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A study of maggi brand repositioning and extension - Document

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TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management PRODUCT AND BRAND MANAGEMENT T E R M PA P E R P R O P O S A L
A STUDY OF MAGGI BRAND EXTENSION AND REPOSITIONING I N T E R N AT I O N A L
MANAGEMENTINSTITUTE,NEWDELHIEXECUTIVEPOSTGRA
D U AT E D I P L O M A I N M A N A G E M E N T SUBMITTED TO:S U B M I T T E D B Y:
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TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management ACKNOWLEDGEMENT

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We hereby regard our sincere thanks to Prof...................., IMI New Delhi under
whose guidance this project was undertaken. We would like to thank our friends for
their generous support and the respondents who gave their valuable piece of time
for participating in the survey to complete the study. 2

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TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management

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TABLE OF CONTENTS
EXECUTIVE SUMMARY...042.
INTRODUCTION.....053.

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MAGGI BRAND IN INDIA.....054.

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BRAND STORY.......065.
PRODUCT VARIENTS....106.
MARKET SHARE.........117.
RESEARCH METHODOLOGY...........128.
OBJECTIVE...129.
RESEARCH PLAN..1210.

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DATA COLLECTION
PLAN...1311.
METHODOLOGY1312.
SURVEY RESULT..1413.
SWOT ANALYSIS OF MAGGI BRAND...1914.

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STPD ANALYSIS OF MAGGI BRAND.


2015. CUSTOMER-BASED BRAND EQUITY PYRAMID (CBBE)..
2116. BRAND PRISM OF
MAGGI...2217.
CONCLUSION.2318.
RECOMMENDATION.2319.
FUTURE PLAN.2420.
LIMITATION.....2421.
APPENDIX-1(QUESTIONAIRE)...253

TITLE : Maggis Brand Extension and Repositioning Subject: Product And Brand
Management
EXECUTIVE SUMMARY
The report entitled A study of Maggi Brand Repositioning and Extension deals with
the study of Maggi brand that was launched in India in the year 1983, by Nestle
India Limited, which became synonymous with noodles. This research paper tries to
find a solution to a reallife problem of Maggi to launch its products as a Healthy
Product. The introduction provides the company background, operational & other
important information provided by thec ompany which would assist in taking the
decision for the right brand extension strategy for Maggi.

TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management
INTRODUCTION
The industrial revolution in Switzerland in the late 1800s created factory jobs for
women, who were therefore left with very little time to prepare meals. This wide
spread problem grew to bean object of intense study by the Swiss Public Welfare
Society. As a part of its activities, the Society asked Julius Maggi miller to create a
vegetable food product that would be quick to prepare and easy to digest. Born on
October 9, 1846 in Frauen feld, Switzerland, Julius Michael Johannes Maggi was the
oldest son of an immigrant from Italy who took Swiss citizenship. Julius Maggi
became a miller and took on the reputation as an inventive and capable
businessman. In 1863, Julius Maggi came up with a formula to bring added taste to
meals. Soon after he was commissioned by the Swiss Public Welfare Society, he
came up with two instant pea soups and a bean soup - the first launch of the Maggi
brand of instant foods in 1882 - 83. Towards the end of the century, Maggi &
Company was producing not just powdered soups, but bouillon cubes, sauces and
other flavourings. The Maggi Company merged with Nestl in 1947. Today, Maggi is
a leading culinary brand and part of the NESTL family of fine foods and beverages.
Under the Maggi brand, which is today known world wide for quality and innovation,
Nestle offers a whole range of products, such as packaged soups, frozen meals,
prepared sauces and flavourings.
MAGGI BRAND IN INDIA
Maggi Comes to India teething troubles Maggi noodles was launched in India in
theearly1980s. Carlo M. Donati, the present Chairman and Managing Director of
Nestle India Ltd, brought the instant noodle brand to India during his short stint here
in the early eighties. At that time, there was no direct competition. The first
competition came from the ready-to-eat snack segment which included snacks like
samosas, biscuits or maybe peanuts, that were usually the bought out type. The
second competition came from the home made snacks like pakoras or sandwiches.
So there were no specific buy and make snack! Moreover both competitors had
certain drawbacks in comparison. Snacks like samosas are usually bought out, and
outside food is generally considered unhygienic and unhealthy. The other
competitor, homemade snacks overcame both these problems but had the
disadvantage of extended preparation time at home. Maggi was positioned as the
only hygienic home made snack! Despite this, Nestl faced difficulties with their
sales after the initial phase. The reason being, the positioning of the product with
the wrong target group. Nestle had positioned Maggi as a convenience food product
aimed at the target group of working women who hardly found any time for cooking.

Unfortunately this could not hold the product for very long. In the course of many
market researches and surveys, the firm found that children were the biggest
consumers of Maggi noodles. Quickly they repositioned it towards the kids segment
with various tools of sales promotion like colour pencils, sketch pens, fun books,
Maggi clubs which worked wonders for the brand.
Why the specific Brand positioning?
Maggi was positioned as 2-minute noodles with a punch line that said Fast to
cook! Good to eat! And this gave the implied understanding to the consumer that it
was a between meals snack. The company could have easily positioned the
product as a meal, either lunch or dinner. But, it chose not to do so, because the
Indian consumer mindset did not accept anything other than rice or roti as a meal.
Hence trying to substitute it with noodles would have been futile. The firm did not
position it as a ready-to-eat meal either, as the house wife prefers to make a
meal for her kids rather than buy it for them. And if she can make it in two minutes
with very little effort, then obviously its a hit with her! Whats more, if kids also love
the taste, the product is as good as sold! So the 2-minute fund a coupled with the
yummy taste worked !

BRAND STORY
Launched in 5 flavors initially Masala, chicken, Capsicum, sweet & sour, and
Lasagna Maggi had to fight hard to be accepted by Indian consumers with their
hard-to-change eating habits. The packaged food market was very small at this
time, Nestle had to promote noodles as a concept, before it could promote Maggi as
a brand. It therefore devised a two-pronged strategy to attract mothers on the
convenience plank and lure kids on the fun plank. Gradually, the market for
instant noodles began to grow. The company also decided to focus on promotions to
increase the brand awareness. In the initial years, Nestle promotional activities for
Maggi included schemes offering gifts( such as toys and utensils) in return for
empty noodles pack.
According to analysts the focus on promotion turned out to be the single largest
factor responsible for Maggis rapid acceptance. Nestles Managers utilized
promotions as measured to meet their sales target. Gradually, sales promotion
became a crutch for Maggi noodles sales. Later many of the Maggis extensions also
made considerable use of promotional schemes. The focus of all Maggis extensions
was more on below the line activities rather than direct communication. In addition
to promotional activities, Maggi associated itself with main stream television
program me and advertised heavily on kids program me and channels. After its
advertisements with taglines like mummi bhookh lagi hai, bas do minute and fast
to cook good to eat Maggis popularity became highly attributed to its extremely
high appeal to children. As a result, Maggis annual growth reportedly touched 15%
during its initial years.
Maggis Brand Extension
In 1998, Nestle launched Maggis first brand extension, Maggi soup. At this stage,
There was no organized packaged soup market in India. Nestle planned to create a
market for packaged soup as it felt the category had a lot of potential. However,

according to analyst, the company had introduced soups only to cash in on the
Maggis brand name, and was never very serious about the segment.
In 1993, Sweet Maggi, the first variant of Maggi noddles was launched. The
company supported the launch with a huge advertisement outlay that amounted to
75% of the total yearly expenditure on the Maggi brand. However, the product failed
to generate the desired sales volume and Nestle was forced to withdraw it. At the
end of the year, Maggi noodles was generating sales volume of around 5000 tons
and remained a loss making proposition for Nestle.
To boost sales, Nestle decided to reduce the price of Maggi noodles. This was made
possible by using thinner and cheaper packaging material, the company also
introduced money saver multi packs in the form of 2-in-1 pack and 4-in-1 packs.
As a result volume increases phenomenally to 9700 tones in 1994 and further to
13000 tones in 1995.Maggis euphoria was, however, short lived, as sales stagnated
in 1995 at the previous years level. With soup business being threatened by a new
entrant Knorr soups launched in1995, offering 10 flavors against Maggis 4 the
company started rethinking its strategies towards the soup market.
In order to stretch Maggis brand to include Indian ethenic foods the company tied
up with aPune based chordia foods to launch pickles under the year 1995. The
company also tied up with Indian foods fermentation (IFF), a Chennai based food
company to market popular south Indian food preparation such as sambher, dosa,
vada and spices in consumer packs in Dec1995. The company reportedly saw a lot
of untabbed potential in the market for ready to use south Indian market.
In 1996, products from these two ventures received lukewarm response from the
market ; sales were rather poor in the regions in which they were launched.
Analysts attributed the failure of these Maggi extensions to the fact that Nestl
seemed to be particularly bad at dealing with traditional Indian product categories.
Maggi noodles performed badly in 1996. Despite slow sales in the previous two
years, Nestl had set a sales target of 25,000 tones for the year. However, Maggi
couldnt cross even 14,000 tones. Adding to the company woes was the failure of
Maggi Tontis Special, a range of cooking sauces aimed at providing restaurantlike-taste to food cooked at home. The range included offerings such as Butter
Chicken gravy and tomato sauce for pizzas.
Understanding these failures, and buoyed by the fact that the Maggi brand finally
broke evenin 1997, Nestl continued to explore new options for leveraging on the
brand equity of Maggi noodles. The company realized that the kids who had grown
up on Maggi noodles had become teenagers by the late 1990s. As they associated
the product with their childhood, they seemed to be moving away from it. To lure
back these customers and to explore new product avenues, Nestl launched Maggi
Macaroni in July 1997. According to analysts, Maggi Macaroni was launched partly
to deal with the growing popularity of competing noodles brand Top Ramen. Maggi
Macaroni was made available in three flavors, Tomato, Chicken, and Masala. The
company expected to repeat the success of Maggi noodles with Maggi Macaroni. As
with most of its product launches, Maggi Macaronis launch was backed by a multimedia advertisement campaign including radio, television, outdoors and print media
with the tagline, Tum Roz Baby.

The products pricing, however, proved to be a major hurdle. A 75-gm Maggi


Macaroni pack was priced at Rs 11, while a 100-gm noodles pack was available at
Rs 9. According to analysts, Nestl failed to justify this price-value anomaly to
customers, who failed to see any noted value addition in Maggi Macaroni (packaging
and flavor variants were similar to those of Maggi noodles). In addition, customers
failed to see any significant difference between Maggi Macaroni and the much
cheaper macaroni that was sold by the unorganized sector players. The biggest
problem however was the taste of the new product. Since macaroni is thicker than
noodles, Maggi Macaroni did not absorb the tastemaker well and consequently did
not taste very good. The interest generated by the novelty of the product soon died
out and sales began tapering off. Eventually, Nestl had to withdraw Maggi
Macaroni completely from the market.
Nestl had not even recovered from Macaronis dismal performance, when it learnt
to its horror that Knorr had dethroned Maggi as the leader in the soup segment (end
of 1997). The only saving grace for Maggi seemed to its ketchups and sauces, which
were turning out to the rare successful extensions of Maggi. These products were
supported by a popular advertisement campaign for the Maggi Hot & Sweet sauce
brand. These humorous advertisements, featuring actors Pankaj Kapoor and Javed
Jafri, used the tagline, Its different. However, during mid-1997, HLL began
promoting its Kissan range of sauces aggressively and launched various innovative
variants in the category.
Nestl responded with a higher thrust on advertising and different size packs at
different price points. Though Kissan gained market share over the next few years,
Maggi was able to hold on to its own market share. Meanwhile the operational costs
of Maggi noodles had increased considerably, forcing the company to increase the
retail price. By early 1997, the price of a single pack had reached Rs 10. Volumes
were still languishing between13,000-14,000 tones.
Pricing and Product Development
It was at this point in time that Nestl decided to change the formulation of Maggi
noodles. The purpose was not only to infuse fresh life into the brand, but also to
save money through this new formulation. The company used new noodleprocessing technology, so that it could air-dry instead of oil-fry the noodles. The
tastemakers manufacturing process was also altered. As a result of the above
initiatives, costs reportedly came down by 12-14%. To cook the new product,
consumers had to add two cups of water instead of one-and-a-half cups. The taste
of the noodles was significantly different from what it used to be. The customer
backlash that followed the launch of the new noodles took Nestl by surprise. With
volumes declining and customer complaints increasing, the company began to work
on plans tore launch old Maggi to win back customers. In addition, in 1998, Nestl
began working out a strategy to regain Maggis position in the soup segment. To
counter the Knorr threat, the company re-launched Maggi soups under the Maggi
Rich brand in May 1998. The soups were not only thicker in consistency than those
produced earlier, the pricing was also kept competitive and the packaging was
made much more attractive. However, Knorr took Nestl by surprise by launching
one-serving soup sachets priced as low as Rs 4. HLL too launched two-serving
sachets of Kissan soup priced at Rs 7. As Maggi did not have any offerings in this
price-range, it lost a huge portion of its market share to Knorr.

The re-launch prompted market observers to compare Nestls move with US soft
drinks major Coca-Colas New Coke fiasco. However, the company disagreed, Its
a hard-5 nosed strategy, that mixes nostalgia with the consumers voiced
preference for the product it has been bred and rough up on. The reintroduction is
Nestls acknowledgement of the loyalty of the Indian mother and the child to the
original product. By May 1999, Nestls decision to bring back the old Maggi
seemed to have paid off. Two months after the re-launch, the monthly average sales
of Maggi noodles n the northern region rose 50% in comparison to the previous
year. In July 1999, Maggi the brand, was promoted as the biggest brand in Nestl
sport folio of brands in India, overtaking brands such as Nestum and Cerelac. Nestl
believe dt that Maggi had immense potential as it was a very flexible brand under
which regional variants could be introduced to meet various market needs.
Company sources claimed that with reasonable price points and innovative
products, Maggi could emerge as a top brand and a major growth driver for the
company. To further support the brand, Nestl carried out various promotional
activities as well. These included the August 1999 Fun-Dooz campaign and Jungle
Jackpot campaigns. 6 As a result of the above initiatives, Nestl claimed to have
cornered an 81% market share of the 20,000 tones noodles market by the end of
1999. Nestl sources claimed that Maggi noodles outsold the competition four times
over and that more than four Maggi noodle cakes were consumed every second in
the country.
PRODUCT VARIENTS
The product mix of Maggi is divided into various categories defined below. The
company has launched various products under each category as mentioned below.
1.

Noodles

Maggi 2-Minute Noodle ( Masala , Chicken, Curry and Tomato)

Maggi Dal Atta Noodles ( Sambhar taste)

Vegetable Atta Maggi Noodles

Maggi Rice Noodles (Lemon Masala, Chilly Chow and Shahi Pulao)

Maggi Cuppa mania (Masala yo, Chilli chow yo)

2. Sauces

Teekha masala

Tomoto chatpat

Imli khata mitha

Tomato ketchup

Hot and sweet

Tomato pudina

Ginger, Garlic & Coriander

Maggi Oriental Chilli Garlic

Ginger, Garlic & Coriander

3. Maggi Pichko
4. Soups Healthy

Chef Style
- Cream Mushroom
- Sweet Sour Tomato Noodles
- Tangy Tomato Vegetables

Home Style
- Creamy Chicken
-

Mixed Vegetable

Rich Tomato

Chinese Style
- Chinese Hot Sour Chicken
- Chinese Sweet Corn Chicken
- Chinese Sweet Corn Vegetables
- Chinese Hot & Sour Vegetables
5. Maggi soup sanjivni 10

Amla

Badam

Spinach

Dal

Tomato
6. Maggi bhuna masala

Bhuna masala for gravy dishes

Bhuna masala for vegetable dal

7. Maggi magic cubes

Chicken

Vegetarian masala
MARKET SHARE
Maggis Market Share in Ketchup Maggis Market Share in Noodles Category Category
20% 45% Maggi Maggi 55% Others Others 80%

RESEARCH METHODOLOGY
OBJECTIVES
To understand the influence of Maggi as a brand on consumers mind set.
Sources of Brand equity of Maggi like Brand awareness, Brand image, Brand
association, Brand
recall
To understand the Brand performance of Maggi products. 11
To understand Brand Imagery, Brand Quality perceived by customers, Brand
credibility, consideration, superiority and feelings.
Brand Extension of Maggi in terms of product diversity.
Analyse the repositioning of Maggi brand as a Healthy product and the
consumers perseverance towards the same.

RESEARCH PLAN
Research Design
The research will be carried out in the form of a survey which will be done in areas
near to Delhi (NCR region). The population has been segmented on the basis of
salary Group and Age Group.
Sample Design
The target population for our study is households. The sample will be selected by a
simpler and om sampling method.
Sample Size
The sampling unit is 150 which are divided as follows : Number
of
respondents
Age-group
Monthly
Household
Income
Survey Locations

150
10 45
25000 - 75000 INR
Delhi,
Faridabad,
Gurgoan, Noida, Greater
Noida

Salary
No
Group
income
Number of Respondents

25K - 40K

60K - 40K

60K 75K

30

50

70

Age Group

10 - 25

25 - 35

35 45

Number of Respondents

50

50

50

DATA COLLECTION PLAN


Data Gathering
This study involves data collection (primary research) from different households in
four different areas Delhi, Faridabad, Gurgoan, and Noida.
Literature Review
The research conducted as a part of our study would include Primary as well as
Secondary research. Primary research would include a survey that would be
conducted in selected localities of Delhi and nearby areas where the responses of
consumers would be recorded through a designed questionair. Secondary research
would include various aspects of Brand management through Internet, Journals,
company reports , expert views etc.
METHOLODOGY
The research will be carried out in the form of a survey. This will include primary
research in addition to secondary research as stated below. The survey research
method will be descriptive research design. Each respondent will be interviewed
through a Questionnaire. The sample will be selected by a simple random sampling
method. The survey will address the following information area:
Information Areas
The objective as spelt out can be elaborated into specific information areas to be
studied.
How do customers perceive Maggi as a stable brand, their perception of
noodles and how do they associate themselves with Maggi?
Are the consumers aware of Maggi Brand or they associate noodles with
some other brand?
Do they consider noodle as a healthy product or they are aware of the
companys strategy of repositioning it to a healthy product by the launch of
some of the new products?
Which product from the entire basket of Maggi products do the consumers
consider as the best selling product for Maggi and to which the consumers
frequently buy?
Are the consumers willing to accept Maggi brand extensions to some other
products like chocolate, juices, chips etc? 13
SURVEY RESULTS
Brand Associations
Sources of Brand equity like brand association of Maggi as a Brand was found
highest with the age group of 10-25 and the product category associated with it was
the noodles category( see exhibit 1). Consumers in the age segment of 10-25 could
easily relate Maggi to noodles.

In the income wise category the brand association was highest with the income
group of25k-40k were more than 40 respondents associated Maggi with noodles
( see exhibit 2). The implications from the findings discussed above seem that
Maggi has good brand association in terms of noodles. Consumers presume Maggi
as Noodles and the companys philosophy of projecting the brand as noodles brand
seem to be viable in this regard.

Brand Association(Age wise)


40 35 30 25 10yr - 25yr 20 15 25yr - 35yr 10 35yr - 45yr 5 0 Noodles Fast Food
Snacks None of These Exhibit 1
Brand Association(Income wise)
50 40 Noodles 30 Fast Food 20 Snaks 10 None of These 0 No Income 25K - 40K 40K
- 60K 60K - 75K 14
Exhibit 22.
Brand Recall
From the Exhibit 3 & 4 given below it seems a clear trend that Maggi has a good
brand recall as compared to its competitors like Top Ramen, Surya noodles etc.
Consumers could easily associate Maggi with noodles. In the Age wise category, the
respondents of the age group of25-45 were highly cautious of Maggi brand and
seemed to be consuming Maggi more as compared to other age segments.
Brand Recall(Age wise) 50 40 30 10yr - 25yr 20 25yr - 35yr 10 35yr - 45yr 0 Maggi
Top Ramen Surya Anil Noodles Noodles Exhibit 3
In the gender wise category the companys strategy of positioning of Maggi brand
for workingwomen seems to be adaptive and gaining shape as women respondents
had a brand recall more than male. Brand Recall(Genderwise) 25 20 15 Brand
Recall(Income wise) 10 Maggi 50 5 Top Ramen 40 0 Surya Noodles Maggi 30 Anil
Noodles M M M M e e e e a a a a Top Ramen l l l l m m m m e e e e a a a a F F F F l l l
l 20 Surya Noodles 10 No Income 25K - 40K 40K - 60K 60K Anil Noodles - 75K 0 15
No Income 25K - 40K 40K - 60K 60K - 75K
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management Exhibit 33.
Brand Awareness
From the responses of the respondents in the conducted survey it was evident than
Maggis Brand awareness was very high in terms of noodles were around 65 %of the
respondents associated maggi as noodles and only 20 % of the respondents knew ,
Maggi as a Ketchup,9% as soup etc.
Masala Brand Awareness 6% Soup 9% Ketchup 20% Noodles 65%
The trend indicated that Maggis brand extension strategy to increase its basket has
not been quite successful in other food segments .This might be because of the

larger share of market captured by the competitors hence Maggi has a high
potential in markets like ketchup, soup set.
Brand Awareness(Age wise) 40 35 30 25 10yr - 25yr 20 25yr - 35yr 15 10 35yr 45yr 5 0 Ketchup Noodles Soup Masala 16
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management4.
Repositioning Maggi as a healthy product
The companys strategy to reposition Maggi as a Healthy product was not found
conducive as per the survey results. The survey showed that consumers did not
perceived Maggi as a healthy product with 53% of them consumed Maggis
traditional products as compared to the rest who consumed other variants of
Maggis brand that were positioned as Healthy products.
Maggi rice Repositioning Awareness noodles mania Others 7% 3% Maggi dal atta
noodles 14% Maggi masala Maggi (Regular) vegetable atta 53% noodles 23%
From the pie chart given below it can be clearly seen that Maggi is still perceived as
a non healthy products by the consumers and in spite of the efforts to position
Maggi as a healthy product by the company the brand is still perceived as a ready
to eat food brand that has a high market share in the noodle category in India.
Perception of Maggi Noodles As a Healthy Product 40% As a non Healthy Product
60% 17
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management Tasty/Fun Perception of Maggi Product Eating Good for 10% Health
15% Junk Food 23% Ready to Eat 52%
SWOT ANALYSIS OF MAGGI BRAND
The SWOT analysis of Maggi brand clearly indicates the strengths of Maggi as a
Brand in Indian market. The Brand was found to be a leader in its category of
Noodles, with strong customer loyalty. Intensive distribution of Maggi as a Brand
was seen in urban areas of the country. The major threats of the brand as shown in
the figure below indicates that Maggi has made several attempts to revamp itself as
a Healthy Product but till date its perseverance towards the tag line is low by the
consumers. The brand is in the growth stage of product lifecycle with a strong
inclination towards the maturity stage. 18
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management
STRENGTH WEAKNESS Market leader in their segment Product are dependent on
each Strong brand loyal consumer base other Wide range of distribution channel
Not so much presence in rural Product according to the need of market Indian
consumer Innovative Product SWOT ANALYSIS OPPORTUNITY THREAT Increasing
number of working youth Price war with competitors. Product has been acceptable
in youth Strong presence of regional category competitors Shift to rural market
Consumers dont perceive it as Changing preference of consumer a Healthy

Product towards Chinese food and fast food. Can foray into other food markets with
its strong Brand name
STPD ANALYSIS OF MAGGI BRAND
Segmentation: Market Segmentation divides the heterogeneous market into
homogenous groups of customers who share a similar set of needs/wants and could
be satisfied by specific products. Maggi Brand have segmented the market on the
basis of lifestyle and habits of URBAN FAMILIES.
Target: Market Targeting refers to evaluating and deciding from amongst the
various alternatives, which segment can be satisfied best by the company. The
Maggi Brand have mainly targeted the Kids, Youth, Office Goers & Working Woman
which falls into the category convenience-savvy time misers who would like to get
something instant and be over with it quickly.
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management
Positioning : Market Positioning is the act of designing the companys offerings
and image to occupy a distinctive place in the minds of the target market. The goal
of positioning is to locate the brand in the minds of consumers to maximise the
potential benefit to the firm. Maggi has positioned itself in the SNACKS category and
not in the meal category since Indians do not consider noodles as a proper food
item. Therefore Maggi have developed its brand image of instant food products with
positioning statements such as 2 minutes noodles and Easy to cook, good to
eat.
Differentiations: Points-of-difference (PODs) are attributes or benefits consumers
strongly associate with a brand, positively evaluate and believe they could not find
to the same extent with a competitive brand. The Maggi Brand have also
differentiated its brand image from its competitors in terms of taste, flavours and
packaging. Maggi have launched wide varieties of products in different flavours
which can attract larger set of customers. Maggi products are also available in
different sizes catering to different customer needs.
CUSTOMER BASED BRAND EQUITY PYRAMID (CBBE)
Maggis customer based brand equity pyramid seems to be equally strong on left
hand side and right hand side, it is also strong from bottom to top enjoying the
highest brand awareness of any fast food noodle brand in India as well as repeat
purchase rate and high customer loyality. 20
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management zzz BRAND PRISM OF MAGGI 21
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management BRAND PRISM OF MAGGICONCLUSION 22
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management
The food processing business in India is at a nascent stage. Currently, only about
10% of the out put is processed and consumed in packaged form thus highlighting

huge potential for expansion and growth. Traditionally, Indians believe in consuming
fresh stuff rather then packaged or frozen, but the trend is changing and the new
fast food generation is slowly changing.
Riding on the success of noodles, Nestle India, tried to make extensions of the
Maggi brand to a number of products like, sauces, ketchups, pickles, soups,
tastemakers and macaroni in the mid-1990s. Unfortunately, the macaroni and
pickles didnt pick up as expected. The soups and sauces did somewhat fine,
gathering considerable sales volumes and have a satisfactory presence even today.
Maggi Noodles itself faced a bit of difficulty with respect to taste, and nearly lost
its position in the minds of Indian consumers in the late 1990s. When Nestle
changed the formulation of its tastemaker, the ominous packet that came along
with Maggi Noodles, a major chunk of consumers were put-off and sales started
dropping. Also, Maggis competitor Top Ramen took advantage of the situation and
started a parallel aggressive campaign to eat into Maggis market share. But the
company quickly realised this and went back into making the original formula
coupled with a free sampling campaign. This helped Maggi to win back its lost
consumers and pushed up its sales volumes again!
Maggi Today The year 2008 saw India leading in world wide Maggi sales. The brand
has grown to an estimated value of Rs 160-170 crore and contributes at least 89%
to Nestle Indias top line. All the same, some FMCG analysts feel that the brand has
not done much to expand the noodles category. Even after 25 years of its launch,
the size of the instant noodles market is yet quite small at Rs 300 crore. But yes, the
parent company, Nestle India Limited has certainly encouraged the brand to enter
into other culinary products.
RECOMMENDATION
After the conducted study following recommendations could be sited for Maggi
Brand.
To gain maximum leverage in terms of profit the company should pay emphasis
on segments with age groups 25-35 and above .Advertising is the key to
success. Targeting these segments will not only enhance the companys profit
margins but also it will leverage the brand image of Maggi.
The company should advertise its products by depicting attributes related to
Health like Nutrition values, % of Vitamins, Proteins etc. This would help in
customers perceiving the product as Healthy.
Foray into other food products like chips, chocolates etc under its sole brand
name would not only help in Brand extension but will also enhance Maggis
market share. 23
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management
FUTURE PLANS
Nestl Indias objective is to manufacture and market the companys products in
such a way so as to create value that can be sustained over the long term for
consumers, shareholders, employees and business partners.

Maggis aims to create value for consumers that can be sustained over the long
term by offering a wide variety of high quality, safe food products at affordable
prices.
The company continuously focuses its efforts to better understand the changing
lifestyles of modern India and anticipate consumer needs in order to provide
convenience, taste, nutrition and wellness through its product offerings.
LIMITATIONS
The present study is confined to a minimal sample size and may not reflect the
opinion or response of the entire population in general. The results of our study are
entirely confined to the responses of the Delhi consumers and might deviate in
terms of actual population as a whole. Recommendations given after the study are
entirely dependent on the survey and the secondary analysis done in the report.
APPENDEX 1
QUESTIONAIRE
When you fill in this questionnaire please use a pen and mark () on the best
response.
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management
Q-1 what product would you associate with the tag line mentioned below?
Its different. ..
Dont be a noodle, be a snoodle.
2 minute noodles/ Bas 2 minute.
Jitna tasty, utna healthy..
Mummy bhook lagi
Try it with a twist ..
Hearty soups warm you from inside ..
Fast to cook, Good to eat
Q-2 What comes first in your mind when you hear the word Maggi ?
Noodles
Fast food
Snacks
None of these
Q-3 what is the brand that comes to your mind when we say the word noodles?
Maggi
Top Ramen

Surya Noodles
Anil Noodles
Q-4 Rank the following Maggi products w.r.t. frequency of purchase with 1 being the
highestrank RANK Noodles _________
Ketchup _________
Soup _________
Pickles _________
Cubes _________
Q-4 With what products would you associate the brand Maggi?
Ketchup
Noodles
Soup
Masala
Q-5 On a scale of 1 to 5 rate Maggi on the following parameters
Taste ____________
Variety/Flavours ____________
Hygiene/Purity ____________
Availability ____________
Packaging (SKUs) ____________
TITLE: Maggis Brand Extension and Repositioning Subject: Product And Brand
Management
Q6 Rank the categories which Maggi should look in future in order of your
importance :
Chocolates _____________
Salted Potato Chips _____________
Fruit Juices _____________
Processed foods(Ready to use pastes, masalas) ____________
Others ( Please mention) _____________
Q-7 how do you rate Maggi brand in terms of following parameters:
Expertise (Competent, Innovative, Market leader)
Trustworthiness (Dependable and keep customers interest in mind)
Liability ( Fun ,interesting)

None of theseQ-8 How do you perceive Maggi products?


Good for health.
Ready to eat.
Junk food
Tasty / Fun eating
Q-9 Which Maggi products in noodles category do you regularly buy? (Repositioning
awareness)
Maggi masala Maggi vegetable atta noodles
Maggi dal atta noodles
Maggi rice noodles mania
Others
Q-10 Do you perceive Maggi noodles as a healthy product?
Yes
No
Q-11 If No then your suggestions for improvement as a healthy product?
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_ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _Profile Sheet 26
Age :
Sex :
Profession :
Monthly Income :
Marital Status :

Thank you for your answers. It has been a pleasure interacting with you. 27