In recent years, the food and beverage industry in Vietnam has always had a

high growth rate and is considered one of the most attractive industries. The market
is increasingly competing with many big names. Nestlé Vietnam Ltd. has many
years of development and is a leading company in food and beverage in
Vietnam. To continue developing stronger and more sustainable in the coming
time, Nestlé Vietnam Ltd. needs to develop a development strategy, especially a
marketing strategy.
Nestlé Vietnam Ltd. was established in 1995, is a 100% foreign-invested
company, belonging to Nestlé SA Group - is the largest food and beverage group in
the world currently present in 191 countries with 328,000 employees. worldwide,
based in Vevey - Switzerland. Nestlé is committed to improving the quality of life
and contributing to a healthier future for consumers around the world. With a
commitment to make long-term investments in Vietnam, in recent years, Nestlé
Vietnam Ltd. has continuously invested in building, expanding production lines at
factories and diversifying products to meet the needs of food, nutrition and healthy
living for Vietnamese consumers.
Currently, Nestlé Vietnam Ltd. operates four factories producing food and
beverage products. All Nestlé factories in Vietnam are designed and built to meet
the highest standards of unified quality throughout the Group, while always
complying with Vietnam's laws on environmental protection, pollution prevention
and application of initiatives to reduce emissions into the environment, save water,
aiming to Zero on waste to the environment in production (Path to Zero).
With a total investment capital of more than US $ 520 million, Nestlé
Vietnam Ltd. has become one of the leading successful foreign-invested companies
in Vietnam, with remarkable contributions. for the social and economic
development of the country. Nestlé Vietnam Ltd. always maintains double-digit
growth, receives certificates of merit for contributing to the State budget, active in
the field of sustainable agricultural development, environmental protection and
nutrition education, physical, healthy and happy life in Vietnam. (About Nestle
Vietnam Ltd, [online] Available at: http://vnr500.com.vn/Thong-tin-doanh-
nghiep/CONG-TY-TNHH-NESTLE-VIET-NAM-Chart--271-2015.html)
 Figure 1: Nestle’s company Figure 2: Some product
branding recognition brands of Nestle Vietnam Ltd
According to Euromonitor’s report, the instant coffee market share of Viet
Nam in 2014 and the finacial indicators of top 6 key diary players in 2016 are
shown below.

Figure 3: Instant coffee market share in 2014, Source: Niesel Vietnam

Figure 4: The finacial indicators of top 6 key diary players in 2016

 (Vietnam dairy market 2018, [online] Available at:
https://www.slideshare.net/StoxPlusCorporation/vietnam-dairy-market-2018)

To analyze current status of the company, we use SWOT analysis. SWOT

analysis (or SWOT matrix) is a strategic planning technique used to help a person
or organization identify strengths, weaknesses, opportunities, and threats related to
business competition or project planning. It is intended to specify the objectives of
the business venture or project and identify the internal and external factors that are
favorable and unfavorable to achieving those objectives. Users of a SWOT analysis
often ask and answer questions to generate meaningful information for each
category to make the tool useful and identify their competitive advantage. SWOT
has been described as the tried-and-true tool of strategic analysis, but has also been
criticized for its limitations(Wikipedia, 2018).
Strengths and weakness are frequently internally-related, while
opportunities and threats commonly focus on the external environment. The name
is an acronym for the four parameters the technique examines:
Strengths: characteristics of the business or project that give it an advantage
over others.
Weaknesses: characteristics of the business that place the business or project
at a disadvantage relative to others.
Opportunities: elements in the environment that the business or project
could exploit to its advantage.
Threats: elements in the environment that could cause trouble for the
business or project.
The degree to which the company's internal environment matches the
external environment is represented by strategic fit. Identifying SWOTs is critical
because they can advise later planning steps to achieve the goal. First, decision-
makers should determine whether the SWOT target is achievable. If the goal is not
attainable, they must choose another goal and repeat the process.
Applying this model in to the case study of Nestle Vietnam Ltd, the
analysis below will point out more detail.
 Figure 5: SWOT analysis of Nestle Vietnam Ltd

Strengths of Nestle Vietnam Ltd (STRENGTHS)

1. Famous brand - Nestle is the most famous brand in the world. It has
developed a respectable reputation in the field of food and beverage providing high
quality products for daily use around the globe.
2. Globally Recognized Brand - Through effective branding and
advertising strategies, it has created significant awareness and successfully
developed brand image around the world. According to Fortune Global
500, Nestle are among the largest corporations in the world and is ranked
in position 69 in the list in 2018.
3. Highly diversified company - Nestle sells its products in 189
countries. Instead of relying on a few markets, the company has captured a large
market in many developed and developing countries to make the most of its
revenue. Its top markets include the US, China, France and Brazil. In 2017, it
generated CHF 26.7 billion from the US market alone.
4. The most valuable brand in the world - According to Forbes Global
2018 , Nestle is one of the world's most valuable companies in terms of revenue,
profit, assets and the highest market value.
5. Extensive product portfolio - Nestle owns more than 2000
brands globally and innovates more than 8000 products to consider nutrition and
health, according to 2017 annual reviews . It is one of the largest companies in the
world with the widest product portfolio.
6. Strong relationship and famous brands - Nestle has some of the most
recognized brands in the world under its names such as Nescafe , Kit
Kat , Gerber , Milo and Maggi . Besides, it has strong relationships with other
reliable and strong brands such as Colgate Palmolive, Coca Cola , General Mills
and L'Oréal.
7. Effective R&D system - Nestle has the world's largest food and
nutrition research organization with 21 R&D centers. Research and development is
one of its main competitive advantages. More than 5000 employees are involved in
R&D activities. It spent nearly 1.72 billion Swiss Francs on R&D in 2017.
8. Environmental sustainability practices - Nestle makes significant
efforts in environmental sustainability practices and implements innovative
initiatives to improve product quality. It optimizes advanced solutions to reduce
waste, use water, use non-renewable energy and use packaging materials. In
2017, 253 of the Nestle factory reached zero waste. To convey sustainable benefits
to customers and keep the environment clean, Nestle has launched a free mobile
application that helps people recycle packaging waste correctly.
9. Large distribution network - Nestle owns a large and diversified
distribution system, not only penetrating into urban areas but also rural areas. It has
adapted local delivery methods and decentralized approaches to run businesses
effectively in their respective countries. Nestle has close relationships with
suppliers, retailers, suppliers and distributors.
Weaknesses of Nestle Vietnam Ltd (WEAKNESSES)
Price fluctuations of retail giants - Nestlé's grocery sales are achieved
mainly through giant retail giants such as Walmart , Tesco and Kroger . Any
decrease or increase in prices of these retailers may affect Nestlé sales.
1. About controlling and structural organization - A large number of
brands belonging to the same group of cells, which makes it difficult to manage
Governance large, a large number of brand individual can often lead to discord and
conflict of interest.
 2. Water controversy - Recently , Nestle was accused of illegally
pumping millions of liters of water in 6 countries where residents were short of
drinking water.
3. Social criticism has become the target of media attention many
times. Requiring privatization of water, misleading labeling and a lawsuit on
chocolate production using child and slave labor are some examples that undermine
its market reputation.
4. Maggi noodles controversy - In 2017, Nestle failed to delete a lab test
in India. This created a public hype when people boycotted Nestle, resulting in
an 80% loss of domestic market share. Nestle declares ' No more MSG' in Noodles
packages. However, 1,000 times lead was found in the product after testing.
Opportunity of Nestle Vietnam Ltd
1. Venture into a small food startup - Nestle has a great opportunity to
grow the number of small food startups under its popular brand. Nestle can also
partner with startups to promote their brands.
2. Online shopping - Nestle has a remarkable opportunity to promote its
e-commerce websites and online shopping platforms. Very few CPGs are providing
online services to make the shopping experience more comfortable and
pleasant. Although Nestle has online stores in a number of countries, expanding its
online services into more areas will prove a rewarding decision for the company.
3. Market penetration for breakfast cereal - Nestlé 's cereal and oat
market has shown rapid growth in recent years. Therefore, more market
penetration will bring high profits to the company.
4. Expanding the market for ready- made tea and coffee - The demand
for tea and coffee is constantly increasing, creating a lucrative opportunity for
Nestle to market this market more.
5. Partnership - Strategic alliances with other food and beverage giants
are also a great opportunity for the company to increase sales and profits.
6. Authentic labeling - Nestle has been criticized for providing false
nutritional information on its label. Therefore, there is an opportunity to improve its
practices by providing reliable information and accurate labeling for its products.
Nestle Vietnam Ltd. Threat (THREATS)
 Controversy over illegal destruction of tropical forests - In 2017, Nestle
was accused of being involved in the destruction of the last Sumatra rainforest. It
faces heavy criticism from NGOs and environmentalists on this issue.
1. Water scarcity - Nestlé production is highly dependent on water
use. Access to clean water through less expensive sources has become difficult for
the company for many reasons. These include population growth, climate change,
increased demand for food and water, increased pollution, water waste and
overexploitation of resources.
2. Increased competition - Many CPG companies such
as Mondelez and Unilever offer similar food and beverage products. It is difficult
for Nestle to compete in such a situation that alternative products are easily
accessible.
3. Government regulations and prices - Government regulations can
affect Nestle's business. In addition, increasing commodity prices forced the
company to increase product prices. It will lead to a reduction in sales as consumers
may switch to other brands available at low cost. (Tam Tran, What is Nestlé?
SWOT Analysis Nestle 2019, [online] Available at: https://atpsoftware.vn/nestle-
la-gi-phan-tich-swot-nestle-2019.html, Accessed Aug 20, 2019)
In order to build marketing strategies for Nestle Vietnam Ltd., we study
marketing tactics – the 4ps marketing mix strategy. Marketing mix is a conceptual
framework that is used commonly in doing marketing activities for all lines of
businesses nowadays. It is a major concept in modern marketing, according to
Kotler and Armstrong (2014).It is “a set of tactical marketing tools that the firm
blends to produce the response it want in the target market” (Kotler and Armstrong,
2014). The mean and idea of marketing mix is not surrounding a scientific
theory/concept, but it helps to transforming marketing ideas to implementation and
is a critical tool for decision makers to make principal strategies in providing a
goods/service that can adapt with customer’s needs, according to a research by Goi,
C.L. (2009). Commented [MOU1]: ...

There are two suggested theories which are mostly known and developedin
businesses in coming up with marketing mix strategies. The first model is the
introduction of 4Ps strategies studied and introduced by E. Jerome McCarthy in late
1940s, which is a total strategic package for Product, Price, Place and Promotion.
Then later on in 1990s, the 4Cs model was proposed and become the definition of
the marketing mix. For this 4C models, customer-driven is taken into account when
conducting marketing strategy, and there are 2 marketers having different theories
on the 4Cs, including Lauteborn’s model (consumer, cost, communication,
convenience) and Shimizu’s model (commodity, cost, communication, channel). In
this report, the authors would like to use the 4Ps model to suggest Nestle Vietnam
Ltd. to attain its objectives.
Products : Nestle’s quality policy is: "Good food, good life". Nestle
reaches the needs of customers, thereby creating products that best meet the needs
of consumers. To survive and grow, contentment Customers are the focus of
Nestle. In order to effectively implement and implement quality policies, Nestle
builds a quality management system that meets the requirements of international
standards ISO 22000 and HACCP. With good quality, Nestle products are
continuously ranked in the top of instant coffee business in Vietnam and in the
world.
Price: In terms of price, Nestle's products are rated by consumers as
popular, affordable for everyone.
Places: There are more than 200 distributors nationwide, along with more
than 2000 level 1 agents and retail outlets.
Promotions and related services: In recent years, Nestle has little
advertising activities on the mass media, promotions and organizations are not
regular. Nestle only focuses on organizing events so consumers are less aware of
new products. The company also has a customer service department, specializing in
resolving consumer complaints, answering customer questions ...
To build the marketing strategy for Nestlé Vietnam in the coming time, we
also need to consider some typical product marketing strategies of the Nestlé
Group.
1. Research and develop new products: Researching and developing new
products is the foundation for business success. Grasping the bottom line, Nestle
has continuously focused on developing new breakthrough products to market to
meet different tastes of consumers. For example, Nescafé 3 in 1 helps users save
time on the preparation and also meet the familiar taste for difficult customers to
enjoy homemade coffee, with a combination of coffee and milk. and road. Besides,
to satisfy Italian customers, Nestle produces Cappuccino coffee with the familiar
aroma of the type of coffee that is only available outside the store or it takes a lot of
labor to prepare at home. Not stopping there, with the help of scientists, technicians
of prestigious universities, in 2010, Nestle of its Thai subsidiary launched the
Nescafé Protect Proslim product market. This production strategy made a strong
impression and brought great buzz to Nescafé. This product takes advantage of the
social and psychological development trend of overweight women without training
time, launched products are warmly welcomed not only in Thailand but also in the
Vietnam market. Two large coffee producers in Vietnam, Vinacafe and Trung
Nguyen, seem to have to surrender to Nescafe in this global strategy.
With such a wide range of different products, Nestle helps customers
transition from pragmatic consumption to enjoyment spending as it begins to grow
and transform, creating a wide range of blends. with different recipe and
ingredients. Nestle has global standards and is available in all markets it
enters. There are also subproducts / sub-products that may be available in this
market, but not in other markets that suit the tastes of domestic consumers. Because
Nestle trades in food products, consumer tastes change, so must products. For
example, Vietnam has Nescafé Vietnam, Mexico likes cinnamon-flavored coffee,
Philippines tends to choose chocolate-flavored coffee. The German-speaking
region prefers light-colored milk coffee and the French-speaking part is extremely
fond of black coffee. The nature of products is closely associated with customers
and accompanied by customers from one country to another, so the research and
production strategy must also be globalized.
2. Production linkage and acquisition: As a large group of branches
spanning the whole world, that success of Nestlé must be linked to the strategy of
acquisition and acquisition in research and development and production, which
does not require much human resources. and capital for research and development
and production. In the early 1990s, Nestlé partnered with Coca Cola in teas and
coffees ready to benefit from Coca-Cola's worldwide bottling system and blended
beverage expertise. In Asia, Nestlé's strategy is to gather local companies to form a
group of autonomous regional managers who know the culture of the local market
more than Americans or Europeans. Recently, Nestlé bought Indofood, Indonesia's
largest noodle maker. The main focus is on expanding sales in the Indonesian
market, and in the near future will seek to export Indonesian food products to other
countries. Nestlé has used a broad-based strategy for Asia that involves producing
different products in each country to give the region a certain product from one
country. For example: Nestlé produces soy milk in Indonesia, coffee makers in
Thailand, soy flour in Singapore, candies in Malaysia and cereals in the
Philippines, all of which are distributed in the region. Associated with General
Mills in the 1990s, launching breakfast cereal is a creative idea of Nestlé, because
this is a large corporation, experienced in the production of cereal products and
especially. have a stable number of customers. In 2010, Nestlé had a 29.7% stake in
LOreal - a strategic alliance to create facial creams, open up a new market, hit a
new market segment and simultaneously create customers. new products. In
general, Nestlé not only develops in terms of self-production, but also in
relationships with other corporations to make the "basket" of products more diverse
and suitable for consumer tastes and that This is also the reason why over the past
20 years, Nestle has been constantly growing and reaching out to the world,
crushing many competitors. Besides the connection of Nestlé, Nescafé also
cooperated with Krups to research and develop an automatic coffee machine called
Nescafé Dolce Gusto. This is a unique design, versatile drinking system that
provides customers with diverse beverages of high quality. Although Nescafé could
not meet the exact taste of the product, when it launched, Nescafé quickly gained
the popularity of consumers thanks to its time-saving feature. Craft brewing,
moreover, can be mixed with 4 typical flavors: Cappuccino, Ice Cappuccino, Latte
Macchiato and Hot Chocolate.
3. Research and develop packaging: Depending on the market, Nestle has a
suitable penetration strategy, not only must have a suitable product line, but also
must have because of proportionality. For example, in the Vietnamese market,
during the war on packaging with G7, Nestle launched a type of packaging that hit
Vietnamese consumers using Vietnamese goods, product labels with the seal
"100% Vietnamese coffee. ”. In addition, Café Vietnamese's slogan of using the
slogan "strong coffee for men" also partly helps Nestle to narrow customers and
focus on a more specialized group of customers. Only in the research of product
packaging can distinguish Nestle and competitors in the
industry. Extremely diverse and profound strategies in design help retain fastidious
customers and especially know how to strike into the psychology of
consumers. Society grows faster and more precious time than gold, modern life is
always busy giving rise to new ideas. On November 3, 2009, Nestle launched a
new packaging design suitable to the circumstances, tastes and consumer trends of
Nescafé lon. Although this is not a strange product, it is the first canned coffee
appearing on the Vietnamese market without having to import. Nestle prides itself
on being a pioneer to bring Vietnamese coffee a new form of convenience and style
of developed countries. Moreover, the convenient design that can be taken
anywhere and enjoyed anytime is the most important highlight of this product. This
is the first step to explore a very new market segment for young and dynamic
Vietnamese while also revitalizing the Vietnamese coffee bean. (Nguyet Le Thi,
Nestlé Group's product marketing strategy and lessons learned for Vietnamese
dairy businesses, [online] Available at: http://tapchicongthuong.vn/bai-viet/chien-
luoc-maketing-san-pham-cua-tap-doan-nestle-va-bai-hoc-kinh-nghiem-cho-cac-
doanh-nghiep-sua-viet-nam-47378.htm, Accessed Apr 28, 2017)
4. Products "covering" the market: Nestle is a company specializing in
FMCG industry, this is considered as a key group of the company related to food,
everyday utensils for each family member. Nestle's marketing strategy is to "bring
each product to each family," each product the company creates to meet the needs
of each person in a family, such as:
 Dairy products: There are many nourished dairy products like Nestle,
Nestle slim and Nestle everyday.
 Chocolate: One of the most dominant segments for Nestle is
chocolate. It has popular products like Kitkat, Munch, Éclairs, Polo and Milky
Bar. It also comes with Alpino chocolate to target the gift segment
 Drinks: You all know about Nescafe. This is the largest coffee brand
in the world. It is owned by Nestle. It has worldwide distribution channels.
  Ready to cook foods: Nestle has launched many ready to cook foods
along with cooking products like Maggi masala. Ready to cook noodles - Maggi
one of the biggest hits for Nestle has become a brand of its own with various
products like Maggi Pasta, Maggi sauce and more.
Nestle is the largest food company in the world, it has about 8,000 brands
with a variety of products on the market, forming the backbone of Nestle's
marketing strategy. The biggest strength of the company is its advantage of having
a huge "ecosystem" of products for each product group, giving customers many
choices. Notice, there must be at least one item from this Swiss brand in your
home! Nestle is famous for the quality and taste of its products. Nestle believes that
“Success is built on quality.” This demonstrates that Nestle carefully researches the
usage habits of each market, and creates many products that attack customers, this
strategy of Nestle achieved great success with the number of people using its
products at a very high level.

(Source: Nestle Family)

5. Clear market segmentation
 The majority of Nestle's revenue and revenue come from European
countries, and the Americas. This has led Nestle to collect nearly 90% of its total
revenue for many years. Typically, they follow an FMCG distribution
channel. Bulk products are shipped and delivered to C&F. It is a kind of warehouse
where these products are stored. From there, it is sent to distributors and then to
retailers. Consumers can now buy products through retailers. Therefore,
distributors can easily get discounts on stronger products, if they buy some weaker
products.
 One thing that makes Nestle successful all over the world is thanks to
its incredibly clever market segmentation. The company has penetrated a lot of
markets, Nestle's marketing strategy is to create a large coverage in the market in
many countries and areas they target. Asia is a potential market of Nestle and in
recent years the company has many activities here to increase the "reach" to
consumers. Nestle's market share has increased significantly, and since then it has
benefited greatly from the clear segmentation of the potential of the Asian market.

(Source: estrategiaynegocios.net)
6. Communication is always associated with brand products
 Nestle's marketing strategy is very successful in terms of
communicating the message to its customers. This is the calculation of Nestle
when advertising each product individually, can make customers remember about
each product line they have on the market. Remember the Nescafe appeared on the
market they brought Nescafe melody with "bold" ads, along with the red cup of
coffee on hand with the scent always makes the user remember forever. Because of
the communication factor associated with each of these individual products,
Nescafe's awareness is extremely large, even in Vietnam, despite having to "fight"
with many domestic rivals, but Nescafe still has The market share is quite good
with the right communication strategy.
  Moreover, Maggi is a product worth mentioning that they combine
with 2-minute snacks that can easily be prepared by mothers. This makes it quite
impressive and imprinted on the minds of mothers and children. They always focus
on the quality and nutritional value of the product. In the Indian market, Maggi is a
phenomenon and the product is "divine" when the amount of people using instant
noodles with this product accounts for more than 50% of the market share. This is
thanks to Nestle's marketing strategy hitting advertising based on product brand
factors. The strong presence of Maggi and Nescafe at a very high level has led
them to boost sales and promotions. Nestle uses all media such as TV, print, online
advertising ... (Thang Nguyen, Nestle Marketing Strategy: Rich product ecosystem,
[online] Available at: https://marketingai.admicro.vn/chien-luoc-marketing-cua-
nestle-he-sinh-thai-san-pham-phong-phu/, Accessed Dec 03, 2018)

To turn those strategies into implementation, we make an estimated budget

planning for Nestle Vietnam Ltd. in 2 years – 2020 and 2021. In which, almost of
the budget may be attributed to advertisement and R&D costs, because they are two
core activities of product marketing.
The budget planning for 2020 and 2021 business cycle is expressed as
below.
2020 2021
Total sales (expected) (VND billion)
Total marketing budget (VND billion)
Marketing as a Percentage of Sales )%)
ROI (return on investment)
Table 1: Sales forcast in 2020-2022 period
The ROI (return on investment), in this case, is an increasing portion. The
company is currently having business expansion, and sales of Nestle Vietnam Ltd.
is intend to increase, so it is neccessary to agline such ROI value in light of predict
business sale results.
The budget planning for 2020 and 2021 marketing activities is expressed as
below.
 2020 2021
Advertisement TVs, digital applications
Prints (newspaper, newsletter,
standees, brochures,etc.)
Online kiosks
Social network
R&D Surveying
Sampling and Quality Assurance
Testing
Human resources - headhunt
Total marketing budget

Table 2: Marketing budget for 2-year period.

Media schedule
Advertisement on multi-media will concentrate on January to August in
order to boost car sales during this period. From September to December, there will
be no advertisement on print media and TV media or OOH. The reason is that this
time is near season so people seek more for discounts and car deals than buy a new
car.

Nestle Vietnam Ltd.'s marketing strategy has many similarities with many
other FMCG brands in the market. But, with the differences, Nestle Vietnam Ltd.
has created a certain position in the hearts of Vietnamese consumers. Referring to
the names of fast-moving consumer goods industry in the world, Nestle is a brand
that cannot be ignored at the present time. With the intensive, careful marketing
plan, we believe that Nestle Vietnam Ltd. will have a strong and sustainable
development in the future.
 References
1. Kotler, P. and Armstrong, G. (2014). Principles of Marketing: global
edition. 15th ed. Pearson Education Limited.
2. Goi, C.L. (2009). A review of marketing mix: 4Ps or more? International
journal of marketing studies, 1(1), p.2.
3. About Nestle Vietnam Ltd, [online] Available at:
http://vnr500.com.vn/Thong-tin-doanh-nghiep/CONG-TY-TNHH-NESTLE-VIET-
NAM-Chart--271-2015.html
4. Vietnam dairy market 2018, [online] Available at:
https://www.slideshare.net/StoxPlusCorporation/vietnam-dairy-market-2018
5. Tam Tran, What is Nestlé? SWOT Analysis Nestle 2019, [online]
Available at: https://atpsoftware.vn/nestle-la-gi-phan-tich-swot-nestle-2019.html,
Accessed Aug 20, 2019
6. Nguyet Le Thi, Nestlé Group's product marketing strategy and lessons
learned for Vietnamese dairy businesses, [online] Available at:
http://tapchicongthuong.vn/bai-viet/chien-luoc-maketing-san-pham-cua-tap-doan-
nestle-va-bai-hoc-kinh-nghiem-cho-cac-doanh-nghiep-sua-viet-nam-47378.htm,
Accessed Apr 28, 2017
7. Thang Nguyen, Nestle Marketing Strategy: Rich product ecosystem,
[online] Available at: https://marketingai.admicro.vn/chien-luoc-marketing-cua-
nestle-he-sinh-thai-san-pham-phong-phu/, Accessed Dec 03, 2018