaged form, thus highlighting the huge potential for expansion of this

industry. Currently, the semi processed and ready to eat packaged food

segment has a size of over US$ 70 billion and is growing at 15 per cent

per annum.

FICCI Federation of Indian Chambers of Commerce and Industry has

predicted an

overall growth of culinary products/snack food (10%).

MARKET GROWTH

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General growth of the Indian Noodles sector FY 2005-2006

FICCI states that the culinary products and snack category, under which

Maggi

noodles is classified, has had a robust growth of 8%.

Growing by a more than robust 21% in current value and 16% in volume,

growth in

noodles will be among the fastest in the various packaged food products

in India.

(Refer Appendix A: Indian Instant Noodle Market Growth Graphs)

Current value sales of noodles in stood at slightly over Rs 9 billion, with

pouch

instant noodles accounting for more than 66% of the total value sales.

Growth of Maggi Noodles FY 2005-2006

For the FY 2005-2006, the growth of Maggi noodles was an impressive

15%, with

sales at Rs 6.75 billion and profit at Rs 2 billion.

Maggi –PRODUCT LENGTH

1. Noodles

Maggi 2-Minute Noodle ( Masala ,

Chicken, Curry and Tomato)

Maggi Dal Atta Noodles ( Sambhar taste)

Vegetable Atta Maggi Noodles

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Maggi Rice Noodles (Lemon Masala, Chilly Chow and Shahi Pulao)

Maggi Cuppa mania (Masala yo, Chilli chow yo)

2. Sauces

Teekha masala

Tomoto chatpat

Imli khata mitha

Tomato ketchup

Hot and sweet

Tomato pudina

Ginger, Garlic & Coriander

Maggi Oriental Chilli Garlic

Ginger, Garlic & Coriander

3. Maggi Pichko

4. Soups Healthy

Chef Style

- Cream Mushroom

- Sweet Sour Tomato Noodles

- Tangy Tomato Vegetables

Home Style

- Creamy Chicken

- Mixed Vegetable

- Rich Tomato

Chinese Style

- Chinese Hot Sour Chicken

- Chinese Sweet Corn Chicken

- Chinese Sweet Corn Vegetables

- Chinese Hot & Sour Vegetables

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5. Maggi soup sanjivni

Amla

Badam

Spinach

Dal

Tomato

6. Maggi bhuna masala

Bhuna masala for gravy dishes

Bhuna masala for vegetable dal

7.Maggi magic cubes

Chicken

Vegetarian masala

FOUR P’S OF MARKETING FOR MAGGI

PRICE

Considering the price points in the market for Maggi, it should continue

to position itself in the "snacks" category itself, since few would be

willing to accept it as a meal (Indian Consumption Habits - Noodles still

aren’t taken as proper food item).

Affordable by all income groups.

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PLACE:

• The distribution network is well spread

• Easily available in all kirana stores, retail store etc.

• Market share

PROMOTION:

Changed their advertising campaign- focus on health and nutrition.

Celebrity endorsements. E.g . . . . Javed Jafferi Sales promotion in

schools and offices, as the exercise of brand call.

Market research exercise-regards of taste and health issues. This helped

maggi to think about the customer. Distributed free samples-period of

new launches.

Invited housewives to send new innovative recipes.

Maggi's first product extension was Maggi instant soups launched in

1988. With the launch of Maggi soups, NIL had become a pioneer in the

organized packaged soup market in India...

Taglines like 'Mummy, bhookh lagi hai' (Mom, I'm hungry), 'Bas 2-

Minute,' (Only 2 minutes) and 'Fast to Cook Good to Eat' effectively

communicated the product's benefits to target consumers.

Michael Porter’s Five Forces Model

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New entrants

1. Top Ramen

2. Horliks foodles

3. Sunfeast Pasta

SWOT ANYLYSIS

Strengths

Strong brand recall and the product is almost eponymous to the brand.

Market leader with 79.3% market share in terms of value.

Highest advertising share (72% (TV AdEx 2004-05)).

Emotional relationship with the consumer.

A strong distribution network of the parent company

Weakness

Tagged as a product having no health value.

53 | P a g e

Industrial Rivalry

1. Top Ramen

2. Horliks foodles

3. Chowmeen etc.

Suppliers

1. Distributers

2. Raw material

3. Packaging

Buyers

1. Customer’s mind set

2. Brand Image

Substitutes

1. Fast Food

2. Soups

3. Pasta

It has tried to bring in innovation but has

failed. (Dal Atta Noodles refer survey noodles).

The product features have remained almost constant since inception in

1983 with any trial of innovation misfiring.

Market share has fallen from the 80% in

1998-99 to 79.3% in 2005-06

Opportunities

The instant noodles segment is projected to grow at a tremendous rate

with the market size doubling by 2010.

Increase in the potential consumer base i.e. single working professionals

and student population .

Rapid economic growth and rising disposable incomes make a strong

case for a premium brand like Maggi.

Upward trend of convenience food consumption.

Huge untapped serviceable upward class rural base

Threats

Competition is increasing with established competitors in other segments

are foraying into the noodles segment seeing the capacity of growth.

Top ramen the prime competitor has come up with new exciting instant

noodle

Offerings like cup noodles and mug noodles which threaten to eat into

Maggi’s market share.

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Foreign players like Wai Wai and Rum Pum have forayed into the noodles

market and have made their brand presence in eastern markets while

indigenous

Parle is threatening to offer their distribution network to international

noodle brands wishing to make an entry.

Top Ramen has repositioned itself on a health platform with a new

baseline “Get on Top” fortifying its product with calcium and vitamins.

The product as priced higher than its main rival Top Ramen

Horlicks come up with new Horliks foodles.

Horlicks

Company profile

GlaxoSmithKline Consumer Healthcare Ltd is one of the largest players

in the Health Food Drinks industry in India. The company is an Indian

associate of GlaxoSmithKline plc, UK. The company's principal activities

are to manufacture and distribute a wide range of healthcare foods,

drugs, pharmaceuticals and dairy products. The products include malted

milk food, malted foods, biscuits, energy and protein foods, milk

powders, ghee, milk fluid and milk cream. The company has their

manufacturing facilities located at Nabha in Punjab, Rajahmundry in

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Andhra Pradesh and Sonepat in Haryana. The products of GSK Consumer

are categorized as Nutritional and Over the Counter (OTC) products. The

Nutritional division includes health food drinks like Horlicks, which

includes Junior Horlicks, Mother's Horlicks, Women's Horlicks, Horlicks

Lite, and Horlicks biscuits, Boost, Viva and Maltova. The OTC division

promotes and distributes a number of products in diverse categories,

including prominent brands such as, Crocin, Eno and Iodex.

GlaxoSmithKline Consumer Healthcare Ltd was incorporated in the year

1958 as Hindustan Milkfood Manufacturers Pvt Ltd and was promoted by

Horlicks Ltd. The company became public in the year 1961. In the year

1969, Beecham plc acquired Horlicks Ltd and became the majority

shareholder in Hindustan Milkfood Manufactures Ltd and in the year

1979, Beecham India Pvt Ltd merged with the company. In the year

1991, the name of the company was changed to HMM Ltd. In the year

1989, Beecham plc, UK and SmithKline, USA merged to form SmithKline

Beecham plc. The company became part of SmithKline Beecham and the

name was changed to SmithKline Beecham Brands Ltd. Again, in March

1994, the company name was changed to SmithKline Beecham Consumer

Healthcare Ltd, reasserting their promise of providing healthcare to

consumers. In the financial year 2000, the company acquired two new

brands Viva and Maltova along with their patents and trademarks from

Jagatjit Industries Ltd. The company also tied up the manufacturing

capacity of Jagatjit Industries Ltd for the manufacture of Viva and

Maltova on a long term contract. Glao Wellcom plc and SmithKline

Beecham plc merged and form a global organization GlaxoSmithKline

plc. As the company is an associate company of GlaxoSmithKline plc, the

name of the company was changed from SmithKline Beecham Consumer

Healthcare Ltd to GlaxoSmithKline Consumer Healthcare Ltd with effect

from April 23, 2002. In the year 2002, the company commissioned their

new Spray Drier plant at Sonepat and the commercial production was

started form July 1, 2002. Also, Gussetted Pouch packing operations were

relocated from Nabha factory to a 'State of Art' greenfield facility set up

by a contracted third party at Mangaldoi, Assam. As a result of

56 | P a g e

restructuring process, the company's packing facility at Kolkata was

closed with effect from September 2002. The company is a consignment

sales agent for marketing, selling & distribution of the brand Iodex with

effect form January 1, 2002. In the year 2004, the company has launched

Junior and Mother's Horlicks, Ready-to-Drink Horlicks & Boost and Hot

Vending Machines. In July 2004, they launched Boost Energy Shake, a

new chilled ready-to-drink variant of Boost in Tamil Nadu. Boost Energy

Shake will be available in a 200 ml tetra pack In the year 2005, the

company opened a new secondary manufacturing site (Legacy Foods) at

Baddi in Himachal Pradesh. In February 2005, they launched Horlicks in

a new Toffee flavour. Toffee Horlicks is the sixth flavour in the Horlicks

portfolio. The other flavours are Chocolate, Vanilla, Honey Buzz,

Standard and Elaichi. In the year 2006, the company increased their

installed capacity of Malt Based Foods/Malted Foods and Ghee by 3260

MT and 924 MT respectively. With this expansion the total installed

capacity of Malt Based Foods/Malted Foods and Ghee increased to 94060

MT and 4000 MT respectively. In the year 2007, the company increased

their installed capacity of Malt Based Foods and Milkrose Baby Foods by

340 MT and 760 MT respectively. With this expansion, the total installed

capacity of Malt Based Foods and Milkrose Baby Foods increased to

94400 MT and 2200 MT respectively. In the year 2008, the company

launched Women's Horlicks, which is specially formulated for women.

New Women's Horlicks is scientifically designed with a unique

combination of Hemocaltm nutrients which provides 100% of the daily

requirement of iron, calcium, Vitamins B2, B6, B12 & C for healthy blood

and its normal function. New Women's Horlicks has no added sugar and

is low-fat. It is available in two exciting flavors- Chocolate and Caramel in

a jar with a unique flip top cap. Also, they launched Active Base and

Boost White during the year. In January 2009, the company launched

'Activ Grow', which is a nutritious product launched for infant population.

The product will be sold through prescription only.

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Foodles

GlaxoSmithKline’s (GSK) newest product Foodles has hit the markets

about a month back in the instant noodle category. GSK, which is world’s

fourth largest pharmaceutical, research-based company with a wide

portfolio[1] of pharmaceutical products covering anti-infectives, central

nervous system, respiratory, gastro-intestinal/metabolic, oncology, and

vaccines products and is known in India for its healthcare products and

nutritional drinks, the most popular being Horlicks. The company

generates a good revenue from the nutritional drinks division in India (in

the range of Rs. 1,500 crore[2]) and now wishes to diversify its product

range. But it remains to be seen if it can compete with Nestle’s Maggi,

the most dominant product in the said category with an unbelievable

market share of 91 % in an industry which is worth nearly Rs. 1200 crore

and growing at 20 percent per annum.

Foodles – The Brand

GSK launched Foodles under the name of Horlicks Foodles with two

variants of noodles. - Regular and Multi-grain. It was first launched in

south India which currently is the stronghold of GSK through the

Horlicks brand. It is to go national within a span of 6 months. The

company aims to gain a higher single digit market share within a year or

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two and establish itself as a player in the salty confectionary foods

division.

Foodles- What has been done

The problem with instant noodles has always been the fact that it is not

very healthy. Keeping that in mind, Maggi few years ago came out with

the tag of –“taste bhi , health bhi” which has helped it in maintaining

sales. Foodles has taken this one step ahead and tried to create an USP

out of the health factor associated with noodles. It has made TV

advertisements which highlight the fact that even though it is an instant

noodle, it is healthy and thus should be the consumer’s choice. Foodles

also provides an "Health Maker" sachet which comes along with the

noodles pack which contains the essentials of 5 vitamins[3]. Foodles has

tried to create a product category for itself by differentiating itself from

instant noodles. Also, Foodles is currently trying to appeal to the upper

middle class in the urban areas and placed the product at a premium

price with Its multigrain variant costing Rs 15 for 80 gm compared to

Maggi’s Rs 10 for 80 gm[2]. Also, to use the distribution channel of

Horlicks, initially single packs of Foodles were given for free. So far, the

start of Foodles marketing strategy has been good, but is it enough to

take on the leader of the market of 25 years? The past is not in favour of

Foodles and it has also got to compete with brand like HUL along with

Maggi. Let us examine what more strategies can they can adopt to

appeal to the market.

Interesting Facts:-

Horlicks was first invented to substitute milk as baby food

The brand has been endorsed by Amitabh Bachchan on the radio(1960-70), Moon

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Moon Sen and her daughters Raima and Riya (1980s) and Vishwanathan Anand

In India, over 2 billion cups of Horlicks are drunk every year!

Biggest market is India

6th most trusted brand in India (AC Nelson)

Most trusted health drink brand (Economic Times 04)

More than 50% market share in health drink market.

Evolution

The company believed in Growth through innovation. Previously Horlicks was

imported but as the demands exceeded they set up 2 production units in India to

fulfill the demands of the Indian population. This came as a solution to Indian

market as a health drink.

Then Horlicks entered the biscuit market and later in 1995 they came up with

Junior Horlicks as a baby food supplement. Viva and Maltova were acquired by

the company in 200 and 2001 that increased the product range.

Women‘s Horlicks came into picture initially nursing mothers and then to catering

specific needs of women. Horlicks adopted certain strategies to deal with

competitors and came up with attractive packaging and various flavours.

Horlicks conducted clinical trials and campaigned ―Taller Stronger Sharper‖.

Horlicks segmented the market to increase its market share. It focused on children

to encash their increasing population.

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Then it launched Horlicks Lite which is specially formulated keeping in mind

nutritional needs of adults and also for use by people with diabetes.

Horlicks also entered the instant noodle market with Foodles and Nutribar came as

a energy bar focused on the young generation, these two products were focused as

a healthy solution to the existing fad market (plain maggi and energy bars

Recently Chill Dood is launched in the instant milk shake focused on children.

Horlicks is also involved in several campaigns one being the ASHA project

catering exclusively to the needs to the rural markets.

variant segment communication medium

usededium

Junior Horlicks (1995)

People who are conscious about their kids nutrition and better health. Pre schoolers

ad highlighted-

The key message is need creation for nutrition in preschool children. The handwritten font style created a sense of innocence. A-Z nutrition along with DHA for brain development

61 | P a g e

Horlicks Ninja (1997) Children between 7- 15 years

Organized nationwide events like- Wiz kid & Dream Team. Badlo Apne Bachpan Ka Size-Clinically proven in India that it makes kids Taller, Stronger, Sharper Introduced in chocolate, elaichi & vanilla flavour to attract children

Mother’s Horlicks (1997)

Pregnant women Breast feeding women

Ads promoted :- All round development of the baby. Improvement in the birth weight of the baby. Improvement in the quality and quantity of breast milk during lactation

Horlicks Biscuits (1992) Parents Children

Solid‘ Nourishment containing 100% RDA of calcium. Available in standard & elaichi flavour to highlight ‗great taste‘ & ‗nourishment‘ factor

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Horlicks Nutribar (2009) Children Adults

Multi cereal bar with vital nutrients, fibre and honey. Best suited for your apetite anywhere anytime

Horlicks Foodles (2010) Growing children

Whole wheat and nutrients. Rich in Vitamin A, Vitamin C and calcium. Health maker with power vitamins

MARKET SUMMARY

FOUR P’S OF MARKETING FOR FOODLES

Product:

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Horlicks is a widely regarded and highly respected 130-year-old brand.

GSK has four brands in the health food drinks segment. Apart from

Horlicks, which contributes Rs 600 crores in revenue to the consumer

healthcare division, it has Boost, Maltova and Viva – the last three are

much smaller brands than Horlicks. Faced with stagnating sales in the

health food drinks segment, the company has chalked out an aggressive

brand push strategy and a revamp for its flagship brand, Horlicks. The

relaunch aims to focus on children as Horlicks was previously considered

as a nourishment drink for old people. The company expects Horlicks

contribution to the total turnover to be around Rs 800 crore which

amounts to a major chunk of the company’s turnover. Horlicks is a

nourishing malted food drink which combines the wholesome goodness of

malted barley, wheat and dairy ingredients.  For more nourishment,

Glaxo SmithKline  Consumer Healthcare India Ltd (GSKCH) has

relaunched its flagship brand Horlicks.  To enable consumers choose

different flavours, Horlicks is now available in Regular, Chocolate,

Creamy Vanilla and Honey Buzz varieties in a new package.  Horlicks

drinks provide the following essential nutrients:  Proteins, Carbohydrate,

Fat, Vitamin A, Niacin, Vitamin B1, VitaminB12, Vitamin E, Vitamin B6,

and Iron & Calcium

Price:

HORLICKSFlavors (Rs)Elaichi Chocolate Honey Buzz Vanilla

Weight(gm) Jar Refill Pack Jar Refill Pack Jar Jar200 57 - 57 - - -500 108 103 108 103 108 1081000 199 189 - - - -HORLICKS JUNIORWeight(gm) Jar Refill Pack200 58 -500 114 105

64 | P a g e

Target market:

Earlier Horlicks believed, white drinks are for the entire family in

contrast to the browns, whose prime target audience is children. This is

probably because whites–whose growth rate is faster than the browns–

have the added advantage of being perceived as food which enhances the

healthy image of those who are recovering. But gradually they realized

that they have to focus on one segment of market that is children.

Horlicks is now positioned as a pleasurable nourishment drink aimed at

children between the age group of 8 -14. Nowadays children have

tremendous influence on the things purchased for the family and

therefore we want children to prefer Horlicks as a pleasurable

nourishment drink. While all the action will be in the general Horlicks

segment, the focus of Junior Horlicks (target segment: kids between one

and three) will continue to remain the same.

Promotion:

The company has earmarked around Rs 10 crores for brand promotion

throughout 2003, and 70% of this will be spent in next six months. Sixty-

five per cent of the ad-spend (around Rs 10 crores) will be for the visual

medium and the balance for the print and others. Apart from the high-

decibel media campaign, the company also plans to conduct an inter-

school competition called “Activity 2003” in which around 1.5 million

students are expected to take part. Unlike its other drink (the Rs 170-

crore Boost, promoted by Sachin Tendulkar); the new Horlicks does not

have a brand ambassador. While all the action will be in the general

Horlicks segment, the focus of Junior Horlicks (target segment: kids

between one and three) will continue to remain the same. The brand will

continue to talk to the mother since the purchase decision rests with

her.’

The health drink brand from GSKCH – Horlicks – which has been

traditionally targeted as a ‘great family nourisher,’ has entered into the

highly competitive segment of instant noodles through its newly

65 | P a g e

introduced Horlicks Foodles, aimed to explore the category of salty

snack food market.

Thus, Horlicks kick-off the Foodles offerings in two healthy variants:

Regular and 4 Grain. Both variants come with a trademarked

Healthmaker sachet which has 9 Power Vitamins. Besides, the 4 Grain

variant is made with nutritious grains like Rice, Ragi, Wheat and Corn. As

a sub-variant, each of the two varieties comes in three different flavours

The snack food in Noodles as such has no nutrition value (In fact, it is

often criticized as a junk food) but when it is combined with veggies – it

tastes better (Probably better than the plain maida variant!) and could

also form a healthy snack for kids.

POSITIONING:

It was initially introduced both a substitute & an additive to milk and it

was initially positioned itself as “food for convalescing” & a nutrient

supplement for kids only.

PROMOTION:

Organized nationwide events like- Wiz kid & Dream Team.

Epang Opang Japang .

Say “No” to noodles.

The word noodles replaced with “Foodles”.

CAMPAIGN:

“Badlo Apne Bachpan Ka Size”, takes the thought to the next level by

communicating how Horlicks enables kids to have a bigger, better,

childhood while growing Taller, Stronger, Sharper.

Place:

66 | P a g e

It has a strong marketing network in India comprising over 1800

wholesalers and direct coverage of over 4,00,000 retail outlets.  Horlicks

sales have been strong in the south and eastern markets which

contributes about 46 per cent and 47 per cent of the total sales. Milk-

deficient South and East preferred white liquid powders (Horlicks, Viva,

and Complan) as the drink could be prepared with hot water.

Market Share of the Horliks

Michel Porters model for Horliks foodles

67 | P a g e

68 | P a g e

Industrial Rivalry

1. Maggi

2.Top Ramen

3. Chowmeen etc.

New entrants

1. Top Ramen

2. Sunfeast Pasta

Buyers

1. Customer’s mind set

2. Brand Image

Suppliers

1. Distributers

2. Raw material

3. Packaging

Substitutes

1. Fast Food

2. Soups

3. Pasta

RESEARCH METHODOLOGY

STAGES IN RESEARCH :

69 | P a g e

Problem Defination

To identify the consumer characteristics of the fast food industry.

To understand the influence on purchasing consumers mind set.

To know about customer acceptance of the product.

To see the perception of consumers between any two fast food

region of Vadodara.

To understand why customer buy a particular product.

To help the company to know what consumer want in the product.

To understand Brand Imagery, Brand Quality perceived by

customers, Brand credibility, consideration, superiority and

feelings.

RESEARCH DESIGN:

Research Design:

The research will be carried out in the form of a survey which will be

done in Vadodara. The population has been segmented on the basis of

Age Group

Sample Design:

The target population for our study is households. The sample will be

selected by a simple random sampling method .

Sample Size:

The sampling unit is 150 which are divided as follows:

Number of

respondents

150

Age-group 10 – 45

Survey Locations Pune

Age Group 10 - 25 25 - 35 35 – 45

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Number of Respondents 50 50 50

DATA COLLECTION PLAN

Data Gathering:This study involves data collection (primary research) from different households in four different areas of PUNE

SURVEY RESULTS:

1. Do you consume ready to eat food like noodles and pasta?

Many people eat now days ready to eat food. Here maximum no is 82%.in

this segment working women are there so they preferred ready to eat

food such as noodles, pasta, etc.

2. Which of the following food item would you consume?

71 | P a g e

Yes No0

20

40

60

80

100

120100

45

Chart Title

Maggi Top Ramen foodles pasta0

10

20

30

40

50

60

Chart Title

Most of people eat Maggi such as (55% ) and top ramen. Foodles has gained the market share of Maggi .Better advertisement campaign of foodles has been created awareness of foodles. But still Maggi has more demand than the Foodles.

3. What is the frequency of consumption?

Everday more then a week once amonth No particular pattern0

10

20

30

40

50

60

7062

3327

18

Chart Title

The frequency of Maggi consumption is more than any other products.

Maggi is still market leader in this segment.

4. What is the brand that comes to your mind when we say the word

noodles?

72 | P a g e

Maggi Top Ramen Horliks Foodles

Sunfeast pasta0

10

20

30

40

50

60

70Maggi ; 61

Top Ramen; 33Horliks Foodles

; 26 Sunfeast pasta; 20

Chart Title

Brand Associations:

Sources of Brand equity like brand association of Maggi as a Brand was

found highest with the age group of 10-25 and the product category

associated with it was the noodles category Consumers in the age

segment of 10-25 could easily relate Maggi to noodles.

In the income wise category the brand association was highest with the

income group of 25k-40k were more than 40 respondents associated

Maggi with noodles .The implications from the findings discussed above

seem that Maggi has good brand association in terms of noodles.

Consumers presume Maggi as Noodles and the company’s philosophy of

projecting the brand as noodles brand seem to be viable in this regard.

5. Are you aware of Horlicks foodles ?

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YES NO0

102030405060708090 84

56

Chart Title

There are total number of 84 respondents who said that they are aware

of horlicks but there are only 56 respondents who not aware of the

same..

6. Would you like to try Horlicks Foodles?

Yes No0

10

20

30

40

50

60

70

80

90 83

57

74 | P a g e

As Foodles has Brand name Horlicks has been associated with it so many

people said to try it. Also the impact of advertisement has been created

the curiosity regarding the foodles. So people are ready to try it.

Horliks come with a trademarked Health maker sachet which has 9

Power Vitamins. Besides, the 4 Grain variant is made with nutritious

grains like Rice, Ragi, Wheat and Corn. As a sub-variant, each of the two

varieties comes in three different flavors.

7. How do you aware of Horlicks?

Friends Newspaper Hording T.V ads

Radio Family 0

5

10

15

20

25

30

35

40

45

50

23

31

17

44

12 13

The awareness through advertisement has shown by more than any other

medium of media. Then newspapers have also shown the positive impact

regarding to foodles. It is suggested that foodles has to concentrate on

TV advertisement. Horliks advertisement “SAY No TO NOODLES” which

is gaining popularity and attracting customer also giving an impact on

the minds of customers who are health conscious specially mother who

are very worried about their growing child’s health. Already Horliks has

gained named in the segment of health drink so they are saying that our

noodles are healthy to you and your family through various

advertisements.

8. On a scale of 1 to 5 rate Maggi on the following parameters

75 | P a g e

(1 very good, 2good, 3medium, 4 bad, 5very bad)

Taste

Variety

/Flav

ours

Hygien

e/Purit

y

Health

Packag

ingPric

e

Ingredien

ts

Brand

0

20

40

60

80

100

12098

87 8999

78

5645

86

9. on a scale of 1 to 5 rate Horlicks foodles on the following parameters

(1 very good, 2good, 3medium, 4 bad, 5very bad)

Taste

Variety

/Flav

ours

Hygien

e/Purit

y

Health

Packag

ingPric

e

Ingredien

ts

Brand

0

20

40

60

80

100

120

9887 89

99

78

5645

86

10. According to you which age group prefer Maggi most?

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4– 12 13– 26 27- 40 41– above0

10

20

30

40

50

60

7063

3226

19

11. According to you which age group prefer foodles most?

12 .Which of the following do you think healthier product?

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4– 12 13– 26 27- 40 41– above 0

10

20

30

40

50

60

70

58

41

25

16

. Maggi Horliks Foodles Top Ramen Sunfeast Pasta0

10

20

30

40

50

60

38

51

23

28Series1

13. Which feature out of the following instigates you to buy the product of your choice?

0102030405060

48

3445

14. Do you keep switching on products?

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Yes No0

102030405060708090

100

48

92

15. Demographic Information

Age:

Gender: M-------- F---------

Education: --------------------------

Occupation: ----------------------------

Income: -----------------------------

Children’s: -----------------------------

RECOMMENDATIONS

79 | P a g e

After the conducted study following recommendations could be sited for

Maggi Brand.

To gain maximum leverage in terms of profit the company should pay

emphasis on segments with age groups 25-35 and above .Advertising is

the key to success. Targeting these segments will not only enhance the

company’s profit margins but also it will leverage the brand image of

Maggi.

The company should advertise its products by depicting attributes

related to Health like Nutrition values, % of Vitamins, Proteins etc.This

would help in customers perceiving the product as Healthy

Foray into other food products like chips, chocolates etc under its sole

brand name would not only help in Brand extension but will also enhance

Maggi’s market share.

Conclusion:

The food processing business in India is at a nascent stage. Currently,

only about 10% of the output is processed and consumed in packaged

form thus highlighting huge potential for expansion and growth.

Traditionally, Indians believe in consuming fresh stuff rather than

packaged or frozen, but the trend is changing and the new fast food

generation is slowly changing.

Maggi Today The year 2010 saw India leading in worldwide Maggi sales.

The brand has grown to an estimated value of Rs 160-170 crores and

contributes at least 8–9% to Nestle India’s top line. All the same, some

FMCG analysts feel that the brand has not done much to expand the

noodles category. Even after 25 years of its launch, the size of the instant

noodles market is yet quite small at Rs 300 crores. But yes, the parent

company, Nestle India Limited has certainly encouraged the brand to

enter into other culinary products

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STPD ANALYSIS OF MAGGI BRAND

Segmentation: Market Segmentation divides the heterogeneous market

into homogenous groups of customers who share a similar set of

needs/wants and could be satisfied by specific products. Maggi Brand

have segmented the market on the basis of lifestyle and habits of URBAN

FAMILIES.

Target: Market Targeting refers to evaluating and deciding from

amongst the various alternatives, which segment can be satisfied best by

the company. The Maggi Brand have mainly targeted the Kids, Youth,

Office Goers & Working Woman which falls into the category of

“convenience-savvy time misers” who would like to get something instant

and be over with it quickly.

Positioning: Market Positioning is the act of designing the company’s

offerings and image to occupy a distinctive place in the minds of the

target market. The goal of positioning is to locate the brand in the minds

of consumers to maximise the potential benefit to the firm. Maggi has

positioned itself in the SNACKS category and not in the meal category

since Indians do not consider noodles as a proper food item. Therefore

Maggi have developed its brand image of instant food products with

positioning statements such as “2 minutes noodles” and “Easy to cook,

good to eat”.

Differentiations: Points-of-difference (PODs) are attributes or benefits

consumers strongly associate with a brand, positively evaluate and

believe they could not find to the same extent with a competitive brand.

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The Maggi Brand have also differentiated its brand image from its

competitors in terms of taste, flavours and packaging. Maggi have

launched wide varieties of products in different flavours which can

attract larger set of customers. Maggi products are also available in

different sizes catering to different customer needs.

STPD Analysis of Horliks

Segmentation: Market Segmentation divides the heterogenous market

into homogenous groups of customers who share a similar set of

needs/wants and could be satisfied by specific products. Horlicks have

segmented the market on the basis of lifestyle and habits of URBAN

FAMILIES.

Target: Market Targeting refers to evaluating and deciding from

amongst the various alternatives, which segment can be satisfied best by

the company. The Horlicks Brand have mainly targeted the Kids, Youth,

Office Goers & Working Woman which falls into the category of “Health-

savvy ” who would like to get something instant and be over with it

quickly and it will be healthy.

Positioning: Market Positioning is the act of designing the company’s

offerings and image to occupy a distinctive place in the minds of the

target market. The goal of positioning is to locate the brand in the minds

of consumers to maximise the potential benefit to the firm. Foodles has

positioned itself in the SNACKS category and not in the meal category

since Indians do not consider noodles as a proper food item. Therefore

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Foodles have developed its brand image of instant food products with

positioning statements such as “No to noodles”.

Differentiations: Points-of-difference (PODs) are attributes or benefits

consumers strongly associate with a brand, positively evaluate and

believe they could not find to the same extent with a competitive brand.

The Foodles Brand has also differentiated its brand image from its

competitors in terms of taste, flavours and packaging. Foodles have

launched wide varieties of products in different flavours which can

attract larger set of customers. Foodles products are also available in

different sizes catering to different customer needs.

LIMITATIONS:

The present study is confined to a minimal sample size and may not

reflect the opinion or response of the entire population in general. The

results of our study are entirely confined to the responses of the Pune

consumers and might deviate in terms of actual population as a whole.

Recommendations given after the study are entirely dependent on the

survey and the secondary analysis done in the report.

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Bibliography

Books and Readings

Marketing – Philip Kotlar

Consumer behaviour-Michel R Solomon.

Websites

www.Google.com

www.Yahoo.com

www.gsk-ch.in

www.nestle.in/

http://trak.in/tags/business/2010/08/05/horlick-foodles-maggi-noodles/

en.wikipedia.org/wiki/Maggi

bestadreviews.blogspot.com

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www.consumerpsychologist.com/

Annexure

Questionnaire

1Do you consume ready to eat food like noodles and pasta?

2Which of the following food item would you consume?

3What is the frequency of consumption?

4 What is the brand that comes to your mind when we say the word

noodles?

5 Are you aware of Horliks foodles

6 How do you aware of Horliks?

7 Would you like to try Horliks Foodles?

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8 On a scale of 1 to 5 rate Maggi on the following parameters

(1 very good, 2good, 3medium, 4 bad, 5very bad)

9 on a scale of 1 to 5 rate Horliks foodles on the following parameters

(1 very good, 2good, 3medium, 4 bad, 5very bad)

10 According to you which age group prefer Maggi most?

11. According to you which age group prefer foodles most?

12 .Which of the following do you think healthier product?

13. Which feature out of the following instigates you to buy the product

of your choice?

14. Do you keep switching on products?

15. Demographic Information

Age:

Gender: M-------- F---------

Education: --------------------------

Occupation: ----------------------------

Income: -----------------------------

Children’s: -----------------------------

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