1.0 EXECUTIVE SUMMARY
“Milo”, a brand of chocolate/malt powder beverage of Nestle, which is once known in the past as number one brand in customers’ mind in Thailand. But nowadays Milo is not that well perceived as before but another leader, Ovaltine, had triumph the position and become market leader in the segment. With the nature of Nestlé that utilize generic marketing strategy such as cost leadership in business, the company is currently struggling hard time finding the competitive advantage for Milo, when it comes to face to face with its main rival, Ovaltine. The main objective of this marketing plan is to provide useful of marketing strategies, explanation and sales forecast to make Milo become the market leader in Thailand. Models and concepts such as Ansoff’s Model, SWOT Analysis and Porter’s Five Forces Analysis are implemented to help us analyze external factors. Our group uses both primarily data from field survey and secondary data from a research firm, AC Nielsen Thailand, to help us gaining more insight and customers’ deeper perception toward the brand. This information provides solid foundation in the process of forming the effective marketing strategies for Milo.
Marketing Management: MILO Marketing Plan
2.0 SITUATION ANALYSIS
Nestlé’s Milo had entered Thailand market for decade and then become the second leader in chocolate/malt related products market. The brand from Nestlé, in the past, was consisted of many business units from UHT chocolate milk, chocolate/malt powder beverage, chocolate ice-cream, chocolate bar and chocolate cereal. However, some product lines started to shown not enough positive sign in term of sales volume. Nestlé Thailand, the company which core competency is the economy of scales model, then decided to outsourced the chocolate UHT, and ice-cream category to F&N Diaries (a major manufacturer of sweetened condensed milk from Malaysia), the chocolate bar to DKSH Group, Diethelm (market expansion service company). Nestlé’s Milo now markets only the chocolate/malt powder beverage and chocolate serial. This marketing plan will focus only the powder beverage business unit due to the major contribution of Milo brand comes from beverage category.
2.1 MARKET SUMMARY
1. Geographic Segmentation: Regions: Although people prefer to drink Milo throughout the year. But season can be used as criteria for Nestlé to segment the market. Our finding show that number of sales volume rose significantly in summer and winter, but not in rainy season. Cities: Cities take bigger responsible in Milo’s sales volume proportion compared to rural areas and villages as a result from different factors such income and education level. However, as the company focuses on economies of scales and mass Marketing Management: MILO Marketing Plan
communication, it should focus on making Milo available in every place that has people with purchasing power and demand. 2. Demographic Segmentation: Age: Currently, most portion of Milo’s target markets derive from children and old people. These tow group contribute most part of the Milo’s sales. However, Nestlé shouldn’t neglect other segments such as young adult and working people. Newly emerged trends such health conscious affect their consumption behavior, which perfectly fit for Milo. Gender: In the past, Nestlé tried to communicate Milo’s image as sporty and energize by using “young boy” endorsement to represent the concept. However, due to the changes in today social structure and sex proportion. Nestlé should commutate to female more, especially when they are the person who shop for their family, a buyer. Income and Occupation: People with high income and education level should be focused. This group of people is health conscious and willing to pay for product that benefits their well being. On the other hand, blue collar people still an attractive segment due to its higher proportion in Thailand’s social. The later can be targeted by...
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