1. INTRODUCTION TO FMCG INDUSTRYFMCG industry,alternatively called as CPG (Consumer packaged goods) industry primarilydealswith theproduction, distributionand marketingofconsumer packaged goods. The ast!oving Consumer Goods (!CG) are those consumables which are normally consumed by theconsumersat aregularinterval. "omeoftheprimeactivitiesof!CGindustryareselling,marketing, financing, purchasing, etc.Theindustryalsoengagedinoperations, supplychain,production and general management.The ast !oving Consumer Goods (!CG) industry in #ndia is one of the largest sectors in thecountryandover theyearshasbeengrowingat averysteadypace. Thesector consistsofconsumer non$durable products which broadly consists, personal care, household care and food% beverages. The #ndian !CG industry is largely classified as organi&ed and unorgani&ed. Thissector is also buoyed by intense competition. 'esides competition, this industry is also markedby a robust distribution network coupled with increasing influ( of !)Cs across the entire valuechain. This sector continues to remain highly fragmented.Industry ClassificationThe !CG industry is volume driven and is characteri&ed by low margins. The products arebrandedandbackedbymarketing, heavyadvertising, slickpackagingandstrongdistributionnetworks. The !CGsegment canbe classifiedunder the premiumsegment andpopularsegment. The premium segment caters mostly to the higher*upper middle class which is not asprice sensitive apart from being brand conscious. The price sensitive popular or mass segmentconsists of consumers belonging mainly to the semi$urban or rural areas who are not particularlybrand conscious. Products sold in the popular segment have considerably lower prices than theirpremium counterparts.Th facts a!out th FMCG Industry!CG, otherwise known as CPG, is one of the biggest industries in the world and there are a lotof facts that stand the !CG industry apart as a career choice+FMCG co"#anis ar !hind th !i$$st !rands in th %orld. !CG is all about names, the products which everyone recogni&es from trips to the supermarketor from ads on television. The brands that make up this sector are the high profile ones, the oneseverybody knows and loves. Think Coca$Cola, ,ettol and ,ove. This is an industry that puts youin living rooms, kitchens and bathrooms across the globe.Th FMCG industry chan$s fast and is constantly &ol&in$. #t-s fair to say there is never a dull moment in !CG. rom the pace at which goods leave theshelves to the rate of product innovation and career progression, things move .uickly. /nd itdoesn-t end there. The brands themselves are changing 0ust as .uickly. 123 of brands on the top422 list twenty years ago have already been replaced by new names today.FMCG fir"s thri& on "#loy and custo"r rtntion. 5mployee investment is a big part of the ethos of the !CG world. Perhaps it-s because weunderstandthe importance of loyalty. Customer loyaltycanmake or breaka brand. TakeTwinning6s, for e(ample 7 a century after they entered the top 422 brand list, they are still thereandgoingstrong. "oit makessensefor!CGcompaniestoencouragetheloyaltyoftheiremployees too.FMCG co"#anis can !at th rcssion. This isanindustrythat hasproveditself veryresilient torecession7withthema0orityofcompaniesinthesector weatheringthefinancial storminawaythat veryfewothershavemanaged. 8hy9 8ell, consumers will always needtobuytheproducts createdby!CGcompanies. They may not buy big items like refrigerators or cars in a recession, but floors stillneed to be cleaned, clothes need to be laundered and aches and pains still need to be soothed.Th FMCG industry thin's !i$$r ( and !ttr. This is an industry that offers things on a whole new scale. 8here else could you find yourselfhandling :4;2 million accounts9 8orking in !CG gives you the chance to be a part of someglobal successstoriesandinfluencethewayconsumersshopforproducts. !CGfirmsarealways thinking of the ne(t great discovery or innovation 7 always developing and ever$changingto meet consumer-s needs.FMCG has a history of dli&rin$ %hat consu"rs %ant. "ome !CG companies-roots are over two centuries old 7 driving the industry to a value of:;ere it re.uires thehigh cash re.uirement to come into the stars areas. Thus we can take the product is !/GG# ,al/tta )oodles.C*S+ CO,S4Cash cows are with the strong market position and low growth rate. "uch markets are usually ina position to make their product favourite with the low price in the market. >ere the e(ample is!/GG# !asala lavours which is very popular in today6s market.DOGS4>ere the marketing position and market growth rate both are very low and it is not profitable forthe company. Thus company must have to stop the production of the products coming under thisarea.2ortr8s Fi& ForcsThe Porter-s ive orces tool is a simple but powerful tool for understanding where power lies ina business situation. This is useful, because it helps you understand both the strength of yourcurrent competitive position, and the strength of a position you are considering moving into.2OT-NTI*5 N-, -NTR*NTS INTO T+- INST*NT NOOD5-SM*R7-T IN INDI*.#nitially, !aggi noodles with its Btwo minute formulaD dominated the #ndian noodles market.Keport published by The 5conomic Times on A2th august, C242 shows that !aggi is losing itsmarket share because of entryof newer entrants like Gla(o"mithQline-s (G"Q) >orlicksoodles,>industanJnilever-s (>JN) Qnorr "oupynoodles, 'ig'a&aar-s TastyTreat, TopKamen and several other smaller players, according to data by market research firm )ielsen. EtherslikeCapital oods- Ching-s"ecret andCGoods-s8ai$8ai, "pencer6ssmartchoice noodles, /ditya 'irla Ketail-s easters are notching up share. >JN and G"Q have positioned their product as Ohealthy snacking6.oodles comes with the punch line of B)oodles without the O)o6+ /vailable only in themulti$grain and wheat variant, the product is being promoted as having higher nutritionalvalue compared to other popular brands. The main uni.ue selling proposition (J"P) ofoodles is the vitamin$packed health$maker sachet that comes with the pack. The data shows that !aggi-s share of instant noodles, on an all$#ndia basis, across urbanmarkets, has slipped consistently between ,ecember -2? to Guly -42. 8hile !aggi instantnoodles had a ?2.ealth bhiD1. 'ring different types of variety with different flavour !aggi C minutes noodleRs lavour Chicken ,Megetable,Pi&&aCurry, Cheese Tomato masala ,etc ;.They target Qids, office goers,youths, working women H. They began to make a brand image using high promotion eavy promotions to dealers and consumers Prices and profits fall #n C22A>industan Never Ntd was all set to take on )estle-s bestselling !aggi C$minutenoodles bylaunchinganewcategoryof li.uidsnacks under its foodbrand, Qnorr/nnapurna. The new product, called Qnorr /nnapurna "oupy "na(, was priced aggressively at Ks ;and had four variants+ two chicken options and two vegetarian. Nike !aggi, "oupy "na( will be an in$between$meals snack and will be targeted at allage groups, particularly office$goers.Dclin Sta$ If no #roduct inno&ation !rou$ht5ventually, the market for a product will start to shrink, and this is what6s known as the declinestage. This shrinkage could be due to the market becoming saturated (i.e. all the customers whowill buy the product have already purchased it), or because the consumers are switching to adifferent type of product. Nong$run drop in sales. Narge inventories of unsold items.Brand Value chain analysis- Nestle Maggi Marketing Program Investment: a. Product: )estle !aggi has made significant investment in product. #t has came up withseveral product linelikeCminutenoodles, pasta, Qetchups, soups etc, indifferent flavors,different packaging like value saver packs, sachet etc. !aggi )oodles is the lagship product of)estle !aggi. b. Communications:)estle!aggi mainlycommunicateits products %benefits viaadvertising primarily TM advertising. /nd have also launched several marketing campaigns fromtime to time like B"hare your e(perienceD Campaign, BGuess the tasteD campaign etc. /nd alsopromotional campaigns in schools, colleges % offices, free sample distribution, gift on return ofempty pack etc c. Trade: /vailable at ma0or retail outlets, provision stores. d. Ethers+ #nvites housewives tosend innovative recipes made from !aggi, organi&ed contests % industry visits for students andseveral other interactive activities.Multilier ! Program"uality:)estle !aggi marketing programs are high on clarity, relevance,distinctiveness and consistency part. /ll the marketing programof nestle !aggi wereunderstandable. !aggi was launched in #ndia with tagline Bast to cook, Good to eat BC !inutenoodles. Nater focus was shifted to health and nutrition factor. They launched BTaste bhi healthbhiD campaign which is synonymous for !aggi. Gingle of !aggi is .uite catchy and still familiarin respective target audience. The ads featuring Gaved and Panka0 kapoor were also popular./llthese programs were well integrated and consistent with its core BGood food good lifeD.Customer Mindset:'rand /wareness+ 'rand recall for !aggi is high, still !aggi is instant recalled in its flagshipproduct category$ Cmin noodles. b. Brand #ssociations: "trong$ Tasty % >ealthy, Mariety, 5(perience, Convenient. c. Brand#ttitudes:Positive%favorableattitude, as !aggi has always provided%maintained its products6 .uality. d. Brand #ttachment: !aggi still have its loyal customer base, it6s been long !aggi isone of the ma0or players in #ndian market (since 4?@A). "till consumers adhere to !aggi. e. Brand #ctivity:#t is high for !aggi as many consumers still use !aggi products.D /survey carried out by the )ational Council of /pplied 5conomic Kesearch named !aggi thecountry-s most valued !CG brand.D (#t is clear from the fact that in C22; !aggi had A.< billionmarket share from 4.< billion in C22A.)Multilier-Marketlace Conditions:a. Cometitive$ueriority:!aincompetitors of !aggi are $ >ein&"auces andQetchup, Qnorr "oups, Qissan"auces andQetchup, TopKamen, "unfeast Pasta, Lippeenoodles, >orlicksoodles, Qnorr"oupynoodles, 'ig'a&aar-sTastyTreat andseveral othersmaller players. (/s per data by market research firm )ielsen)b. Channels%otherintermediarysuort:There seems tobesufficientchannel % other intermediaries support as !aggi products are available in several retail outletswith sufficient shelf space % at provision stores as well. c. Customer $i&e % Pro'le: Children, "tudents, 8orking people, Parents.Market Per(ormance:a. Market $hare:!aggi is the leading player with @H.;3 market share in Guly-42 on anall$#ndia basis, as per )ielson report ("ource+ 5conomic Times) b. Price Premium: /s varieties of products are available and number of competitors alsoincreasing, thus no premium charged.c. Price )lasticity:There has been elastic response to increase in price. /s varieties ofproducts are available and switching cost is low, thus competitive pricing being followed so far. d. )*ansion $uccess: !aggi has e(panded via introducing innovative product variants,new product linesP these are accepted by the consumers in market. #t has been a success overall.Multilier- Investor $entiment:a. +ro,th Potential: Growth prospects are there, though competition has increased andmarket share declined from ?23 to @H.;3 still !aggi is one of the most valued !CG brandand has high potential to grow further. /s per )ielsen report C242$ )estle has the potential toe(pand the Ks 4,A22$crore instant noodles category 7 which itself is growing at a rapid 4;3annually. b. -isk Pro'le: /s now days consumers are becoming more health conscious and varioushealth oriented products are being introduced, thus health could be a risk factor even though!aggi is in health % nutrition segment also. /nd also competition is increasing. !aggi-s share ofinstant noodles has declined consistently from ,ecember -2? to Guly -42. !aggi had a share of?23in,ecember, C22?, whichdeclinedto@H.;3inGuly,C242. ("ource+ 5conomictimes,)ielson report) c. Brand Contribution:It is highly important as !aggi is the flagship brand of )estlesince C224.2roduct D&lo#"nt 2rocss Ida Gathrin$ /ll the #deas will be Gathered Ida Scrnin$ #deas will be filtered Conc#t D&lo#"nt 2rocss/ccording to the concept product will be developed Sa"#l 2ac's Keleasesample product Fd )ac'Takes the feed back from the Customer Furthr I"#ro&"nt #t changes the product as per customer re.uirement BA!D "IEAC"# $% !EST&ENeed .amily :The need family of )estle is B>ealthD Good ood Good life.Product .amily: The product family of )estle is >ealth Care.Product line: Milk roduct- )5"TNU !#NQ!/#, Creations )5"TNU aV milk )5"TNU !#NQ!/#, )5"TNU "lim !ilkCo/ee- )5"C/U CN/""#C )5"C/U !y irst Cup )5"C/U C/PPJCC#)E )5"C/U "J)K#"5 Premium )5"C/U "J)K#"5Product Class or Product Category:)estle Put all the Product in one class which related to each other under one Product Category.Preared 0ishes !/GG# C$!#)JT5 )oodles !/GG# ,umdaar )oodles !/GG# 'huna !asala !/GG# CJPP/ !/)#/ !/GG# >ealthy "oups !/GG# !/G#C Cubes !/GG# !asala$ae$!agic !/GG# )oodlet& !/GG# "auces !/GG# Pichkoo !/GG# Megetable /tta )oodles !/GG# Megetable !ultigrain& )oodles !/GG# #mli Pichkoo "auceProduct Tyes: )estle has different Product types in Chocolate. )5"TNU ,/KQ C>ECEN/T5 )5"TNU ,/KQ C>ECEN/T5 ,ry ruits )5"TNU udges )5"TNU "5N5CT#E)" ine Chocolates )5"TNU "5N5CT#E)" Panned ,ry ruits )5"TNU Q#TQ/T )5"TNU '/K$E)5 )5"TNU !J)C> )5"TNU !J)C> PEP C>EC )5"TNU !ilk Chocolate )5"TNU !#NQL'/K )5"TNU !#NQL'/K C>EE )5"TNU !#NQL'/K Crispy 8aferItem : )estle has ; variant of coffee and available in 1 si&e. "o the )estle has ;W1XC2items in Coffee."olistic Mar'etingThe all encompassing promoting idea is focused around the advancement and outline of the advertising program, techni.ues and e(ercises that perceives the e(pansiveness and between conditions. #t endeavors to create and keep up different points of view on the organi&ation6s business e(ercises. B5verything matters,D is the motto. This boils down to the fact that one must take into consideration every e(ternal factor which affects or is affected by the business.Internal marketing- #t is important to establish secure and informative internal communication for the benefit of both employers and employees.Integrated marketing-The integrationof product, place and promotion of the marketing plan to touch all aspects of marketing.The product offering has to be communicated to the customer using appropriate promotional methods and it has to be made easily available too. )estle !aggi is available across all ma0or departmental stores in Tier one cities and is promoted as a healthy diet$free )oddles for health conscious audience.-elationshi marketing- This is possibly the most important element of holistic marketing. #t is important to maintain cordial and mutually beneficial relations with the suppliers, distributors and of course customers to ensure long term effective partnership.)estle has maintain a good relationship with all its vendors for the success of the product !aggi.$ocially resonsible marketing- / firm needs to fulfill its responsibilitiestowards the society. Enly having a profit making approach with no consideration for the environment will result in bad word of mouth, loss of reputation, loss of customers in to future, imposing penalties and loss of license to continue the business.)estle has played a vital role in by making socially responsible marketing.(m)rella BrandingJmbrella brands are brand names that are utili&ed by a range of different but related products."ometimes referred to as family branding./numbrellabrandingstrategy, isa marketing practicethat involvesmarketingmanyrelatedproducts under a single brand name.8hen a group of products are given the same brand name#t becomes a case of family brand*umbrella brand. / company may resort to different branding approaches for different product lines.Jmbrella branding involves creating huge brand e&uity for a single brand. Jmbrellabrandingis alsoknownas familybranding. #t is verycommontofindumbrellabranding in !CG products. )asic ida of u"!rlla !randin$5nhance marketability of product. The concept conveyed to consumers is $ any product that carries the brand name is producedusing the same high standards of .uality.Jmbrella 'randing only works when the company has a line of very similar products.The master brand has to be acknowledged on products because it commands trust, respect %loyaltyM*GGI12-minute Noodles3 cover o( 4MB-)55# B-#N0IN+ )estle !/GG# #ndia-s most successful dairy product company follows umbrellabranding. Compared the umbrella brand and individual brands to an #ndian family. !/GG#createdits brand e.uity by the help of J'. 8here in umbrella brands $ like the #ndian family, the father is the head, looking over thechildren. 8hen they grow up and become independent, they hold the umbrella for the family. #ndividual brands on the other hand are like a western family, who grow up fast and leavethe father behind. !/GG#6s advertising and marketing spend has never e(ceeded 43 of its revenues. ,espite a limited budget, !/GG# C$minute )oodles campaignYhave always managedto evoke a larger$than$life brand feel. Customer knows )5"TN5as a .ualityprovider sotheybelieves all products of)5"TN5 as a .uality product. #t is easy for )5"TN5 now to launch new products as customer got idea about companyand its products. 8hen people see a common identity they will want to try other variants of same identitybecause of the umbrella brand.Brand Identity'rand identity and packaging are intrinsically linked, but even iconic designs sometimes needupdating to match the needs of the market. PC# talks to Philippe Koulet, head of packaging for)estle, about his approach to maintaining brand identity.#t is in making an impact on consumers in a split second from a crowded shelf that successfulpackaging stands out in the ast !oving Consumer Goods (!CG) market. 8ith more productsvyingfor attentioninacompetitivemarket, maintainingastronglinkbetweenbrandandpackaging is important to secure market share, but at the same time companies must constantlyupdate their packaging in line with consumer trends, regulatory compliance issues and evolvingtechnology.Getting this balance right is crucial for firms in many markets, not least the food and beveragesector.-or )estlT, packaging has a key role to play in brand recognition,- says Philippe Koulet, >ead ofPackagingfor )estlT. -Packagingis thefirst contact consumers havewithour brands. Gustremember that igh Court lifts the ban. The company has initiated several steps on how to reposition !aggi noodles in a =rightful= way in the domestic market, 'usiness "tandard reported.Toward achieving this, the company has rolled out an internal survey to get =inputs= from its employees.=8e are determined to resolve the !aggi noodles issue in the best possible way. 8e will return !aggi to its rightful position as -the most trusted food brand in #ndia-. Lou have a role to play, too. 8e know many of you will have suggestions or comments as to how this can be achieved,= )estle #ndia-s !anaging ,irector 5tienne 'enet said in a recent e$mail to the company-s employees.The company has launched a separate web page for this and has partnered with surveymonkey, an online survey company, to elicit suggestions from employees on rebuilding the !aggi brand.>owever, the company restricted outsiders from viewing this survey.The intention is to bring out ideas to deal with the crisis over its flagship brand and also chalk out a plan for the future, said a source.The relaunch of !aggi noodles is likely to involve a revamp of product packaging by )estle #ndia, as the company tries to =mark a complete break from the past.=The company is likely to focus more on the labelling issue, in order to make sure that it doesn-t violate the food safety standards.=Nabels such as -)o added !"G- could be removed from the new packs,= said a source./ )estle #ndia spokesperson said that the company would look at all the options available to relaunch !aggi.='ut no concrete plan can be drawn on the matter before complete clarity on the issue,= the spokesperson said.2RODUCT 2ORT FO5IO OF T+- )R*ND4 9M*GGI:The product mi( of !aggi is divided into various categories defined below. Thecompany has launched various products under each category as mentioned below.Noodls !aggi C$!inute )oodle ( !asala , Chicken, Curry and Tomato) !aggi ,al /tta )oodles ( "ambhar taste) Megetable /tta !aggi )oodles !aggi Kice )oodles (Nemon !asala, Chilly Chow and "hahi Pulao) !aggi Cuppa mania (!asala yo, Chilli chow yo).Saucs Teekha masala Tomoto chatpat #mli khata mitha Tomato ketchup >ot and sweet Tomato pudina Ginger, Garlic % Coriander !aggi Eriental Chilli Garlic Ginger, Garlic % Coriander.Ma$$i 2ich'o Tomato ,imliSou#s +althy Chf Styl $ Cream !ushroom $ "weet "our Tomato )oodles $ Tangy Tomato Megetables +o" Styl $ Creamy Chicken $ !i(ed Megetable $ Kich Tomato Chins Styl $ Chinese >ot "our Chicken $ Chinese "weet Corn Chicken $ Chinese "weet CornMegetables $ Chinese >ot % "our Megetables.Ma$$i Sou# San;i&ni /mla 'adam "pinach ,al TomatoMa$$i )huna Masala'huna masala for gravy dishes 'huna masala for Megetable ,alMa$$i Ma$ic Cu!s Chicken Megetarian masalaMa$$i 2asta4 $ 8hite, Ked*NSOFF2*NSION GRID/nsoff !atri( represents the different options open to a marketing manager when consideringnew opportunities for sales growth.)*istingroductsNe, roducts)*istingMarketsNe, MarketsM*R7-T 2-N-TR*TIONThis is the ob0ective of higher market share in e(isting markets.#n C242 !aggi announced a reduction in prices from Ks.42 to Ks.; in #ndia in order to encouragepurchases. M#-6)TP)N)T-#TI7N84grade e*istingvariants o( M#++I9P-704CT 0)V)57PM)NT8Introduce ne, variantso( M#++I9M#-6)T0)V)57PM)NT8.indingne,markets(or e*isting variantso( M#++I9

0IV)-$I.IC#TI7N85aunch totally ne, variants o( M#++I in totally ne, markets9M*R7-T D-3-5O2M-NTThis is the strategy of selling an e(isting product to new markets.This could involve selling toan overseas market, or a new market segment.)estle !aggi are making hand held games consoles (e.g. ,") appeal to the adult*Children byintroducing games such as 'rain Train.2RODUCT D-3-5O2M-NTNeast risky of all four strategiesThis involves taking an e(isting product and developing it in e(isting markets.!aggi has introduce different variant of products in the last five years in the !CG market.DI3-RSIFIC*TIONThis is the process of selling different, unrelated goods or services in unrelated marketsThis is the most risky of all four strategiesrom !aggi )oddles to Qetchups,!asala soups etc.CONC5USION!aggi though has been able to differentiate itself from other )oodles, !aggi'eing taken as generic to )oodles is hampering other e(tended product category. Competitorshave high grounds to capture the market differentiating then from being !aggi. #t makes otherspossible product category vulnerable if lunched under !aggi. "o to avoid proliferation of brandand introduce new products to capture opportunities in other snacks and ready to eat productcategory )#N has to introduce new branding strategy. 'y doing so, )#N could avoid the drawbacks associated with the !aggi brand. #t could position new brand in competition with othercompetitor6s brand where there is no fit of product with the !aggi brand.