The Marketing Mix

The following consideration included in our marketing analysis of the Nestle.

Product Place Promotion Price

Product
Product item

Nestle seeks to earn consumers confidence and preference and to follow and anticipate
consumer trends, creating and responding to demand for its products. Therefore Nestle is
driven by an acute sense of performance, adhering to and favoring the rules of free competition
within a clear legal framework. We choose Milo since it is a brilliant example of where as the
superior quality, patented technology and basically selling directly to consumers and this whole
business is growing rapidly. Milo has been in Pakistan since many years.

Product life cycle

There are four stages in PLC. These stages are
Introduction Growth Maturity decline
Milo was launched in Pakistan in late 1980. At that time Milo shows remarkable growth. But
now talking about present status our research about the product and data which we collected
from the organization shows that Milo is at maturity stage.
There is no remarkable growth in the sales of Milo. Now we are working to convert this
maturity stage to growth stage. And we will do this with heavy investment in the field of
promotion. This will defiantly have positive effect on promotion of our product.
Product item depth
Milo is a very well known product and Milo also has variety of product items under the same
brand which is Milo. These are the type of Milo that Nestle have been produce.
1. Nestle Milo Breakfast Cereal:
Boost your fiber intake with one of the MILO Wholegrain cereals and get a head start to the
day. Choose from the original MILO Cereal or MILO Duo Cereal with milky vanilla curls for
added Calcium and Magnesium for strong bones and teeth.

2. Nestle Milo (Ready to Drink):

It contains 200 ml of liquid Milo. Following are the ingredients;
Energy
150 Kcal
Fat
4G
Protein
4.4G
Carbohydrates
24G

This gives you instant energy. In Pakistan Milo is most successful in this shape.
3. Milo Tin:
This product is launched in Pakistan in recent times. It contains 235 ml of liquid Milo. It contains
important minerals and vitamins. This product is imported from Malaysia. Different people
have different likes and dislikes, also the different nations have different tastes. This product
was designed for people of Malaysia according to their taste.
Now we are producing it in Pakistan with a taste according to our people.
4. Sugar Free Milo:
Milo is re-launched with an effort to cater more customers and become a necessary part of
shopping list for every person. Many people these days are suffering from Diabetes. This
product will serve them with the need of Natural energy. Most of the people suffering from
this disease are aged people so zero sugar with full of energy will appeal them to bury Milo.
Product Features:

Right balance in nutrition

Milo provides energy (calories). These calories come from the different

Ingredients of Milo, mainly malt extract, skimmed milk, palm oil and sugar

If consumed moderately, as part of a balanced diet, Milo provides the energy required for an
active lifestyle and will not be fattening.
Milo powder is nutritionally balanced providing the right ratio of protein, carbohydrates and
fats.
The 6 basic classes of nutrients in food are: carbohydrate, fats, protein, vitamins, minerals and
water! A mug of Milo of drink contains these nutrients.
Protein is one of the macronutrients (along with carbohydrate and fats) that is important to
build and repair body tissue. It is essential for healthy growth and development. The protein
needs (per Kg of the body weight) is highest when growth is rapid, such as during infancy,
childhood and adolescence.

This shows that Milo gives us balance nutritions, which keep us healthy and active.

Natural energy:

Carbohydrates supply the main source of energy for the body. Carbohydrates can be in the
form of complex and simple carbohydrate. Simple carbohydrates are sugars that our body can
easily and quickly use for energy. Complex carbohydrates are chains of sugar
units. For example, fiber, starches. Starches are broken down during digestion into
glucose before being absorbed into the body.
So Milo gives us real original and natural energy. Not this type of artificial energy which energy
drinks gives and which is for a small time. Milo is a drink having natural ingredients for natural
energy.

Antigen-E (vitamin and mineral)

Here are two main groups of nutrients: macro-nutrients and micro-nutrients.

Macro-nutrients are those that are needed in large quantities (tens or hundreds of grams)
every day. These are carbohydrates, protein and fats. Micronutrients are those needed in small
quantities (micrograms or milligrams). These are vitamins and minerals.
Vitamins are micronutrients essential to the human body. A deficiency of some vitamins can
lead to diseases or metabolic disorders.

Good for children

Calcium is an important mineral in childhood. Calcium is essential for proper

development of bones and teeth. During infancy, childhood and adolescence period, bone
growth is the greatest. So, it is important to get adequate amount of calcium at these stages of
growth.

Product combination:
Milo is added to hot or cold milk to give it a malted chocolate flavor and extra texture. When
combined with cold milk, it retains the rough texture of its raw state. Milo can be stirred into
steamed milk or hot water to create something similar to hot chocolate or cocoa. Sugar can be
added to the Milo beverage, but many people enjoy it without the addition of sweeteners,
appreciating it for its subtle chocolate flavor.
Another possible use is making a normal cup of cold Milo and microwaving it for approximately
4060 seconds. This gives the Milo drink a biscuit cover on top. Another
popular use is to sprinkle it on ice cream, especially vanilla ice cream. Milo can also be sprinkled
on breakfast cereals. Also very popular is the "Magic Milo" which involves adding Milo to a
small amount of milk with sugar and whipping it to increase the amount of air in the milk,

thereby doubling it in size. Then one adds small amounts of hot water and milk in layers stirring
each new layer vigorously to maintain its lightness. A final layer of whipped cream topped with
extra Milo or chocolate sprinkles. This is more of a
'warm' beverage rather than a 'hot' one and is a more popular version of hot Milo for children.
Product branding
Branding is the collection of attributes that the consumer has come to expect from a product,
which will strongly influence their buying patterns. Branding can be achieved using a company
name - it can be applied generically or, as in the case of Milo, on an individual basis. The brand
name promises the consumer particular benefits, such as quality and value for money, with
these expectations being built up over many years.
A brand name is often considered by a company to be its most important intangible asset. In a
market where repeat purchases are the key to profitability, a brand name becomes paramount
to a product's success.
Milo is known by its name and its color scheme. Every customer is well aware of the product.
People associates Green color with Milo.
The brand is quite strong to differentiate it from others and give value to its customers.

Product Packaging
The packaging materials continue to be the main source of concern, mainly in plastics, but also
to a lesser extent across metals and small packs.
Product packaging will be the same as it is now. The Green color has an association with Milo
recognition. There will be a slight change of images, slogans, etc on the package. The packaging
will include such information and slogans that will create awareness in people about Milo and
will try to change the perception from just flavored Milk to a real source of Natural Energy.

Eco-efficient packaging
Packaging is essential for food safety. It also helps to avoid wastage before and after purchase
by maintaining freshness for the consumer. Nestle strategy is based on optimizing materials,
developing eco-efficient packaging, and providing meaningful information to consumers on
recycling and disposal.
Product Positioning:
Milo is associated with children and Sports. The position from the day first was done through
sports and children. A strong image and position has been achieved in customers minds
so the positioning strategy for re-launching will be the same.

Product Differentiation
Product differentiation is a process in which the company makes its product different from its
competitors and tries to make sure that customers can identify their products easily.
Improve the packaging
Nestle Milo have improve the packaging by replacing the old one with adding the
interesting picture. The new packaging contains more information about Milo and tries to
change the perception about the product. Besides, Milo also has adding more colorful color
beside of their green color which is main color. This improvement can attract children to drink
Milo.

Price
The firm has several options for addressing the price. Domestically Nestls Milo
manufactured finished products to replace imports which will defiantly cut down the cost.
Price strategy:
Price strategy is a basic, long-term pricing framework, which establishes the initial price
for a product and the intended direction for price movements over the product life cycle.
It consists of 3 type of pricing strategy which is Price skimming, Penetration pricing and
Status quo pricing.
We are currently practicing penetration pricing to market Milo which is a way where
Nestle charges a relatively low price for a product (Milo) initially as a way to reach the
mass market.
Penetration pricing is most commonly associated with a marketing objective of
increasing market share or sales volume, rather than to make profit in the short term.
It can result in fast adoption. This can achieve high market penetration rates
quickly. It can create goodwill among the early adopters segment. This can create more
trade through word of mouth. Marketers have 2 choices whether to use profit oriented
profit maximization or satisfactory pricing.
The demand for Milo is fixed and it is gradually increasing at a certain rate. The cost for
producing Milo and the profit earned on each of the products is set. The profit that is to
be earned on Milo products and the market share that company will get is set.
The profit on Milo Ready to Drink is Rs. 5.

Pricing Tactics
Pricing tactics are those techniques which help in attracting customers towards
competitive pricing and towards the product itself.

Quantity discount

Milo is going to have quantity discounts on some certain events and when is required. Most of
these discounts will be for fixed period of times. We are giving 3% discount on every purchase
of a Carton.

Functional discounts

When distribution channel intermediaries, such as wholesaler and retailer, perform a service or
function for the manufacturer, they must be compensated. This compensation, typically a
percentage discount from the base price, is called a functional discount or trade discount.
Functional discounts vary greatly from channel to channel, depending on the tasks performed
by intermediaries.
HKB, Metro and Al-Fatah are primary retailers and whole sellers for Milo so they are granted
with such discounts many times. If any retailer purchases more than 50 cartons per order they
are given 4% discount and any whole seller sells more than 100 cartons per order they are given
6% discount.

Seasonal discount

Seasonal discount is a price reduction for buying merchandise out of the season. It shifts the
storage function to the purchaser. Seasonal discounts also enable manufacturers to maintain a
steady production schedule year-around.
Milo Ready to Drink has a life of 3 Months. If any buyer (retailer, whole seller) buys that product
which is in its last month a seasonal discount will be given depending upon the purchase
amount.

Placement
There are two types of distribution (direct, indirect). We are using indirect distribution as well
as direct distribution. In direct distribution we are directly giving our product to whole sellers
and retailers and in indirect distribution we are giving our products to distributors who
distribute it further.
Potpourri also keeps Milo at their spot. In whole sale Metro Cash n Carry is our whole seller.
Nestle is also distributing Milo at different bakeries e.g. Good Luck, Shezan, etc.
Channel structure
We are using both retailer and whole seller channels.

Intensity of Distribution:

How vigorously you distribute your product is the intensity of distribution. We had three
choices;
Intensive distribution (to distribute every where) Selective distribution (limited number of sales
outlets) Exclusive distribution (one outlet per area)
In this re-launching we have adopted Intensive distribution. We are distributing Milo at
big stores and bakeries and also giving it to our distributors.

Promotion
The main function of Nestle Milo promotional strategy is to convince target customers that
their goods and services offered provide a differential advantage over the competition.
Milo is convincing their customer that children will be more energetic, sports man will be more
powerful, and students will be more active if they consume Milo. They also effectively
communicate this differential advantage through advertising featuring
Pakistans top national cricket players like Shoaib akhter. Afiridi and Umer akmal.
Advertising

Television

Milo is heavily advertising on T.V. channels. According to the research mostly people prefer to
watch Music and Movies channels. Our main advertising channels will be MTV, Star Movies,
cartoon network, GEO and ARY. Many other channels will be captured later.

Outdoor media

Milo sponsors almost all type of sport event and Nestle also collaborate with Ministry of Sports
and Youth in order to organize national and international sport event. They normally open a
booth in every event they sponsored and giving out free Milo drinks. It is really effective since it
can instill relationship between product and consumers.
We are targeting Cricket and Football first and then Hockey and other sports.

Internet
Nestle have their own website which is www.nestle.com more than 100 countries are
registered under this website. Nestle also have their own website for each product that they
sell (e.g. www.milo.com.my) which is estimated around 30,000 products worldwide. It
is established so that consumer can easily find information about their particular product and
also as a medium for consumer to leave their suggestion in order for Milo to improve their
product.

Printed Media
Printed media includes newspapers, magazines as well as posters. We are promoting Milo in
childrens magazine since they are the main target market for the product. The advertising
should support public figures such as Umer Akmal in order to attract sportsmen and children
who involves in sports. Posters are usually distributed to all wholesaler and retailers who are

selling Milo which can help people to recognize the places that do sell Milo. We are using
different cartoon characters to attract the childrens.

Promotional Activities:
We are also giving miscellaneous item such as a unique mug with Milos logo, a key chain, a
school bag complete with the stationary for children. The pictures below show some example
on how Milo is promoting their products to the customer.

Free 200ml Milo on purchase of 6 cans:

If the customer buys 6 cans of Milo, they will get 1 free small pack of Milo and this promotion
valid for some period.

Buy 1kg Milo and get a free cup:

This is the second activity of Milo to promote their product. If the customers buy 1 KG pack of
Milo, they will get 1 Milo Cup. This kind of promotion will attract all the kids and even the adult
to buy it.
FREE 1 MILO sporty tumbler on: purchase of MILO 1kg pack.
This promotion will attract sporty person to buy it. This is because the tumbler is easy to carry
everywhere and it is very fit to sporty person that have to move a lot.