Maggi Brand in India

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  • Topic: Maggi, Instant noodles, Brand
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  • Published : October 23, 2008
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Case Analysis
The Maggi Brand in India
Brand Extension and Repositioning

Background of Maggi:
Nestle India Ltd. (NIL) is the Indian subsidiary of the global FMCG major, Nestle SA. Maggi Brand was introduced to the Indian consumers by NIL with the launch of Maggi 2 Minute Noodles, an instant food product, in 1982. With the launch of Maggi noodles, NIL created an entirely new food category - instant noodles - in the Indian packaged food market. Initially Nestle tried to position the Noodles in the platform of convenience targeting the working women. At that time, Indian consumers were rather conservative in their food habits, preferring to eat traditional Indian dishes rather than canned or packaged food. But it found that the sales are not picking up despite heavy promotion .Research then showed that Kids were the largest consumers of the brand. Realizing this, NIL shifted its focus from working women to children and their mothers and repositioned the brand towards the kids using sales promotions and smart advertising. NIL aggressively promoted Maggi with taglines such as “Mummy Bhook Lagi”, “Bas 2Minute”, “Fast to cook, good to eat” and through several schemes of free samples, gifts on return of empty packs, etc. Later was observed that people of all age group started liking Maggi. Over the years, NIL extended the Maggi brand to a variety of culinary products like soups, sauces and ketchups, and cooking aids among others. In 2005, NIL started offering a range of new 'healthy' products under the Maggi brand, in a bid to attract health-conscious consumers.

Case Synopsis:
This case concentrates on various phases in the product life cycle of Maggi noodles in India. It talks about the various measures and marketing strategies undertaken by Nestle India Ltd. (NIL) to keep the Maggi brand fresh in the minds of Indian consumers and reposition Maggi as a 'health product'. The case also focuses on the various extensions of the Maggi brand and tries to analyze why only the sauces and ketchups category, among all the other product extensions, managed to succeed. This case has also done the competitor analysis which shows the potential threats to Maggi and its extension products from the potential competitors. The case ends with a discussion whether NIL would be successful in sustaining this new image for Maggi in the market.

Issues:
1.What are the strategies undertaken by NIL to create and establish a new product category? 2.What are the problems faced by Maggi in sustaining the image of a popular brand? 3.What are the strategies adopted by NIL in repositioning Maggi noodles among the consumers? 4.What are the strategies adopted by NIL to fight the competition from the competitors? 5.What are the issues involved in the brand extensions?

Analysis:

1.The Brand, its Positioning and Equity
NIL was first company to launch noodles in the Indian market in the early 1980's. Nestle wanted to explore the potential for such an 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 50% market share in this segment which is valued at around 250 crores.

Maggi has faced lot of hurdles in its journey in India. The 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 had a great deal of difficulty in appealing to Indian market. Initially Nestle tried to position the Noodles in the platform of convenience targeting the working women. But it found that the sales are not picking up despite heavy promotion. Research then showed that Kids were the largest consumers of the brand. Realizing this, Nestle repositioned the brand towards the kids using sales promotions and smart advertising. Now Maggi is the number one brand in the noodles.

Maggi was positioned as ‘2-minute noodles’ with a punch line...
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