Marketing Management II – Term III

MARKETING PROJECT – Group 9 Batch 1

Studying Nestle’s Milo

Submitted to:
Prof. Meenakshi Nagarajan

Submitted by:
Aditya Kwatra – 19PGDM009
Arushi Chaturvedi – 19PGDM019
Ashish Sharma – 19PGDM020
Bhawna Chaube – 19PGDM024
Ruchira Banerjee – 19PGDM053
Shubhika Chohan – 19PGDM060
Vanshika Kharbanda – 19PGDM068
 Table of Contents
ABOUT MILO.............................................................................................................................................. 1
4 Ps ................................................................................................................................................................ 1
1. PRODUCT ............................................................................................................................................ 1
3. PROMOTION ....................................................................................................................................... 3
4. PRICE ................................................................................................................................................... 4
MARKET SEGMENTATION OF NESTLE’S MILO ................................................................................. 5
CONSUMER BEHAVIOR ........................................................................................................................... 6
TARGETING ................................................................................................................................................ 6
POSITIONING ............................................................................................................................................. 7
MILO SUBSTITUTES ................................................................................................................................. 7
PEST ANALYSIS ........................................................................................................................................ 8
COMPETITOR & INDUSTRY ANALYSIS ............................................................................................... 9
1. INTERVIEWING PRIMARY SEGMENT-CHILDREN BETWEEN 7 & 12 YEARS ..................... 10
2. RETAIL STORES AND RETAILERS OBSERVATIONS AND INTERVIEW .............................. 11
A) RELIANCE SMART ......................................................................................................................... 11
B) SHIV GANGA SUPER MARKET 3D PVT. LTD. .......................................................................... 13
C) D-MART SUPERSTORE .................................................................................................................. 13
D) OM GENERAL STORE .................................................................................................................... 14
RECOMMENDATIONS ............................................................................................................................ 15
ANNEXURES ............................................................................................................................................ 16
A. PACKAGING ................................................................................................................................. 16
B. ADVERTISING .............................................................................................................................. 16
C. COMPETITOR ANALYSIS .......................................................................................................... 17
D. PRIMARY DATA – RELIANCE SMART .................................................................................... 18
E. PRIMARY DATA – SHIV GANGA SUPER MARKET 3D. PVT LTD. ..................................... 20
F. PRIMARY DATA - DMART STORE ........................................................................................... 21
REFERENCES ........................................................................................................................................... 22
 ABOUT MILO

Milo is a nutritionally superior product powered by ACTIV-GO™,

which contains PROTOMALT®, which is a unique malt extract, and a
specifically designed combination of 9 essential micronutrients that
support efficient energy release in the body. Milo has a great legacy of
more than 85 years during which it has nourished young children and
champions by providing them with the energy and inspiration to grow
with sports. Over 36 million people consume MILO around the world
and the product is available throughout 50 counties. MILO was
relaunched in India in August 2019.

4 Ps
We will be using the Marketing Mix to analyze Nestle India’s MILO. It will include the study of MILO’s:
 Product
 Place
 Price
 Promotion

1. PRODUCT
Nestlé strives to gain confidence of customers and to track and predict market trends, generating and
reacting to demand for its goods. This is motivated by an intense sense of success that adheres to the laws
of free competition within a specific legal structure and benefits them. Milo is a perfect example of superior
quality, proprietary technologies and direct sale to customers. Milo has been in the market for around
decades.
1.1 Product Item Depth
Milo is a well-known brand across the world and had several ranges of products under it across the globe.
In India, however, it recently re-launched its malt beverage.
• Milo Chocolate Drink
Milo chocolate drink is a superior product when it comes to nutrients because it is powered by ACTIV-
GO™, which contains PROTOMALT®(a unique malt extract) and also a carefully formulated combination
of nine vital micronutrients (vitamin B2,3,6,12, C and D and some essential minerals namely calcium, iron,
phosphorus) that promote the release of efficient energy in the body.”
1.2 Product nutrition
Every Milo product has 3 main components:
• The goodness of malt, skimmed milk, & cocoa that comes naturally in the product.
•ACTIGEN-E ~ a blend of 8 vitamins and 4 minerals that enhances the release of energy in body.
We have two major nutrient groups- the macro-nutrients, and the micro-nutrients. Macro-nutrients are
required every day in huge quantities to run the system (10s / 100s of grams).
• PROTOMALT ~ A malt extract with a combination of various carbohydrates supplying the body with
energy and nutrients. PROTOMALT is patented to Milo powder, a premium malt extract that contains a
combination of multiple forms of carbohydrates that meet the body's needs for energy and nutrients.
1.3 Product branding
Branding is nothing but a set of characteristics that customers expect from a commodity that will have a
direct effect on their buying decision. Branding can be done by means of a brand name-it can be

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implemented universally or on an individual basis, as Milo does it. Milo offers unique benefits to
its customers, including premium quality, consistency and value for money, with those standards building
up over several years. A company also considers a brand name as the most valuable intangible asset. Repeat
purchases signify customer loyalty in the market and are the key to profitability, a brand identity is crucial
to the success of a company. The important ingredients for any brand image include having a distinctive
brand name and packaging, although the actual nature of a brand identity lies in the mind of the customer
which is centered towards the product expectations. An organization must be continually aware of these
expectations and do promotions continuously in order to maintain and expand on them.

1.4 Product Packaging (See Annexure A)

Milo Nestlé's packaging is the biggest and most effective form of communication the brand has towards
customers. The firm conveys the health benefits of Milo in its beverage business. Milo is likewise present
in the confectionery, condiments, and nutrition correspondence to new and existing customers.
 The relaunch of Nestle’s Milo in India involved introduction of the Milo Ready to Drink (RTD)
packaging. The RTD pack has low sugar content with less than 10 grams of added sugar per pack
(180ml). The RTD tetra pack is priced at INR 30 and is available in major urban centers as well as
e-commerce platforms.
 The most-purchased Milo variant in terms of size is the MILO Activ-Go Powder Pouch Nutrition
Drink (400 g). This is priced at an MRP of INR 215 and can also be purchased from e-commerce
platforms at discounted rates.
 The 400g Activ-Go variant is also available in tin-packaging, which helps preserve the product for
a longer time and is eco-friendlier and more reusable. It is priced at INR 230 per tin.
 The Milo Activ Go Health Drink’s smallest size available in India is the 250 gm (Refill Pack),
which is priced at INR 140. It is used generally when the larger packs are almost over.
 Though the 20gm Milo sachets have not been launched in India thus far, they are commonly found
in unorganized retail stores in New Zealand and Australia.

1.4.1 Eco-friendly packaging

Packaging of any product is fundamental for sanitation. It assists in minimizing wastage before and after
purchase alongside keeping up the freshness for the customer. The Nestle strategy for sustainability depends
on improving materials, creating eco-friendly packaging, and giving important data to buyers on reusing
and disposal.
A key activity in 2008 was their coordinated effort on PIQET, which was a significant new packaging eco-
plan tool embraced by the company.
Nestlé is highly dedicated to discovering packaging innovations that add to a superior environment. The
organization underpins a coordinated methodology that promotes recycling, source reduction and energy
conservation. They attempt to utilize recyclable packaging materials to the maximum extent possible.

1.4.2 Packaging Source Reduction

During 1991, Nestlé started a periodic survey and appraisal of packaging source reduction opportunities.
Consequently, packaging material reserve funds from 1991 to 2008 added up to 392 000 tons and CHF 683
million worldwide.

1.5 Product Differentiation

1.5.1 Improve the packaging
Nestlé Milo has improved the packaging by substituting the bygone one with the newer version that sports
an interesting picture. Prior to this, Milo just had their brand name on the package. However, these days,
Milo has experienced changes and uses images of national athletes to pull in more customers. In addition,
Milo has also worked on the green shade of the bundle, which is their primary color, to make it more vibrant.
This improvement can draw in youngsters to drink Milo. By doing this, Milo will be able to engage with

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consumers and create brand recall, thus building loyalty. It also enables them to differentiate themselves
from their competitors in India and abroad.
1.5.2 Milo product enhancement
By understanding their customers’ needs, Nestle MILO has been able to enhance their product offering by
coming up with ‘3-in-1-MILO’. This is for those customers that do not have enough time or are generally
in rush because they only need a short time to make it. This is because 3 in 1 Milo already has added creamer
and sugar for consumer convenience. Indeed, even children can prepare Milo by themselves without
requiring any supervision or any added supplements.
1.5.2.1 Add more ingredients
To separate Milo from other products in the market, they have produced a healthy variant of Milo by
including cereal in Milo Fuze. This Milo is appropriate for buyers who worry about health and are on diets
since cereal can keep individuals from feeling hungry and contain fiber, which is good for digestion. Milo
additionally contains a ton of nutrition which is missing in competitor's products, for example, Oligo Coco.

2. PLACE
Place relates to the decisions that a company takes regarding the storage and transportation of products and
includes selecting the various distribution channels. These decisions are critical to the success of any
organization. By taking effective inventory management decision, the company can decrease costs and
enhance product quality. Choosing the right distribution channel is a major decision (selling through
middleman firms or directly to the end-user). Direct energy cost pressures have eased down in recent times.
Distribution channels decision includes geographical considerations with respect to location of
manufacturing plant.
One of the reasons for failure of Milo in India was not having a wide distribution strategy. The competitors
of Milo – Bournvita, Complan and Horlicks lead the market as they had strong distribution channels.
Revival of Milo was largely influenced by the product positioning and changes in channel functions among
other factors.
There are two types of channels used:
1. Retailer
2. Wholesaler
These channels have their own functions:
1. Transactional Function - Contacting, promoting, negotiating and risk taking
2. Logistical Function – Physically distributing, storing and sorting
3. Facilitating Function – Researching and financing

3. PROMOTION
The main idea behind Milo’s promotional strategy is to try and convince its target customers that their
product has a differential advantage over their competitor’s product. Differential advantage is a wide set of
unique features in a company’s product (say high product quality, low prices, excellent service) that the
target market considers not only significant but also superior to the competitor’s product. For example,
Milo has convinced their customers that if children consume Milo, they will be more energetic.

Nestle is also using other forms of advertising in order to promote Milo such as various non-media
communication or advertising. Some ways that Nestle has done this is by participating in exhibitions,
sponsorship activities, public relations activities and other sales promotion such as giving freebies with
their product, or reduced price offers. These are the tools used by Nestle to build a relationship with their
customers.
3.1 Advertising

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Advertising, in simple terms, is a form of paid, non-personal promotion of ideas, goods, or services. The
communication often aims at creating a creative slogan in order to make sure that the consumer remembers
it and with it, remembers Milo.
Different types of Advertising Media used by Nestle for Milo are mentioned below:
•Television
Nestle came up with a commercial advertisement where we can see young boys and girls becoming more
energetic because they are consuming Milo. We can also see parents giving Milo to their children in the
advertisement. The two parts of the ad are to attract children to consume and for parents to buy the product.
•Outdoor Media
Nestle Milo can be seen demonstrating their commitment to developing sport in India by sponsoring sports
events in the country. One such example is the Milo NIDJAM. In the events sponsored, Milo generally
opens a booth and gives away Milo drinks for free. This activity is very effective in instilling a strong
relationship between the primary consumer (children) and the product.
•Internet
Nestle has their own website (www.nestle.com) and more than 100 countries are registered under this
website. They even have an Indian website (www.nestle.in). They generally also have a different website
for each product they sell. They have a different website for Milo for other countries but not for India. In
order to get information about the product, Indians can visit the Milo section of the Nestle India website
•Printed Media
Printed media includes newspapers, magazines, posters etc. Nestle usually promotes the brand Milo in
children’s magazines because they are the target market and it also sponsors sports column in the some of
the widely read newspapers. The advertising normally includes famous sports public figures in order to
attract more sportsmen and sports loving children. Posters of Milo brand are distributed to the retailers and
wholesalers selling Milo which help people recognize the places that are selling the brand.
3.2 Social Media Promotion
Apart from promoting MILO by sponsoring various Indian teams and individuals in sporting events such
as the IAAF World Athletic Championships and the IPL, the brand also strongly endorses its motto of ‘A
cup full of Milo, A day full of energy’.
The company engages customers with stories and updates of Indian Athletes and their achievements
through their Facebook platform (https://www.facebook.com/NestleMILOIndia/) as a part of their efforts
to take a digital-first route towards promotions given the nature of audience they are targeting and the
growing relevance of social media. Their traditional TVCs have been tailored to several digital campaigns
that run on Facebook and YouTube Ads as well.
3.3 Promotion Recommendation
To make Milo a successful brand all over the country, the company needs to undertake unique and new
promotional activities which can differentiate them from competitors. For instance, Milo can widen their
promotions by conducting luck draws or other contests. They just need to put a lucky number behind the
packaging and the end of the month, they can draw a number, and the customer with that number can collect
their prize.

4. PRICE
The following are the price of various Milo variants in India

TYPE Weight Price in Rs. (M.R.P)

MILO Ready to Drink Tetra Pak 180 ml 35 (Rs 30 according to official site)
MILO Powder Pack 250 g 140
MILO Powder Pack 400 g 215
MILO Powder Tin 400g 230

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The price of MILO can be considered premium pricing in the health drinks and powders category since it
is priced higher than the competitors like Bournvita (500g @ Rs 204) and Horlicks (500g @ 204).
Although in the RTD category, Milo has slightly comparable prices to its competitors like Hershey’s (200
ml @ Rs 35), Cavin’s (180 ml @ 30). The comparable price in RTD category may be due to the rising
popularity of this category. The powder variant category in India is already highly concentrated and hence
does not offer a huge opportunity even if price is decreased. The pricing for ecommerce as well as brick
and mortar stores is similar although in some cases, discounts have been offered by the retailers or the
platform themselves.

Price strategy
The pricing of MILO in India seems to be in the premium segment with high quality and high price. The
high price is perhaps justified by the brand through the healthier ingredients in comparison to competitors.
The brand boasts of addition of unique ingredients such as Activ-Go which is enriched with minerals and
vitamins. Also, MILO offers lesser sugar content than the competitors thus projecting itself as a healthier
drink. The product has been positioned as a nourishing drink for growing kids with emphasis on sports. It
needs to be evaluated whether MILO is playing as a niche player in a mass market by positioning itself as
a kids’ sports drink which will justify the higher price also.

MARKET SEGMENTATION OF NESTLE’S MILO

Market segmentation is a tool used by companies to identify groups of buyers within a particular market
that have needs similar to one another and demonstrate similar purchasing behavior. Market segments for
Milo are described by the following parameters, ie. demographics, psychographics and geographical. These
segments were used by the company in order to draw up a customer profile ie. the image of a ‘typical
consumer’.

Demographics
The following demographical parameters were the most significant for segmenting the market for Milo:

 Age group: Milo primarily targets children but anyone above 6 years old can consume this product
 Income: Since this is available in different sizes (powder, RTD as well as cheap sachets in some
countries), people of different income of ranges, can buy this product.
 Sex: There is no differentiation, both Male and Female, can consume this product
 Life Cycle: people from all stages of life can consume this product (above 6 years old) i.e. children,
teenagers as well as adults.

Psychographics

 Education: People of all degree of education consume this product (because they know about the
product, its price, benefits etc.)
 Lifestyle: People living an ordinary lifestyle (because this product is not especially for the high
class, it is for everyone) Hence, all classes can consume this product

Geographical

After understanding the geographical differences in the needs and wants of the people in various parts of
the nation, and its market potential, Milo was launched in major cities i.e. Mumbai, Delhi, Bangalore,
Kolkata, Chennai and Ahmedabad because of their busy lifestyles.

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Advertising:

Milo Nestle advertises its products on Electronic Media like Television and the internet and non-electronic
Media like print media.

CONSUMER BEHAVIOR

In case of Milo’s buying process, the mothers play multiple roles in the buying decision. Mothers essentially
act as influencers, deciders, and buyers. Hence, Milo has developed campaigns to specifically target
mothers and develop a perception of a healthy and nutritious drink for kids imbibing goodness and positive
values.

MILO has a new campaign for promotions - MILO: GROW WITH SPORTS. It positions Milo as a
nourishment supplement for children to assist them to excel in sports. Milo is focusing on the truth that a
mother’s ardent desire is to see her child/children achieve his/her potential and succeed in life. Though a
mother tries to do everything to prepare the child for life ahead, she is also aware that success is achieved
not only through the knowledge from books. By indulging in sports, children will learn to persevere in
times of hardship, work together in teams, overcome fear through courage, find self-belief, be respectful of
others and develop leadership qualities.

By means of this campaign, MILO is endeavoring to make mothers believe that physical activity and sports
are important for personality development and help kids grow in a holistic way during their formative years
and hence to fulfill above requirements MILO should be their choice. MILO has applied a similar strategy
in other Asian countries like Malaysia and Sri Lanka.

They have also indulged in sports marketing as sports is their main core identity. They want consumers to
associate MILO with sports. To reinforce this identity, they have collaborated with and sponsored many
sporting events like:

1) Nestle Milo’s association as a title sponsor to NIDJAM (National Inter District Junior Athletics Meet)
(See Annexure B)
2) MILO has collaborated with the reigning IPL champions Chennai Super Kings by being the team’s
official sports energy partner for the season. To celebrate the passion that fans have for Chennai Super
Kings, Milo has also launched the campaign MILOvoduWHISTLEpodu to gain popularity. (See Annex B)
3) Sponsor of Athletic Federation of India (See Annexure B)

Purchasing Behavior

a. Where: This product can be bought at hypermarkets, supermarket, Pharmacies, Grocery Large shops and
even Bakeries (RTD)
b. When: consumers can consume and buy this product any time when they want.
c. How: consumer can just buy the powder and mix it with milk or water or simply purchase the RTD tetra
pack

TARGETING

Children always look out for the tastiest option, to make their daily dose of milk more enjoyable. Nestle
realized what children were missing out and decided to come up with the Brand MILO, “Taste with
Benefits”. They focused on this aspect of the product for their primary audience, children, while they

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highlighted the health benefits for their secondary target, the parents (especially mothers). Through their
new campaign, 'MILO – GROW WITH SPORTS', the company is building on a mother’s greatest wish,
which is to see her child succeed and fulfill his/her potential.

Hereby, the company focused the following MILO products on specific target customers –

1. Milo Strong: For kids (5-19 years old) and all the chocolate lovers - Today’s world is an
increasingly competitive place for children. They aren’t just expected to do better in studies, but
also do more elsewhere. Keeping this in mind, Nestle with its rich brand heritage, came up with
MILO Strong.
2. Milo Can - Ages above 12 - The cans are to be served for a niche set of audience initially and have
its own style statement. It hopes to stand out as the best product experience to be come in an easy-
to-store form and also appeal the youth of today relating it to a style statement.

The upper and upper-middle classes tend to the be the primary target segment for chocolate beverages, and
MILO is no exception. By focusing on these segments, brands like Milo are able to leverage the prestige
associated with their brand name, the health benefits and the parent company legacy to sell the product at
a premium price. The secondary target market for Milo is the lower middle class that is likely to shift to
more premium brands as disposable income rises.

POSITIONING

MILO Ready to Drink is a recently launched cocoa-malt milk refreshment made particularly for developing
kids and has lower sugar. The organization basically targets kids by giving taste and afterward targets
parents by concentrating on the wellbeing. In the recent campaigns released by Milo, the drink is positioned
as a must-have nourishing beverage for kids, to excel in the field of sports. While a mother gives a valiant
effort to set up the youngster for their life ahead, she realizes that achievement in life needs more than
abilities gained from books. Through sports, kids will figure out how to drive forward through hardship,
discover fearlessness over dread, fill in as a group, get self-conviction, be conscious and figure out how to
lead. Out of its current tetra pack the product is launched in a flat-bottomed Stabilo pouch case.

MILO SUBSTITUTES

Based on the positioning and targeting of Milo in India as a sports and energy drink, Parents might opt to
provide the same nutrition to their children (or sometimes themselves) through other ways:

1. Naturally flavored water – Children often like flavored water as it adds an interesting taste to the
boring, bland flavor of water. Moreover, parents might prefer this as an alternative since it adds
essential vitamins and nutrients to the children. Some combinations include adding pineapple,
watermelon, mint etc.

2. Coconut water – Coconut water is a common substitute to chocolate drinks for children. While it
does contain sugar, it also contains beneficial electrolytes which might be lost through sweat during
exercise.

3. Smoothies – Parents often use smoothies as a healthy alternative to chocolate drinks. It allows them
to give their child vegetables, fruits and other healthy items without hassle and can be especially
helpful for parents dealing with picky eaters.

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 4. Unsweetened Milk - Parents tend to prefer plain, unsweetened milk since it is one of the healthiest
choices for kids in terms of beverages. Plain milk provides kids with several nutrients and minerals
that contribute to their growth and development.

5. Caffeinated Beverages - Many young children drink caffeinated, including energy drinks and
coffee, which may have adverse effects on health. While these are generally not sanctioned by
parents as substitutes for chocolate beverages, they are often consumed by children.

6. Homemade drinks like juices, electrolyte drink like lemonade.

PEST ANALYSIS
The following PEST analysis will help us in understanding the external influences that may be affecting
the product (Milo) and its impact on consumer buying patterns. The purpose is to analyze the organization
(Nestle Milo) operations and to identify how it may be influencing marketing decisions.

Here are the advantages and disadvantages of using a PEST analysis:

Advantages
1. Outlines government law on businesses
2. Can be compared to previous PEST analysis. This helps in anticipating the possible changes in the
market
3. This is an indicator of growth of the firm
Disadvantages
1. It is prone to error
2. Expensive along with time consuming
3. Problems in the PEST analysis cannot be rectified as they are all external issues

PEST analysis on Milo:

Political
1. Adhering to the law (being aware of legislation health and safety, advertising standards, consumer
protection, trades description
2. Restriction on imports/exports

Economical
1. Impact of “Exchange rates” (if we buy from another country and the rates differs, it changes the
pricing of the product)
2. Taxes (directly impact the costs for consumers)
3. Recession (people have less disposable income – would they buy Milo?)
4. Inflation (prices go up for the company and for the consumer)

Social
1. Society is more aware of healthy lifestyle/rise in fitness industry
2. Focus shifting towards optimally utilizing the leisure time
3. More disposable income (can afford to buy luxury goods)
4. Fashion statement (could Milo be the next fashionable drink)

Technological
1. Advanced technology which helps in differentiating the product, its packaging or flavors
2. Advances in Sciences (add to Milo formula more energy/healthier)

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 3. Advances in Production Technology (more efficient + better quality/ less staff required = cheaper
for Nestle = cheaper for customers)
4. Improved media/communication internet/mobiles

COMPETITOR & INDUSTRY ANALYSIS

Milo, under the famous brand Nestle, is one of the leading chocolate malt beverages that is consumed all
over the world in different forms It can be served with water as well as milk, hot or cold. MILO is one of
the most favorite chocolate drinks of kids around the world.

Milo’s top competitors:

Bournvita Ovaltine UK Ovomaltine Cavin’s Milkshake Boost Hershey’s

Horlicks Viva Drinks TruMoo Abott PediaSure Sri Sri OjiSattva Amul Pro

If we consider the Indian Health Drinks industry, we can observe that there are two different categories in
which it is divided- white powders (Horlicks, Complan, etc.) and brown powders (Boost, Bournvita etc).
Horlicks had about 50% of market share in the year 2013 which made it the most prominent competitor,
even though it was a white powder. Milo faced intense competition by other drinks such as Bournvita,
Boost and Complan. (See Annexure C for Perception Map and Competitive Analysis).

Milo was discontinued when sales dropped despite heavy discounts and aggressive sales push. The
marketing system and supply chain used by Nestle was not so wide and the promotion strategies were not
that attractive. In India, Cadbury still remains a leader when we put market share into consideration. Milo
can easily find ways of increasing its market shares through expanding its market, agglomeration of brands,
focus on efficiency, improving the reach of their distribution systems and a robust logistics network. While
the premium model may seem counterintuitive, it is actually perfect for marketing Milo.

Milo should push itself more to make its mark as a premium product in the market. Smaller packaging must
also be considered in order to increase reach to the customers and volume of sales. The brand will then be
attractive and affordable especially to those having less disposable income but who are likely to experiment
due to their variety seeking nature like students, people who are newly employed, young people having
families as well as young families. By getting such customers well in time, Milo will become more likely
to cultivate brand loyalty early in a commoditized market.

Milo and Nesquik

While the information has not been confirmed or denied, sources say that Nestle India is
repositioning its health food drink brand, Milo in order to pave the way for the launch of
another one of its beverage brands from its global product portfolio known as Nesquik.
Nesquik is also a chocolate-flavored milk beverage that was launched in the United States
in the year 1948 and has been known worldwide since then.

The purpose of repositioning Milo in the Indian market is to target the ‘school going kids’
category, which can be a lucrative option to define and claim. This category would include
children studying in class 7 to class 11, rather than the broad-based ‘kids’ segment. This,
sources say, can be achieved by concentrating on the advantages Milo provides to children
participating in sports and resulting in a kid who is a champion in mind and body.

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 PRIMARY DATA COLLECTION
IMP. NOTE: The primary data collection was done in Feb/March 2020 before the COVID-19 Pandemic.
All the data was collected keeping in mind the safety norms applicable at that time.

1. INTERVIEWING PRIMARY SEGMENT-CHILDREN BETWEEN 7 & 12 YEARS

Respondent 1

Name of respondent - Kenisha Udayakumar

Age - 10 years old
Area of residence - Chennai, Tamil Nadu
Favorite malt beverage - Cavin’s milkshake
Has the respondent tried Milo? - Yes

Upon conversing with the respondent, it was revealed that she preferred competitor brand’s (Cavin’s)
chocolate flavor better than Milo. She also mentions that she enjoys drinking Milo and has rated it as her
second favorite chocolate beverage.

Analysis: Cavin’s milkshake from CavinKare is a Chennai-based brand that has existed in the market for
30 years. In contrast, Milo was relaunched in the Indian market in the year 2019. This may be playing a
role in the respondent’s preference of Cavin’s over Milo since she has not been exposed to the product for
a longer period. Cavin’s milkshakes also come in a variety of flavors, thus giving more selection choice to
children in the target age group. Milo, on the other hand, is available only in chocolate flavor, which could
be contributing to the respondent’s preference as well.

Respondent 2

Name of respondent - Mehak

Age – 8 years old
Area of residence - Ghaziabad, Uttar Pradesh
Favorite malt beverage - Bournvita
Has the respondent tried Milo? – No

The respondent revealed that she likes the competitor brand (Bournvita) and has not tried any other brand.
She was not aware of either MILO or the parent company Nestle. She revealed that that she liked the
chocolate taste in the beverage she drank but not the sugar. She also revealed that she drinks whatever her
parents buy for her and does not have her own preferences for the chocolate drinks or food products in
general. The respondent played various sports but did not drink chocolate beverages as something that
provided her strength for playing sports. Rather she preferred drinking plain water or lemonade. She was
aware of campaigns for health drinks and could recall brands like Bournvita and Horlicks.

Analysis: The brand preferred by the respondent is the most popular one in the market. Since, MILO has
been recently launched and does not have many advertisements on television, the respondent is not aware
of it. Also, it can be observed that parents, especially mothers can decide the food and the beverages that
their children are consuming. Also, though MILO’s identity is related to sports, the respondent who plays
sports, was not aware of the brand.

Respondent 3

Name of respondent - Chitwani

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Age – 7 years old
Area of residence - Ghaziabad, Uttar Pradesh
Favorite malt beverage - Bournvita
Has the respondent tried Milo? – No

In the conversation with the respondent, she revealed that her preference was the competitor brand
(Bournvita). She likes it for the chocolate taste and not for the sugar. She revealed that sometimes her
parents insist on her drinking the milk beverage as she is not very fond of milk. The respondent revealed
that she tells her parents to buy certain products and brands for her, but they are not necessarily food
products. She plays various sports but prefers plain water as refreshment.

Analysis: The brand preferred by the respondent is the most popular one in the market. Since, MILO has
been recently launched and does not have many advertisements on television, the respondent is not aware
of it. Also, it can be observed that parents, especially mothers can decide the food and the beverages that
their children are consuming though in certain cases although in certain cases children also act as deciders.
Also, though MILO’s identity is related to sports, the respondent who plays sports, was not aware of the
brand.

2. RETAIL STORES AND RETAILERS OBSERVATIONS AND INTERVIEW

ORGANISED RETAIL

A) RELIANCE SMART

LOCATION: Reliance Smart store in Chander Nagar, Ghaziabad. Launched in May 2019, it is a new store.

TYPE: SUPERMARKET
Reliance Smart caters to the consumers as a one-stop shopping experience. It offers fresh produce, dairy,
bakery, home, beauty and wellness products and general merchandise.
SKUs
1. RTD Tetra Pak (180 ml @ Rs. 35) 2. Powder Packet (400g @ Rs. 215)
BRANDS AVAILABLE/ MOST POPULAR BRANDS
All major brands were available, and some newer brands were also available in the supermarket. Total
number of brands available in this category can be approximated to around 10-15. The most popular brands
are Horlicks and Bournvita. Most popular quantities were 500 to 725 gm packets.
DISPLAY (See Annexure D.1) AND VISUAL DECORATIONS
For health drinks and powders, a single aisle was present. Major brands such as Bournvita, Complan,
Horlicks, Boost etc. were displayed. There was no separate isle for kids focused health drinks as such. Some
large quantity SKUs were displayed in middle of walkways. Some saving offers were written over them on
placards. (See Annexure D.2). Interestingly, MILO was not there on this isle but was displayed separately.
Also, there were very less packets displayed. (See Annexure D.3). At the time of the visit there were no
placards or offers or decoration for the health drinks.
Inputs from Mr. B- Team Lead for marketing division, Reliance Smart Chander Nagar store:
PAID PRODUCT PROMOTION/ OTHER PROMOTION
MILO was not placed with other brands in the same category because it was having paid promotion and
that is why it was placed in a separate stand. Once the promotion ends it will be placed again with other
products with similar category. Paid promotion was employed by other brands also as and when required.
Promotions were usually done through hangings, promoters, samplings etc.

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SHELFING
The shelfing plan and which product to keep where is done through PLANOGRAM-a diagram which
displays how and where a particular retail product should be placed on a retail shelf/display so as to increase
customer purchases. The Planogramming technique is used in merchandising and retail space planning. Mr.
B told that PLANOGRMS were provided to them by the head office itself and they just put products
accordingly. (See Annexure D.4)
INVENTORY REPLINISHMENT/PROCUREMENT
Inventory is checked in real time. If certain product seems less, they bring in them through the warehouse.
Reliance has their own procurement centers and warehouses from where the things come in. So, there are
no intermediaries.
Insights received Ms. Pankaj who is the store manager in charge:
SKUs
They sell the powder as well as the RTD. The RTD is kind of popular because of lesser price. Still, when
compared to other brands MILO is not as popular in both the powder as well as RTD variant. She also told
Hershey’s and Cavin’s chocolate drink is popular. Horlicks and Bournvita are the highest selling.
INVENTORY
All the inventory replenishment happens in real time. They are using SAP software for that. They have
certain MBQ (Minimum Base Quantity). MBQ is the minimum level of stock the retailer plans to keep in
a store. MBQ may be according to the demand). In real time, as soon as the quantity reaches MBQ, they
order the product. Daily checks happen. They also have safety stock too.
HOW THEY SELECT OR REJECT PARTICULAR PRODUCTS FOR SELLING?
Store concentrates on volume of sales rather than margin. Also, they assess the products on their region-
specific popularity. So, retail chains at different locations may have different products in different
quantities. Since this particular retail store was opened last year itself, they were still evaluating buyer
patterns. They stock mostly all brands, but some really specific variants may not be there.
PROMOTIONS
The company has tie ups with promotors of brands. They have licenses and FSSAI (Food Safety and
Standards Authority of India) approved. Promotional activities include paid visibility, sampling of food
products, end cap, flow stand display etc. HUL has the maximum number of promoters. Nestle has lesser
promoters as it has highly popular products like Maggi which get sold anyway. MILO’s promoter comes
in weekend and sometimes performs sampling activities.
DISCOUNTS/ PRICE CHANGES
They do not Mark Down the price of health-related consumption products even when they are near expiry
as it is related to someone’s health and their firm does not promote such kind of initiatives.
RECOMMENDING CUSTOMERS AND INCENTIVES FOR SALESPERSONS
They do recommend the customers products. This is most popular in cosmetics and beauty category. The
salespersons are motivated to reach targets as they are given incentives for the same.
STORE MANAGER’S SENTIMENT TOWARDS MILO
“Although I am not aware about the market penetration of MILO, I do not think it is very popular. We also
have less prescribed MBQ for MILO. I feel that people who mostly buy in this category, buy products by
being influenced by advertisements. Kids are also becoming smart and choosing products for themselves.
Since I have not seen MILO’s campaigns or ads in T.V. etc., I feel consumers are not very consciously
aware about it.

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B) SHIV GANGA SUPER MARKET 3D PVT. LTD.
LOCATION: Uttam Nagar,New Delhi
SKUs
1. RTD Tetra Pack (180 ml @ Rs. 35) 2. Powder (250 g @ Rs. 140)
3. Powder (400 g @ Rs. 215) 4. They also keep the Can Variant which is presently out of stock.
DISPLAY
When the product was launched, the company did a special paid display. They had set up a different aisle
and special display for Milo products for three months (see Annexure E.1). During this period, the sales
executive from the company would visit on a weekly basis to ensure that the display was on point. This
helped the sales of this product pick up as customers had no prior knowledge of this product.
However, after the initial launch period, the display changed a lot. From a single, it went and was bundled
up with other brands with no special display. The manager said that the company does not give any incentive
for shelf positioning and hence they randomly place the product with others of the similar product category.
(See Annexure E.2). Major competitor Brands Horlicks and Bournvita both have paid eye level displays
(the company executives visit on a weekly basis to ensure product placement) (See Annexure E.3).
SALES
The can sells the most followed by the 400g powder pack. The sales volume of Milo is lesser as compared
to other brands like Horlicks, Bournvita and Boost as these are brands that the locals have known from a
very long time. In this store, the product is mostly purchased by the Nigerian nationals living in the locality
as Milo is quite an established brand in their home country.

Conversation with Nestle Sales Executive

After our research at the Shiv Ganga Super Market, we got the contact of Nestle’s POC for that region, Mr
Sintu Kumar Sinha. He was very reluctant to share information about the brand. However, upon discussion,
these are the things he was able to shed light upon:

Types of retailers Milo is supplied to:

1. Supermarket 2.Pharmacies 3.Grocery Stores 4. Large Bakeries

Grocery Small: They don’t source Milo to Grocery Small type retailers. These retailers find it difficult to
sell Bournvita or Horlicks powder in their stores (which the locals are well aware of) and barely keep these
packets. Hence the company decided that sourcing to these retailers will not generate any sales at all.
Another thing to note here is that, sourcing to these retailers will lead to product expiry even before the
stock runs out. This eventually generates greater losses.
VARIANT WISE
Can and Powder: these variants are mostly supplied to Supermarkets, Pharmacies. RTDs: The tetra packs
are most popular in Supermarkets, Grocery Large stores and Bakeries (where RTDs of other brands are also
available)

C) D-MART SUPERSTORE
LOCATION: Vadodara, Gujarat. (See Annexure F for Displays)
SKU
1. Powder (400g): Rs. 215 (MRP)
Discount offered by Nestle was Rs. 35 and that by D-Mart was Rs. 10. Total discount was Rs. 45.
D-mart Price for 400g Milo: Rs. 170* (*This offer was limited only for the month of March.)
Discussion with Ms. Meenal who takes care of Nestle products in that D-Mart store:

Q. How people perceive Milo and what would be the shelf life of this product?

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A. People generally perceive Milo as a sports drink and since it is not very famous hence the sales are less
as compared to other brands. Boost is the major competitor for sports drink which people prefer. Hardly 5-
6 packets of Milo get sold in a month.
Q. What are the competition sales as compared to Milo?
A. The highest selling is Bourn Vita and then Horlicks. Nearly 300-400 packets of Bourn Vita are sold in
a month whereas 10-15 of Milo. People prefer Bourn Vita more and are always looking for the same.
Q. What is the inventory at the store?
A. As the sales is not much, there is 1 carton kept as inventory apart from the 6 packets displayed on shelf.
Following are some of the points observed during visit and discussion:
- A lot of SKUs of Milo’s competitors were present but only one SKU of Milo was present.
- Despite the hefty discount that was present on Milo during that time, sales were not that prominent as
compared to competition brands.
- Most people were unaware about Milo and are looking for popular brands like Bournvita, Horlicks etc.
- Only 2 visible face packets of Milo were present compared to heavy visibility of competition brands.

UNORGANISED RETAIL

1) OM GENERAL STORE

LOCATION: Surya Nagar, Ghaziabad. A Kirana shop which caters to around 2-3 residential blocks.
TYPE: GENRAL STORE/ KIRANA STORE
It is a family owned shop popular with all economic classes living in the nearby locality.
SKU
1. Tin with powder (400g @ Rs. 230) 2. Powder Packet (400g @ Rs. 215)
The store has around 20 SKUs in total of milo with 2 Tin packs.
BRANDS AVAILABLE/MOST POPULAR BRANDS
Major Brands were available. Approximately 4-5 Brands were available in this category. The most popular
brands are Bournvita and Horlicks. 75 g pack at Rs 30 and 500 g pack is most popular. MILO is not popular,
and its SKUs have not been sold in the last two months.
DISPLAY/SHELFING & DECORATIONS/ PROMOTION
Since it was a small shop having space constraints, there was no display plan or shelfing. No decorations
were seen at the store for this product category. Promotion is done mostly posters and standees.
INVENTORY REPLENISHMENT/ PROCUREMENT
Checks for replenishment are done weekly and products are ordered with estimation of weekly demand.
Demands can fluctuate so orders are adjusted accordingly. Milo was procured through Nestle’s distributor.
The distributer comes in weekly and the payment to him is done through cash.
INCENTIVES & DISCOUNTS
Provided for extra sales (around 2% of the total sales). These can vary depending upon the product as there
can be thresholds also. Almost 90% of the FMCG brands which he sells give these kinds of incentives.
For MILO, the owner did not offer any discounts. He said - “MILO’s representatives have the policy that
in case the product does not get sold and exceeds its expiry date, I can return the SKUs and get my money
back. I can get it replaced too. So, it does not make sense for me to offer the product at discounted price
since I have the provision of returning it once the expiry date is exceeded.”
RECOMMENDING CUSTOMERS
He observed that now a days the customers are themselves very aware of what they want to purchase and
are also decisive. Hence, they do not usually need recommendations.
HOW SELECTION/REJECTION OF PRODUCTS FOR SELLING IS DONE?

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For him the sale of a product is important. When a product does not get enough sales, he does not order it
for the next time. He said- “I have a small shop with constraints of space. If a product does not get sold fast,
it not only hampers my returns, but it also occupies space which I could have utilized for stocking a more
popular product”.
How has large retail stores/ supermarkets/e-commerce affected the Kirana store business?
The shopkeeper felt that the larger retail stores, supermarkets, e-commerce stores have impacted his
business adversely. He felt that white collar job employees get discounts and coupons for buying in certain
stores and do not prefer the Kirana stores now. He also felt that he provided cash as the only payment
method and by not using digital payment methods like Paytm etc. he was losing out on some of the sales.
Some firms have helped. For example, HUL has provided them with a billing machine where in any
discounts on billing which customers might get in supermarkets/malls, they can get at their store too. The
owner feels that these kinds of steps by the companies can help his business in some way. He observed-
“The online platforms first adversely affected the business. At the same time, he felt that online stores do
not have the same trust factor which his store provides. He said- “Some of my customers have faced quality
issues while buying online but they never face that issue with me. Here at my store, they can see what they
are buying and if they have any concerns, they can always come and meet me face-to-face.
Can small stores and big supermarkets/ online platforms co-exist in future?
The owner was optimistic that his business can survive even with the advent of big stores and online
platforms. He profoundly commented- “Today we have airplanes and big aircrafts for travel. At the same
time, you can see the humble bicycle and bullock cart on the roads. If these starkly different modes can co-
exist, then my small shop can too”

RECOMMENDATIONS
After analyzing the secondary and primary research, the following recommendations are made for MILO:

1. Since MILO India has repositioned itself to target school-going children, they should cater to the
variety-seeking nature of these consumers. Taking a page from MILO's operations in other
countries, MILO India should also launch other flavors of MILO for better reception.
2. Affordability is a hindrance that MILO faces when it comes to expanding its reach to smaller cities.
Hence MILO should launch affordable SKUs that can be sold at local Kirana and Grocery small
shops.
3. There seems to be a lack of awareness about the product among consumers despite MILO’s
campaigns and collaborations. Hence, more advertising and campaigns need to be formulated. TVC
can be a good platform to influence the target market of mothers and kids.

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ANNEXURES

A. PACKAGING

MILO Tin (400g) MILO RTD (180ml)

MILO 20g sachet MILO 400g Activ-Go

B. ADVERTISING

NIDJAM Sponsor

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Milo Grow with Sports Campaign

#MiloVoduWhistlePodu Campaign

Athletic Federation of India

C. COMPETITOR ANALYSIS

C.1 Perception Map – Milo tastes good, but lacks in variants, making it boring

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C.2 Comparative Analysis of Milo against competitors prior to re-launch

D. PRIMARY DATA – RELIANCE SMART

D.1 Major Brand Displays

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D.2 Competitor Offers

D.3 MILO Display

D.4 PLANOGRAM

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 E. PRIMARY DATA – SHIV GANGA SUPER MARKET 3D. PVT LTD.

E.1 Display during launch phase

E.2 Placement post launch phase

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E.3 Eye Level Display by Competitors

F. PRIMARY DATA - DMART STORE

F.1 In-store displays of chocolate beverages

F.2 Available MILO variant

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 REFERENCES

https://www.nestle.in/media/pressreleases/milo-launches-new-ad-campaign

https://www2.spikes.asia/winners/2013/pr/entry.cfm?entryid=4045&award=101&order=0&direction=1

https://www.marketing-interactive.com/nestle-milos-latest-campaign-brings-mothers-back-to-school

https://www.exchange4media.com/ipl-news/milo-partners-with-chennai-super-kings-as-official-sports-
energy-partner-96295.html

https://www.insidesport.co/iaaf-world-championship-india-unveils-kit-with-new-sponsor/

https://www.exchange4media.com/marketing-news/nestle8217-s-milo-in-makeover-mood-11048.html

https://www.healthline.com/nutrition/tips-for-picky-eaters

https://www.business-standard.com/article/companies/with-milo-s-relaunch-nestle-builds-a-millennial-
track-around-its-brands-119090401520_1.html

https://www.amazon.in/

https://www.netmeds.com/

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