Maggi

The Product Life

Cycle

Submitted By-
VIT b- school
Vellore
 Introduction of Maggi 2-
minutes Noodles
v It’s a Brand of instant Noodle v Nestle wanted to explore
made by Nestle India Ltd.
v It was found by the Maggi
family in Switzerland in the
19th century.
v Nestle launched Maggifor
the first time in India in the
year 1982.
v The Brand is popular in:
- Australia
- India
- Malaysia
the potential for such an
Instant food among the
Indian market.
v It took several years and
lot of money for Nestle to
establish its Noodles brand
in India.
v Now it enjoys around 90%
market share in this
segment.
v Over the years Maggi has

- New Zealand
 ISSUES
• Different phases product life cycle of
maggi
• Why atta noodle was a failure?
• Strategies taken to establish new
product category
• What measures NIL should take to
sustain the image of a popular brand
image.
• Stage at which maggi is in the
product life cycle.
 PRODUCT LIFE CYCLE

A concept that provides a way to trace the

stages of a product’s acceptance, from its
introduction (birth) to its decline (death).
 GRAPHICAL REPRESENTATION
OF A TYPICAL LIFE CYCLE
Introductory Growth Maturity Decline
Stage Stage Stage Stage Product
Category
Sales
Dollars

Product
Category
Profits
0

Time
 Introductory Stage
• High failure rates Full-Scale Launch
• No competition of New Products
• Frequent product modification
• Limited distribution
• High marketing and production costs
• Promotion focuses on awareness and information
• Nestlé India Ltd. (NIL), the Indian subsidiary of the global
FMCG major, Nestlé SA, introduced the Maggi brand in India
in 1982, with its launch of Maggi 2 Minute Noodles, an instant
noodles product
• With the launch of Maggi noodles, NIL created an entirely new
food category - instant noodles - in the Indian packaged food
market. Because of its first-mover advantage, NIL
successfully managed to retain its leadership in the instant
noodles category
STPD Analysis
 Market Penetration
ü Promotional campaigns in
school.

ü Advertising strategies: -
focusing on kids.

ü New product innovation

according to the need of
consumers:
– Veg. Atta
Noodles.
ü – DalAtta Noodles.

ü – Cuppa Mania.

ü Availability in different
packages:
– 50 gms.

ü – 100 gms.
 Growth Stage
• Increasing rate of sales
Offered in
• Entrance of competitors
more
• Initial healthy profits sizes,
• Promotion emphasizes brand ads flavors,
• Prices normally fall options
• Development costs are recovered
• 10 yrs back it enjoyed around 50% market share in this segment which
was valued at around 250 crores.  
• During the 1990s, the sales of Maggi noodles declined, due to growing
popularity of Top Ramen , another instant noodles product.
• In order to improve sales , NIL changed the formulation of Maggi
noodles in 1997.
• However, this proved to be a mistake, as consumers did not like the
taste of the new noodles.
• In March 1999, NIL reintroduced the old formulation of the noodles,
after which the sales revived. Over the years, NIL also introduced
several other products like soups and cooking aids under the Maggi
 Maturity Stage
• Declining sales growth
• Saturated markets
• Extending product line
Many consumer
• Stylistic product changes
•
products are in
Heavy promotions to dealers and consumers
• Prices and profits fall
Maturity Stage

• In 2003 Hindustan Lever Ltd was all set to take on Nestle's

bestselling Maggi 2-minute noodles by launching a new category
of liquid snacks under its food brand, Knorr Annapurna.
• The new product, called Knorr Annapurna Soupy Snax, was priced
aggressively at Rs 5 and had four variants: two chicken options
and two vegetarian.
• Like Maggi, Soupy Snax will be an in-between-meals snack and
will be targeted at all age groups, particularly office-goers.
 STPD Analysis
Segmentation to
Differentiation:
■ Classic Noodles –

5 – 10 yrs.
■ Veg. Atta Noodles –
Health Conscious.
■ Rice Mania –
Teenage
■ Cuppa Mania –
Office goers,
 Decline Stage If no product
innovation brought
• Long-run drop in sales
• Large inventories of
unsold items
• Elimination of all nonessential
marketing expenses

Rate of decline depends on

change in tastes or
adoption of substitute products
 Extending the PLC

• Change product

• Change product use

• Change product image

• Change product positioning

 CATEGORIES OF NEW
PRODUCT/REVISING THE
New-To-The-World

New Product Lines

Six
Categories Product Line Additions
of
New Improvements/Revision
s
Products
Repositioned Products

Lower-Priced Products
 Analysis(why Atta Noodles
•
Failed?)
In 2005 Nestlé India
launched MAGGI
Vegetable Atta Noodles.
• Based on consumer
needs and evolving
trends for more whole
grain based products.
• Extensive Research
and Development
expertise to develop
Maggi Vegetable Atta
Noodles.
• Maggi Vegetable Atta
Noodles will provide the
dietary fibre of whole
The health angle…
Comparing the prices…
 FAILURE CAUSES
1. Indian psyche-
The basic problem the brand faced
is the Indian Psyche. Indian Palate is
not too adventurous in terms of
trying new tastes. So a new product
with a new taste that too from a
different culture will have difficulty in
appealing to Indian market.
2. Price-
The price of atta noodle was little more
than maggi 2 minutes noodle
3. False claims-
In October 2008, Nestle mistakenly aired
an advert that noodle "help to build
strong muscles and bone". The
British Advertising Standards Authority
said that it was a false claim.
4. Not purely vegetarian-
Maggi Noodles also contains the
additives E150d and E627.E627 is partly
prepared from fish,and is thus not
suitable for vegetarians. E150d is
5. Lack of essential
nutrients-
The new maggi atta
noodles as can be
seen from the fig.
lacked essential
vitamins A, C,also the
fat content was more
then carbohydrates
6. Targeted health
conscious people……
……but attanoodle
didn’t appealed
them……because of
 Suggestive Promotional
1. They should Strategies
conduct test marketing before
launching new product.
2. Focus on creating distinctive image, based on
twin benefits of “INSTANT” and “HEALTHY”.

3. Conduct promotional campaigns at schools in

small towns with population more than
10,000.
4. Strengthen the distribution channel of the
rural areas within 100 KM of all the metros.
5. Launch new advertisement campaign (T.V.,
Radio and print media commercials) with the
brand ambassador.
Current Scenario of Maggi
Leading Brand in
India as well as
World.
Current Sales:
Approx.
– 90000 boxes

– Rs. 4,79,49,000 in
Mumbai
– 10,00,000
boxes
– 55 cr. in India
Reasonable
competitive pricing.
Creative interaction
blogs for customers:
–
Thank you