Maggi

The Product Life

Cycle

Introduction of Maggi 2-minutes

Nestle wanted to explore
Noodles
the potential for such an
Its a Brand of instant Noodle

made by Nestle India Ltd.

It was found by the Maggi
family in Switzerland in the
19th century.
Nestle launched Maggi for
the first time in India in the
year 1982.
The Brand is popular in:

Australia
India
Malaysia
New Zealand
Singapore

Instant food among the

Indian market.

It took several years and

lot of money for Nestle to

establish its Noodles brand
in India.

Now it enjoys around 90%

market share in this

segment.

Over the years Maggi has

launched several products

under its Brand Name.

ISSUES
Different phases product life cycle of maggi
Why atta noodle was a failure?
Strategies taken to establish new product
category
What measures NIL should take to sustain
the image of a popular brand image.
Stage at which maggi is in the product life
cycle.

PRODUCT LIFE CYCLE

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

GRAPHICAL REPRESENTATION OF A
TYPICAL LIFE CYCLE

Dollars

Introductory
Growth
Stage
Stage

Maturity Decline
Stage Stage
Product
Category
Sales
Product
Category
Profits

Time

Introductory Stage

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

STPD Analysis
Segmentation

Targeting

Positioning

Differentiation

Age

Kids

Fast to cook
good to eat

Taste

Eating Habits

Youth

2-minute
noodles

Flavours

Lifestyle of
urban
families

Office goers

Taste bhi
health bhi

Packaging

Working
Women
Health
conscious
people

Market Penetration Strategies

Promotional campaigns in
school.
Advertising strategies: focusing on kids.
New product innovation
according to the need of
consumers:
Veg. Atta
Noodles.
Dal Atta Noodles.
Cuppa Mania.
Availability in different
packages:
50 gms.
100 gms.

Growth Stage

Increasing rate of sales

Offered
Offered in
in more
more
Entrance of competitors
sizes,
sizes,
Initial healthy profits
flavors,
options
flavors,
options
Promotion emphasizes brand ads
Prices normally fall
Development costs are recovered
10 yrs back it enjoyed around 50% market share in this segment which
was valued at around 250 crores.
During the 1990s, the sales of Maggi noodles declined, due to growing
popularity of Top Ramen , another instant noodles product.
In order to improve sales , NIL changed the formulation of Maggi
noodles in 1997.
However, this proved to be a mistake, as consumers did not like the
taste of the new noodles.
In March 1999, NIL reintroduced the old formulation of the noodles,
after which the sales revived. Over the years, NIL also introduced
several other products like soups and cooking aids under the Maggi
brand.

Maturity Stage
Declining sales growth
Saturated markets
Extending product line
Many
consumer
Many
consumer
Stylistic product changes
products
products are
are in
in
Heavy promotions to dealers and consumers
Maturity
Maturity Stage
Stage
Prices and profits fall
In 2003 Hindustan Lever Ltd was all set to take on Nestle's
bestselling Maggi 2-minute noodles by launching a new category
of liquid snacks under its food brand, Knorr Annapurna.
The new product, called Knorr Annapurna Soupy Snax, was priced
aggressively at Rs 5 and had four variants: two chicken options
and two vegetarian.
Like Maggi, Soupy Snax will be an in-between-meals snack and
will be targeted at all age groups, particularly office-goers.

STPD Analysis
Segmentation to
Differentiation:
Classic Noodles
5 10 yrs.
Veg. Atta Noodles
Health Conscious.
Rice Mania
Teenage
Cuppa Mania
Office goers,

Decline Stage If no product

innovation brought

Long-run drop in sales

Large inventories of
unsold items
Elimination of all nonessential
marketing expenses

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

Extending the PLC

Change product

Change product use

Change product image

Change product positioning

CATEGORIES OF NEW
PRODUCT/REVISING THE PRODUCT
New-To-The-World
New-To-The-World

Six
Six
Categories
Categories
of
of
New
New
Products
Products

New
New Product
Product Lines
Lines
Product
Product Line
Line
Additions
Additions
Improvements/Revisi
Improvements/Revisi
ons
ons
Repositioned
Repositioned
Products
Products
Lower-Priced
Lower-Priced
Products
Products

Analysis(why Atta Noodles

Failed?)

In 2005 Nestl India

launched MAGGI
Vegetable Atta Noodles.

Based on consumer
needs and evolving
trends for more whole
grain based products.

Extensive Research
and Development
expertise to develop
Maggi Vegetable Atta
Noodles.

Maggi Vegetable Atta

Noodles will provide the
dietary fibre of whole

The health angle

Comparing the prices

FAILURE CAUSES
1. Indian psycheThe basic problem the brand faced
is the Indian Psyche. Indian Palate is
not too adventurous in terms of
trying new tastes. So a new product
with a new taste that too from a
different culture will have difficulty in
appealing to Indian market.

2. PriceThe price of atta noodle was little more than

maggi 2 minutes noodle
3. False claimsIn October 2008, Nestle mistakenly aired an
advert that noodle "help to build strong
muscles and bone". The
British Advertising Standards Authority said
that it was a false claim.
4. Not purely vegetarianMaggi Noodles also contains the additives
E150d and E627.E627 is partly prepared from
fish,and is thus not suitable for vegetarians.
E150d is sometimes made from genetically
modified maize

5. Lack of essential
nutrientsThe new maggi atta
noodles as can be seen
from the fig. lacked
essential vitamins A,
C,also the fat content was
more then carbohydrates
6. Targeted health conscious
peoplebut atta
noodle didnt appealed
thembecause of other
Substitute supplements in
the market

Suggestive Promotional
Strategies
1. They should conduct test marketing before
launching new product.
2. Focus on creating distinctive image, based on
twin benefits of INSTANT and HEALTHY.
3. Conduct promotional campaigns at schools in
small towns with population more than
10,000.
4. Strengthen the distribution channel of the
rural areas within 100 KM of all the metros.
5. Launch new advertisement campaign (T.V.,
Radio and print media commercials) with the

Current Scenario of Maggi

Leading Brand in India as
well as World.
Current Sales: Approx.
90000 boxes
Rs. 4,79,49,000 in
Mumbai
10,00,000 boxes
55 cr. in India
Reasonable competitive
pricing.
Creative interaction blogs
for customers:
www.maggi-club.in
Focus mainly on Health
Benefits.

Thank you