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Table of Contents Title Introduction About Nestlé Nestlé Bangladesh Limited Core Brands in Bangladesh Sales promotion Sales Promotion in Nestlé Bangladesh Limited Major sales Promotion Tools Trade promotion Tools Consumer Promotion Tools Process of Developing Sales Promotion Program Communication Medium Factors to consider before launching sales promotion Conclusion Page No. 1 1 2 3 3 4 4 4 5 7 8 8 9 .
chocolate and confectionery. Crunch…. ice-cream.Introduction Sales Promotion is a most commonly used phenomenon in today’s business world. Perrier. KitKat. Nestlé is a very focused Company. Nestlé is present around the globe.000 cups of Nescafé are consumed every second. So most of the business firms consider it as an important marketing tools. instant coffee. It is the subsidiary of it’s mother company world’s largest food and beverage manufacturer Nestlé S. Before going to the discussion of sales promotion in Nestlé Bangladesh Limited we will first know the company.A. In most of these product groups and in most markets. culinary products. Nestlé Bangladesh Limited is food and beverage manufacturer. frozen ready-made meals. with around 230. Many of its brand names are world familiar: Nescafé.000 people working in more in an 84 countries with 466 factories and with sales representatives in at least another 70 countries. with more than 94 percent of the sales coming from the food and beverage sector.Some of its products have broken records: 3. Nestlé is the leader or at least a strong number two. Nido. It’s two way benefit is that it helps to increase sales as well as it increases customer loyalty. mineral water etc. Friskies. milk products. on all continents. Nestlé covers nearly every field of nutrition: infant formula. About Nestlé Nestlé is the world's largest food group not only in terms of its sales but also in terms of its product range and its geographical presence. and KitKat merited an entry in the Guinness Book of World Records as the world's best-selling chocolate bar with 418 KitKat fingers eaten every second around the world! . Smarties. Polo. They are also a major producer of pet food. Milo. Maggi.
In 1998.000. .00 Crore sales in 2008 ( that is 6. Nestlé Bangladesh's vision is to be recognized as the most successful food and drink Company in Bangladesh. generating sustainable.A.000 employees 456 factories in 84 countries Core Brands Nestlé Bangladesh Limited Nestlé Bangladesh Limited started its first commercial production in Bangladesh in 1994.Key Information About Nestlé S. World’s Largest food Company Founder: John Heinrich Nestle in the year of 1967 Present in all countries Tk. 7.2 times of is year Bangladesh Budget) Over 280. profitable growth and continuously improving results to the benefit of shareholders and employees.
the factory produces instant noodles. concentrating on its core competencies and their commitment to high quality. is a strongly positioned organization. cereals and repacks milks. Total Employee 437 nos 560 Core taka sales in 2008 Total # of Distributor 78 Total # of Outlet 100000+ Core Brands In Bangladesh: . • • • • • First commercial production start from 1994. 55 km north of Dhaka. beverages and infant nutrition products.The factory is situated at Sripur. Today Nestlé Bangladesh Ltd. with the aim of providing the best quality food to the people of Bangladesh. soups. The Company will continue to grow through the policy of constant innovation and renovation.
Common types of trade promotion activities include price discounts and allowances. Sales Promotion in Nestlé Bangladesh Ltd. . and a variety of frequent buyer programs.Nestlé Bangladesh Limited divides its core brands into two categories: 1.Food and Beverage category Nido Maggi Nescafe Lactogen Cerelac Sales Promotion Sales promotion is the activity that provides special incentives to bring about immediate response from consumers. In effect. contests. Trade promotions refer to those activities designed to encourage distributors to purchase additional volume and provide additional support to stimulate consumer purchase. co-operative advertising funds. trade promotions help push the product through the distribution channel. Common type of consumer promotion activities include coupons. Consumer promotions refer to those activities that are designed to stimulate consumer purchase.Infant category 2. cash-back offers. distributors and organization’s sales force. free sample offers. in effect to help pull the product through the distribution channel. and point –of –purchase display materials. Sales promotion activities can be divided into two broad categories: consumer promotions and trade promotions.
but they use both of them when it is necessary. As a part of their marketing strategy Nestlé also use sales promotion to accomplish their objectives. Trade promotion 2. Communicates to the . Nestlé Bangladesh Ltd use two types of sales promotion: 1.Nestlé Bangladesh Ltd is one of the leading food and beverage manufacturer in Bangladesh. give it shelf space. Major Sales Promotion Tools Used By Nestlé Bangladesh Ltd. promote it in advertising and push it to consumers. uses trade promotion to persuade its retailers to carry its brands. Consumer promotion Trade Promotion Tools Nestlé Bangladesh Ltd. Basically they prefer trade promotions than consumer promotions. They consider ‘Quality’ as their most valuable product. Still they have to face tremendous competition from their local and global competitors.
retain outlets or traders. For example. Then retailers encouraged to purchase more and more products and push them to the ultimate shoppers or consumers. Retailers are asked to purchase a fixed amount of product to get the free product. Following techniques they most frequently use as trade promotion: Cash discount In this method retailers are encouraged to purchase a large volume of product at a discounted price. In Nestlé trade promotions are directed towards the retailers. Normal price of per case MAGGI noodles is TK. distributors. Then they sell it to the retail outlets at a price including their commission. Free products By following this technique Nestlé offers retailers free product on a fixed amount purchase. Distributors collect the product from the Nestlé factory at net product price. . 600. Then the retail outlets or traders sell the product at maximum retail price.Figure: Trade promotion in Nestlé Bangladesh Ltd. 550 per case. Nestlé has 78 distributors around the country. Nestlé set the conditions to get the discount. They may ask retailers to buy 5 cases at a time at TK. In Nestlé Bangladesh Ltd. and shoppers and consumers. They persuade them to sell more and more and receive special benefits. For instance. When a retailer purchase a fixed amount of product then he becomes eligible for the discount. they may asked to the retailers to purchase five cases of MAGGI noodles to get two packets extra with each case. Product supply chain consists of Nestlé itself.
Consumer Promotion Nestlé Bangladesh Ltd. Sometimes they offer special trip. Special Drive In this technique Nestlé encourage the retailers to sell more and more product throughout the season. uses consumer promotion urge prompt purchase from the customer and create long term relationship with the customers. In return they attractive benefits to them. Communicates directly to the Figure: Consumer promotion in Nestlé Bangladesh Ltd. . and other attractive prizes.
or other creative activities to be judged by a panel that will select the best entries.In consumer promotion Nestlé communicate directly to its target market then the purchasers come to the retailers and demand the product. All benefits enjoyed by the consumers. Premium to the purchasers to may be related to the product. Often the condition is that an empty pack of that particular product have to be attached with the entry. Contest In consumer sales promotion Nestlé also offers cash discount for the consumers. This gifts product or may not be related to the sometimes they offer ‘Coffee Mug’ with with MAGGI soup. NESCAFE or small bowl Sometimes Nestlé offers special gifts encourage prompt purchase. Most commonly used consumer promotion tools for Nestlé are following: 1. In this technique they reduce the price of the product to get the higher sales volume or new customers for the product. For example. 3. In this method Nestlé calls for consumers to submit an entry – essays. In this promotion distributors and retailers don’t get any benefit. . Cash discount Process of Developing Sales Promotion Program in Nestlé Bangladesh Ltd. So it is a pull process for them. 2. drawings. For example sometimes the reduce the price of MAGGI noodles for a particular period of time.
000 cases Value of Incremental Sales = 10000 × 600 = TK.000 cases In this situation if the company think of a trade promotion to launch where it would cost TK.000 – 30.00.Product Cost ( Cost of goods sold + distribution Cost + other fixed costs) ROI ( Return On Investment) = on average 20% .000 cases Price per case = TK.50% For example. Incremental Marginal contribution = 60. 20 per case then they do the calculation as following: Projected Sales during promotion = 50. Say. 600 Marginal Contribution = 20% In a particular month company’s SKU comes to 60.00.000 × 20% = Tk.000 cases Incremental Sales = 40. The terms they frequently use are following: SKU = Store Keeping Unit AMS = Average Monthly Sales Incremental Sales = Projected Sales – AMS Marginal Contribution (MC)=Sales.000 .000 = 10.000 Marginal contribution = 20% So. 12. AMS for MAGGI Noodles is 30.Before launching a sales promotion ‘sales team’ of Nestlé Bangladesh Limited do a number of calculations. 60.00.
4. 8. 12.00. Preparation .00. 8.00.000 ROI ( Return On Investment) Incremental Marginal contribution = Tk. Mediums they use are following: News paper Magazine Television Radio Posters Bunting Dangler etc Factors To Consider Before Launching a Sales Promotion Program 1.000 × 20 = TK.000 = Tk.00.Cost of Promotion = 40.000 Less Cost of Promotion Profit = TK.000 Communication Medium Nestlé Bangladesh Limited use different mediums to communicate the sales promotion.
To make a sales promotion program successful Point of sales materials is necessary. It will inform a well as support the promotion. Nestlé Bangladesh Limited always manage to get proper media support. 5. Nestlé Bangladesh Limited prepare different packages for the product they are going to promote. Nestlé Bangladesh Limited believe that without channel members help it is not possible to run a sales promotion program. Normally it takes one month to six month to prepare for a sales promotion. 3. Packaging For consumers promotion special packaging is necessary. Media Support Media support is vital for the success of a sales promotion program. POSM( Point of Sales Materials) . Specially consumer promotions takes long time to prepare.Nestlé Bangladesh Limited takes proper preparation before launching a sales promotion which leads to the success of the program. Channel Members Support 4. Nestlé Bangladesh Limited prepare different point of sales materials and place it rightly during sales promotion. 2. Both in trade promotion and consumer promotion co-operation from the channel members are necessary. Before launching a sales promotion they contact with the media and book air time paper space.
By using valuable marketing tools they are creating competitive advantage for themselves which ultimately helping them to reach their marketing as well as organizational objectives. Again their successful sales promotion program are making profit as well as customer base for their company.Conclusion Finally we can say that Nestlé Bangladesh Limited is using sales promotion activities perfectly. .
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