FUMDAMENTALS OF MARKETING
(ASSIGNMENT)
ENVIRONMENTAL FORCES ANALYSIS
Company 1 – Nestlé India
MICROENVIRONMENT
The Company -Nestlé’s top-
level management have always
supported the middle level
managers and senior executives
to increase product localization
and innovation, marketing
promotion, quality control etc.
Suppliers – They have a very
strong relationship with their
suppliers in terms of
engagement, especially those in
agriculture. It has adopted a
localized distribution method
and has a diversified
distribution system in both
Urban and rural areas. Nestle
has strong relationships with
suppliers, retailers, vendors, and
distributors.
MACROENVIRONMENT
Demographic – Regardless of the
income, the consumers of Tea and
Coffee has always been high and
the consumption seems to be
gradually growing.
54% of population below the age
of 24 years means Chocolate and
Maggi has been the highest
contributors. It is planning to
extend its range in the chocolate
market and Maggi to target the
youth.
Political – Since the banning of
Maggi in 2015 over over
allegations that it contained lead
beyond permissible limits, it has to
comply with changes in regulation
regarding food standards and
marketing action.
Since last year Nestle has enjoyed
relaxation in corporate tax rate by
the Indian Government.
Marketing Intermediaries –
Nestle has tied up with Paytm
(limited time period) for
cashback offers in order to
target the core consumers.
It also has a well-established
relationships with other trusted
and huge brands like Colgate,
Coca Cola, and L’Oréal.
Competitors - Many companies
like Mondelez and Unilever are
some top competitor for Nestle
and offer similar food and
beverage products along with
strong product portfolio. It is
hard for Nestle to compete in
such a situation where the
substitute products are easily
accessible.
Public – Along with the well-
established relationship with
other popular brands, it is a
globally recognized company
and a highly diversified
Economy – Despite of Slowdown
and inflation in the past few
months, nestle has managed to
perform better than its peers.
It’s mainly because the company
chose against making large
changes in pricing despite the rise
in other commodities. They kept
in mind about the Indian
consumers being price conscious.
It also produces its product at local
level to boost economic growth of
farmers.
Socio-Cultural – Number 1 in
underweight population, India is
now among the top 5 in Obesity.
Looking at this the consumption
pattern, diet habit and preference
of people have changed. So, nestle
has started producing healthier
product and is committed to
reduce sugar, sodium and
saturated fats and trans-fats
content in its products.
Oil and fats in its product now will
be trans-fat.
Technological – Nestle has the
largest R&D network of any food
company in the world.
It had a tie-up with Snapdeal
during its comeback with maggi.
company, selling its product inE-commerce in food retailing has
189 countries. not been as effective as other
Also, according to Forbes, it categories but it is still growing
was the world’s most valuable and contributes about 1.5% of
company in 2018. revenue.
Advance technologies can
improve product quality and
change marketing strategies.
Customers – Immediate Natural –Its production is highly
customers of Nestle are retail dependent on water usage but
and grocery stores. Nestle has sustainable efforts and
High demand in individuals and innovative initiatives to reduce
households for personal water wastage, reduce waste, use
consumption. of renewable energy etc. In 2017,
Grocery sales are majorly 253 of nestle factories reached
achieved through huge retail zero waste production.
giants, Walmart, Reliance etc.