Marketing Management

Final Project Report

Nestle Milk Pak

 Vanquishers

Sonia Bashir (G.L) BB053053

Muhammad Umer Ali BB053030

Junaid Khalid BB053042

At first we are so thankful to All Mighty Allah who gave us the power to do this project.
And after this we are so thankful to our respected teacher Mr.Abid Raheem Khawaja who
gave us a chance to do this kind project to enhance our knowledge & skill of work. At
last we are also thankful to all of those who supported us in completing this project. We
would like to specially thank Mr. Moazam Rasool, Sales Manager Nestle, for his help.
This Report is dedicated to
our parents.
 Table of contents
Introduction of Nestle..........................................................................................................2
Vision Statement of Nestle: Milkpak...................................................................................5
Summary of Operations of Nestle Milkpak.........................................................................7
Contribution to other Sectors...............................................................................................7
The Environment.................................................................................................................7
The Extensive Service of Nestle Milkpak............................................................................7
What is marketed?..............................................................................................................11
Goods.................................................................................................................................11
Types of Demand...............................................................................................................11
Full Demand......................................................................................................................11
Key Customer Markets......................................................................................................11
Customer Markets..............................................................................................................11
How Business and Marketing are changing ......................................................................11
Changing Technology........................................................................................................11
Globalization......................................................................................................................11
Company’s Orientation towards Marketplace...................................................................11
The Product Concept.........................................................................................................12
Marketing Concept.............................................................................................................12
Holistic Marketing.............................................................................................................12
Relationship Marketing.....................................................................................................12
Internal Marketing.............................................................................................................12
Marketing Mix...................................................................................................................13
Product...............................................................................................................................13
Price...................................................................................................................................13
Placement...........................................................................................................................13
Promotion..........................................................................................................................13
Promotion..........................................................................................................................13
Customer Solution.............................................................................................................14
Cost....................................................................................................................................14
Convenience......................................................................................................................14
Distributor Convenience............................................................................................14
Communication..................................................................................................................14
External Communication...........................................................................................15
External Communication...........................................................................................15
Internal Communication............................................................................................16
Feed back...................................................................................................................16
Value Delivery Process......................................................................................................19
Choose the Value...............................................................................................................19
Customer Segmentation.............................................................................................19
Market Selection/focus..............................................................................................20
Value Positioning.......................................................................................................20
Provide Value....................................................................................................................20
Product Development.................................................................................................20
Services Development................................................................................................20
 Pricing........................................................................................................................20
Distribution Services..................................................................................................20
Communication the Value.........................................................................................20
Sales Forces................................................................................................................20
Sales promotions........................................................................................................21
Advertising.................................................................................................................21
The Value Chain................................................................................................................21
The Market Sensing Process..............................................................................................21
The New Offering Realization Process.............................................................................22
The Customer Acquisition Process....................................................................................22
The Customer Relationship Management Process............................................................22
The fulfillment management process.................................................................................22
Core competencies.............................................................................................................22
The Holistic Marketing Orientation and Customer Value.................................................22
Value Exploration..............................................................................................................22
Value Creation...................................................................................................................22
Value Delivery...................................................................................................................23
The Central Role of Strategic Planning.............................................................................23
Corporate and Division Strategic Planning........................................................................23
Defining the Corporate Mission........................................................................................23
Defining the business.........................................................................................................23
Internal Records and Marketing Intelligence.....................................................................25
Order to payment cycle......................................................................................................25
Sales Information System..................................................................................................25
Database, Warehousing, Data mining...............................................................................26
Marketing intelligence System..........................................................................................26
Steps To Improve Marketing Intelligence System.....................................................26
Analyzing the Macroenvironment.....................................................................................27
Identifying the Major Forces ....................................................................................27
Demographic Environment................................................................................................27
Worldwide Population Growth..........................................................................................27
Other Major Macroenvironments.......................................................................................28
Natural Environment.........................................................................................................29
Shortage of Raw Material..........................................................................................29
Increased Energy Costs..............................................................................................29
Changing Role of Governments.................................................................................29
Technological Environment...............................................................................................29
Political-Legal Environment..............................................................................................29
Step 1: Defining the Problem, the Decision Alternatives and Research Objectives..........31
Step 2: Develop the Research Plan....................................................................................31
Data Sources......................................................................................................................31
Research Approaches.........................................................................................................31
Mechanical Devices...........................................................................................................31
Sampling Plan............................................................................................................32
Contact Methods................................................................................................................32
Step 3: Collect Information................................................................................................32
Step 4: Analyze the Information........................................................................................33
Step 5: Present the Findings...............................................................................................33
Step 6: Make the Decision.................................................................................................33
Overcoming Barriers to Use of Marketing Research.........................................................33
Measuring Marketing Productivity....................................................................................33
Customers Loyalty ............................................................................................................36
Nestle Milkpak’s Plan for Building Customer Loyalty.....................................................36
Nestle Milkpak Market to Their own Customers..............................................................36
Nestle Milkpak Listen to the Complaints of their Customers ..........................................36
Nestle Milkpak Reach out to their Customers...................................................................37
Nestle Milkpak’s Loyal Workforces.................................................................................37
Nestle Milkpak Attract and Retain their Customers .........................................................37
Customer Value Proposition ............................................................................................38
Customers for Life ............................................................................................................38
Customer Satisfaction........................................................................................................38
Customer Expectations......................................................................................................39
Measuring Customers Satisfaction....................................................................................39
Periodic Surveys................................................................................................................39
Monitor Competitive Performance....................................................................................39
Quality of Nestle Milkpak..................................................................................................40
Partnership for Better Quality, Health and Economy........................................................40
Milk Collection in Punjab..................................................................................................41
Partnership with Farmers...................................................................................................41
Conclusion.........................................................................................................................42
Service Quality of Nestle Milkpak.....................................................................................42
Total Quality Management in Nestle Milkpak..................................................................42
Maximizing Customers Lifetime Value............................................................................43
Customer Profitability.......................................................................................................43
Consumer Behavior............................................................................................................45
Factors that Effect Consumer Behavior.............................................................................45
Cultural Factors.................................................................................................................45
Subculture .................................................................................................................45
Social Classes....................................................................................................................46
Personal Factors.................................................................................................................46
Reference Groups.......................................................................................................46
Family .......................................................................................................................47
Personal Factors.................................................................................................................47
Age.............................................................................................................................47
Life Cycle Stage.........................................................................................................47
Occupation and Economic Circumstances.................................................................48
Personality and self concept ......................................................................................48
Lifestyles and Values.................................................................................................48
Stages of the Consumer Buying Process............................................................................48
Problem Recognition (awareness of need) .......................................................................49
Information Search............................................................................................................49
Evaluation of Alternatives.................................................................................................49
Evaluation of Alternatives.................................................................................................49
Purchase decision .............................................................................................................49
Post-Purchase Evaluation..................................................................................................49
Organizational Buying in Nestle Milkpak.........................................................................52
Business Market of Nestle Milkpak...................................................................................52
Fewer but Larger Buyers...................................................................................................52
Professional Purchasing.....................................................................................................52
Inelastic Demand...............................................................................................................52
Buying Situations in Nestle Milkpak.................................................................................52
Modified Re-buy ...............................................................................................................52
System Selling....................................................................................................................53
Gold standard customers ...................................................................................................53
Supply Chain Management Orientation.............................................................................53
Stages in the Buying Process.............................................................................................53
Problem Recognition.........................................................................................................53
General Need Description and Product Specification.......................................................53
Suppliers Search................................................................................................................53
Problem Solicitation..........................................................................................................54
Supplier Selection..............................................................................................................54
Order-Routine Specification..............................................................................................54
Performance Review..........................................................................................................54
Local Marketing.................................................................................................................56
Customization....................................................................................................................56
Segmenting Consumer Market...........................................................................................56
Geographical Segmentation...............................................................................................56
Demographic Segmentation...............................................................................................56
Age and Life Cycle Stage..................................................................................................56
Income...............................................................................................................................56
Generation..........................................................................................................................57
Social classes.....................................................................................................................57
Behavioral Segmentation...................................................................................................57
Decision Poles...................................................................................................................57
Behavioral Variables.........................................................................................................57
Occasions...................................................................................................................57
Benefits......................................................................................................................57
User status..................................................................................................................57
Usage Rate.................................................................................................................58
Buyer readiness stage.................................................................................................58
Loyalty Status............................................................................................................58
Attitude.......................................................................................................................58
Sequential Segmentation....................................................................................................58
First Time Prospects..........................................................................................................58
Novices..............................................................................................................................58
Sophisticates......................................................................................................................59
Price oriented customers....................................................................................................59
Solution Oriented Customers.............................................................................................59
Effective Segmentation criteria..........................................................................................59
Evaluating and Selecting Market Segments.......................................................................59
Differentiated Marketing Costs..........................................................................................60
Product modification cost..................................................................................................60
Brand Name of Nestle Milkpak.........................................................................................62
Role of the Brand Name of Nestle Milkpak......................................................................62
Legally Protected ..............................................................................................................62
Organizing Inventory and Account Records.....................................................................62
Level of Quality.................................................................................................................62
Builds Customers Loyalty ................................................................................................62
Create Barriers for the new entrants..................................................................................62
Brand Equity......................................................................................................................63
Components of Nestle Milkpak’s Brand Equity ...............................................................63
Differentiation ...........................................................................................................63
Relevance ..................................................................................................................63
Esteem .......................................................................................................................63
Knowledge ................................................................................................................63
Brand Elements of Nestle Milkpak....................................................................................64
Symbol and Character........................................................................................................64
Packing .............................................................................................................................64
Slogan ...............................................................................................................................64
Criteria for choosing Brand Elements................................................................................64
Memorable.........................................................................................................................64
Meaningful ........................................................................................................................64
Transferability ...................................................................................................................64
Adaptability ......................................................................................................................65
Predictability .....................................................................................................................65
Brand Portfolio Nestle.......................................................................................................65
Brand Strategy....................................................................................................................65
Leverage of Secondary Association...................................................................................66
Marketing Programs...........................................................................................................66
Possible Outcomes for Nestle Milkpak..............................................................................67
Measuring Brand Equity....................................................................................................67
Brand Audit.......................................................................................................................67
Brand Tracking..................................................................................................................68
Brand Valuation.................................................................................................................68
Managing Brand Equity of Nestle Milkpak.......................................................................68
Brand Reinforcement.........................................................................................................69
Brand Revitalization..........................................................................................................69
Brand Crisis.......................................................................................................................69
Devising a Brand Strategy of Nestle Milkpak...................................................................69
Brand Extension.................................................................................................................69
Parent Brand...............................................................................................................70
Family Brand..............................................................................................................70
Line Extension...........................................................................................................70
Category Extension............................................................................................................70
 Brand Mix..................................................................................................................70
Branded Variants........................................................................................................70
Licensed Products......................................................................................................70
Positioning of Nestle Milkpak...........................................................................................72
Positioning Concept of Nestle Milkpak.............................................................................72
Functional Positions...........................................................................................................72
Symbolic Positions............................................................................................................72
Points of Parity ( POPS) of Nestle Milkpak......................................................................72
Point of Differentiation ( PODS) of Nestle Milkpak.........................................................72
Relevence...................................................................................................................73
Distinctivness.............................................................................................................73
Deliveribility Criteria of Nestle Milkpak...........................................................................73
Feasibility..........................................................................................................................73
Sustainability.....................................................................................................................73
Differentiation Strategies of Nestle MilkPak.....................................................................73
Product Differentiation......................................................................................................73
Personnel Differentiation...................................................................................................74
Channel Differentiation.....................................................................................................74
Image Differentiation.........................................................................................................74
Introduction Stage..............................................................................................................75
Growth Stage.....................................................................................................................75
Maturity Stage...................................................................................................................75
Competitive Forces............................................................................................................77
Threat of Intense Segment Rivalry ...................................................................................77
Threat of New Entrants......................................................................................................77
Threat of Substitute Products ............................................................................................77
Threat of Suppliers Growing Bargaining Power ..............................................................77
Identifying Competitors.....................................................................................................77
Industry Concept of Competition.......................................................................................77
Market Concept of Competition .......................................................................................78
Analyzing Competitors......................................................................................................78
Strategies............................................................................................................................78
Objectives .........................................................................................................................78
Strengths and weaknesses..................................................................................................78
Selecting Competitors........................................................................................................78
Competitive Strategies for Market Leaders ......................................................................78
Expanding the Total Market..............................................................................................78
Defending Market Share....................................................................................................79
Premium Performance.......................................................................................................79
Extensive and Efficient Dealership System ......................................................................79
Full-Line Strategy .............................................................................................................79
Good Financing.................................................................................................................79
Other Competitive Strategies.............................................................................................79
Market-challenger Strategies.............................................................................................79
Choosing a general attack strategy....................................................................................79
Frontal Attack............................................................................................................79
 Flank Attack ..............................................................................................................80
Encirclement Attack...................................................................................................80
Guerrilla Warfare ......................................................................................................80
Product Characteristics and classifications........................................................................82
Product levels: the customer value Hierarchy...................................................................82
Core Benefit...............................................................................................................82
Basic Product.............................................................................................................82
Expected Product ......................................................................................................83
Augmented Product....................................................................................................83
Potential Product........................................................................................................83
Product Classifications.......................................................................................................83
Durability and Tangibility.................................................................................................83
Nondurable Goods.....................................................................................................83
Services......................................................................................................................83
Product Differentiation......................................................................................................83
Forms.................................................................................................................................83
Features..............................................................................................................................84
Performance quality...........................................................................................................84
Durability...........................................................................................................................84
Reliability..........................................................................................................................84
Style...................................................................................................................................84
Products and Brand relationships.......................................................................................84
The Product Hierarchy.......................................................................................................84
Product system and mixes.................................................................................................85
Product system...........................................................................................................85
Product Mixes............................................................................................................85
Product Line Analysis........................................................................................................85
Sales and Profit..........................................................................................................85
Core Product..............................................................................................................85
Staples .......................................................................................................................85
Specialties .................................................................................................................85
Convenience items ....................................................................................................86
Prices of Nestle Milkpak....................................................................................................88
Consumer Psychology and pricing by Nestle Milkpak......................................................88
Preference Prices...............................................................................................................88
Price-Quality Interferences................................................................................................88
Price Endings.....................................................................................................................88
Steps by Nestle Milkpak while setting Prices....................................................................88
Selecting the Price Objectives...........................................................................................88
Maximize Long Term Profit......................................................................................88
Maximize Short Term Profit......................................................................................89
Increase Sales Volume...............................................................................................89
Increase Market Share................................................................................................89
Stabilize Market or Stabilize Market Price................................................................89
Company Growth.......................................................................................................89
Maintain Price Leadership.........................................................................................89
 Create Barriers for The New Entrants into the Market..............................................89
Match Competitors Prices..........................................................................................89
Survival......................................................................................................................90
Avoid Government Investigation or Intervention......................................................90
Obtain and Maintain the Loyalty and Enthusiasm of Distributors and Other Sales
Personnel....................................................................................................................90
Enhance the image of the Company, Brand and Product..........................................90
To Perceive as Fair by Customers and Potential Customers.....................................90
Use the price to make the product visible .................................................................90
Get competitive advantage.........................................................................................90
Determining Demand.........................................................................................................90
Price Sensitivity.........................................................................................................90
Estimating Demand Curves.......................................................................................91
Statistical Analysis.....................................................................................................91
Price Experiments......................................................................................................91
Surveys.......................................................................................................................91
Estimating Costs................................................................................................................91
Variable costs.....................................................................................................................91
Analyzing Competitors Costs, Prices and Offers...............................................................91
Selecting a Pricing Method................................................................................................92
Selecting the Final Price....................................................................................................92
Price Adoption Strategies...................................................................................................92
Geographical Pricing.........................................................................................................92
Discounts ..........................................................................................................................92
Promotional Pricing...........................................................................................................92
Promotional Pricing Tactics of Nestle Milkpak................................................................92
Special Events Pricing...............................................................................................92
Designing and Managing Value Networks and Channels.................................................93
Marketing Channels of Nestle Milkpak.............................................................................93
Marketing Communication of Nestle Milkpak..................................................................93
Communication Platforms.................................................................................................93
Advertising........................................................................................................................93
Sales promotions................................................................................................................93
Public Relations.................................................................................................................93
Seminars ....................................................................................................................93
Annual reports............................................................................................................94
Charitable donations .................................................................................................94
Publications ...............................................................................................................94
Steps in Developing Effective Communication.................................................................94
Identifying Target Customers............................................................................................94
Determine the Objectives..................................................................................................94
Attracting and Retaining Customers..................................................................................94
Brand Awareness...............................................................................................................94
Designing Communication ...............................................................................................95
Selecting Channels.............................................................................................................95
Establishing Budget...........................................................................................................95
Factors in Setting Communication mix.............................................................................95
Type of Product Market.....................................................................................................95
Consumer Readiness to make Purchases...........................................................................95
Stage in the Product Life Cycle.........................................................................................96
Nestle Milk Pak

I NTRODUCTION

Vanquishers 1
Nestle Milk Pak

Introduction of Nestle
Nestlé is a multinational packaged food
company, founded and headquartered in
Switzerland. It was set up in 1866 by
Henri Nestlé to provide an infant food
product. Several of Nestlé's brands are
globally renowned, which made the
company a global market leader in many
product lines, including milk,
chocolate, confectionery, bottledwater,
coffee, creamer, food seasoning and pet
foods. Nestlé's corporate reputation is
one of the highest among Switzerland's
largest companies.The company stock is
listed on the SWX Swiss Exchange.

Nestlé is the world's leading food

company. Since it was set up by Henri
Nestlé to provide an infant food
product, it has been associated with
providing high quality, customer and
consumer focused products. In recent
years it has focused on becoming a
nutrition, health and wellness company.
Wellness is about supporting people to
live more healthy lives e.g. through the
development of probiotic yoghurts that
help maintain the balance of the
digestive system.

The company is a world leader in

research and development, and Nestlé's
scientists work in all areas to create
healthier and more nutritious foods.
Nestle is also serving its thousands of
customers in pakistan very efficiently.
In pakistan Nestle is considered as a
symbol of Quality by its customers.

Vanquishers 2
Nestle Milk Pak
Nestle had many brand loyal customers in
all over pakistan.

Vanquishers 3
Nestle Milk Pak

V ISION
STATEMENT

Vanquishers 4
Vision Statement of Nestle: Milkpak
The strategic properties of Nestle Milkpak are focused on delivering shareholder value
through the achievement of sustainable, capital efficient and profitable long term growth.
Improvements in profitability will be achieved while respecting quality and safety
standards at all the time.

In line with this objective, Nestle Milkpak envisions to growth in the shortest possible
time in to the number one food company in Pakistan with the unique ability to meet the
needs of consumers of every age group – from infancy to old age, for nutrition and
pleasure, through development of a large variety of food categories of the highest quality.

Nestle Milkpak envisions the company to develop an extremely motivated and

professionally trained workforce, which would drive growth through innovation and
renovation.

It aspires, as a respected corporate citizen, to continue playing a significant role in the

social and environmental sectors of the country.
OPERATIONS
Summary of Operations of Nestle Milkpak
Production

Joint venture between Milkpak Ltd. And Nestle S.A. came about in 1988 and the
company was renamed as Nestle Milkpak Ltd. Prior to that, Milkpak Ltd., produced UHT
milk, butter, cream, desi ghee and fruit drinks at Sheikhupura factory. 21 branded product
lines were added during 1990 to 1998. Nestle Milkpak operates the largest and an
extremely efficient milk collection system in the country, which enables it to collect the
highest quality milk for production of UHT and powder milks as well as other milk based
products. The company voluntarily provides extension services of farmers in the area of
animal husbandry and livestock breed improvement

Exports

Nestle Milkpak entered the export market in 1993 with exports of Rs.3.2 million to
Afghanistan. Growing steadily over the years, its exports stood at Rs.321 million by June,
1998. Currently, its overseas markets include the UAE, UK, USA, Sri Lanka, Malaysia,
Bangladesh, Afghanistan and Central Asian States.

Contribution to other Sectors

In the social sector, the company provides over 1,100 job opportunities for skilled,
unskilled and professional manpower. It plays a remarkable role in vitalizing the rural
economy by disbursing over Rs.1.37 billion annually against milk purchases, benefiting
over five million household members of the dairy farmers.

The Environment

In line with its universal commitment, Nestle Milkpak fully complies with its
responsibilities forwards the protection of the environment. By making available the
processed and packaged dairy products to urban consumers, it helps in arresting urban
environmental degradation caused by the influx of cattle into towns. Within its own
production facilities, the company takes pains to operate an elaborate water treatment
system to cleanse its industrial wastewater before releasing it for irrigation.

The Extensive Service of Nestle Milkpak

Nestlé Milkpak helped to establish an Extension Service, staffed by qualified veterinary
surgeons. They have provided free consultation on diagnosis and treatment, undertaken
vaccination at cost and held lectures on measures to enhance the quality and quantity of
milk. Last year 130,000 animals were vaccinated to prevent the spread of HS disease
during the rainy season, 80,000 were treated for routine diseases and a de-worming
campaign treated 85,000 livestock

The Extension Service has played a key role in encouraging farmers to establish a co-
operative programmed to improve the breeding quality of livestock. So far, the results,
using artificial insemination and other methods, have been successful and more farmers
are joining the scheme.

Animal nutrition had been another area suffering from under-development. Now, farmers
are given advice on how to use cotton seed cake and molasses as feeding supplements.
Independently it would be difficult for farmers to buy these products; however Nestlé
Milkpak imports high yield seeds, cuttings of fodder crops and bulk quantities of sugar
and sell them to farmers at cost. The Extension Service is helping to educate and
encourage farmers to utilize waste corn to make silage.
REPORT
U UNDERSTANDING
MARKETING MANAGEMENT
What is marketed?
Nestle promote their products through various ways they directly promote their product,
they also promote through events, experiences, persons, and places.

Goods

Nestle is marketing different food products and it is a multinational firm. Nestle Milkpak
is a physical product, it is the most marketed product of nestle food in Pakistan as
compared to its other products.

Types of Demand
Full Demand

Nestle Milkpak is receiving full response from their customers, all the Milkpak stock
places in the market sell out in a projected time therefore Nestle Milkpak have the full

Key Customer Markets

Customer Markets

The main forces of Nestle Milkpak are the consumer markets which are the end users of
this product. Nestle is trying hard in order to create a superior brand image.

How Business and Marketing are changing

Nestle Milkpak is coping with the change they know how to exist in the market for long
time and how to maintain and grow their market shares. Nestle Milkpak come closer to
their customers and creating more satisfying solutions to customer needs.

Changing Technology

As we are in the 21st century technology is changing with time to time. Nestle is aware of
these changes and they are adopting the new technology to increase their efficiency in
production and promotion. They are using internet to advertise their products.

Globalization

Nestle products are available all over the major countries but Nestle Milkpak is only
available in Pakistan. Nestle milk exist in other countries with different names.

Company’s Orientation towards Marketplace

The Product Concept

Nestle Milkpak Believe in the product concept, they give priority to the quality of the
product instead of selling more and more, due to their concentration on quality they are
able to attract their customers mind and fulfilling their need.

Marketing Concept
Nestle Milkpak is practicing the marketing concept. Nestle markets Milkpak according to
the needs of the buyers. The company focuses on satisfying the needs of the target
customers in the best possible way. Nestle also ensures the availability of Milkpak all
over Pakistan. Nestle never compromises on the quality of Milkpak and there are special
laboratories to keep a check on the quality of the product.

Holistic Marketing
If your way of marketing the product is not good then you will waste your money. Nestle
Milkpak is developing designing and implementing the marketing programs very
efficiently. They have the management team which plan the strategies that how will
market their product to aware the customers about new offerings.

Relationship Marketing

Nestle also aims at building mutually satisfying long term relationships with key parties
i.e. customers, suppliers, distributors and other key parties in order to earn and retain their
business. Nestle really cares about its customers and treats them like valuable assets of
the company. Nestle has a special department for this purpose called the consumer
relationship department. This department deals with the complaints and complements of
consumers towards the product or the company and responds towards them. Nestle also
focuses on building the best relationships with its suppliers and distributors because the
company knows that these are the backbone of the company and without their active
involvement nothing could be done.

Internal Marketing

Nestle Milkpak also work on the internal management, by hiring, training and motivating
employees, because if the employees are motivated they will motive the customers to buy
their product, they should know how to market the product to attract the customer
attentions. Top management of Nestle Milk knows how to communicate with the lower
management to make them alert about the steps which are necessary to obtain.

Social responsibility Marketing

Nestle Milkpak have the broader concerns about the ethical, environmental legal, and
social context of marketing activities and programs.

Marketing Mix
Product

Nestle Milkpak is our selected product.

Price

The price of all the milk brands available in the market is controlled by a price regulatory
authority. All the milk brands have the same price.

Placement

Nestle also focuses on the placement of Milkpak and its placement is according to the
target market. Nestle distribution channels also work on the placement of the product.
Nestle Milkpak is available all over Pakistan. The distribution channels also work on the
in shop placement of the product from where the product is clearly visible by the
customers.

Promotion
Nestle designs its promotion programs in order to get response from the consumer. Most
of the promotion programs are designed to involve the consumers. Promotion activities
are performed to attract the target costumers towards the product. Nestle has a separate
Consumer Relation Department. This department also performs different type of
activities in order to involve the target consumers and make them aware about Nestle
Milkpak. Different teams are formed which arrange activities like road shows. Different
functions are also arranged in schools to aware the children that milk should be a part of
their daily diet

Promotion

The promotional strategies of Nestle Milkpak are designed according to the areas. These
promotional strategies can vary from city to city. The advertisement material used for the
promotion of Nestle Milkpak is designed by the special agencies hired for this purpose.
These agencies design the promotional programs and then these programs are approved
by the Nestle Headquarter and then these programs are implemented. The sales force and
sales network of nestle is very strong that is why nestle Milkpak is available all over
Pakistan. This shows the strength of the sales force of Nestle. Public rationing activities
like road shows etc are organized in order to involve the general public and attract them
towards the Nestle Milkpak.
Customer Solution

Nestle Milkpak is a product according to consumer demand. Nestle Milkpak is designed

to provide the consumer with best quality and durable product. There is no need to boil it
and it is also very good from a hygienic point of view. Nestle Milkpak id different from
its competitor milk brands available in the market in quality. It contains less fats and its
thickness is normal. Everybody can use Nestle Milkpak

Cost

The major cost which nestle Milkpak has to bear is the milk collection cost. But now the
company is concentrating on building farmhouses of their own and for this reason Nestle
has bought 10000 Australian cows as the first step. This step will not only reduce the
company’s cost but will also help to reduce the shortage of milk. Then there is the
processing cost. This cost includes all the labor salaries, plant and equipment cost. Nestle
Milkpak has purchased new plants and advanced technology is being used by the
company. The company also bears a storage cost. There are special storage centers for
milk where temperature is controlled in order to keep the milk fresh and good.

Convenience

Nestle provides convenience to its customers. Nestle ensures to make Milkpak available
throughout the year. Nestle matches the demand with the supply in this case which
increases the consumer satisfaction with the product. As nestle Milkpak is available in the
market in different packaging in order to provide ease to the target consumers and they
can have the quantity of milk according to their need. The packing of Milkpak also
provides ease to the consumers. The tetra packed milk’s life is more then the fresh milk
and also the quality is maintained. Milkpak can be opened easily and you can get the
same fresh mil anytime.

Distributor Convenience

Milkpak also provides convenience to its stockiest and distributors. Nestle ensures that it
always provides the fresh products to its stockiest. If there is some problem with the stock
then the company easily replaces that in order to keep its goodwill among the target
customers and the key parties.

Communication

Nestle Milkpak involves thee types of communication. These are as follows

• External communication
• Internal Communication
• Feed back
External Communication
External communication means the communication done by Nestle in order to attract its
customers towards the product. External communication is used to communicate the
product values to the customers. Different types of communication medium are used for
external communication.
• Advertising
– TV
TV ads are used for externally communicating the product values
and creating awareness in the target market. In the TV
advertisements of nestle Milkpak a whole family is shown because
Milkpak is a family product and is fit for all.
– Newspapers
Newspaper ads are also given by Nestle Milkpak in different well
known newspapers. These ads are mostly given at different
festivals or occasions like EID etc.
– Radio
Nestle also organizes radio shows in order to increase awareness
about the benefits of milk usage in daily life. Milk is extremely
important for all and at all ages.
• Events and experiences
Nestle Milkpak is also advertised though different events and experiences.
Nestle organizes different concerts through which Nestle Milkpak is
advertised. In schools Milk Days are celebrated and mothers are invited
and the products presented in front of then and there on the spot their
quarries are solved about the product.

• Personal selling
According to Nestle personal selling is of more importance and more
rewarding then any of the other promotional activities like TV ads.
The reason behind this is that a TV ad costs a lot and is very much
expensive. On the other hand printed posters and banners are also very
costly and not given much importance. So the best to communicate their
product to the end user is by involving the end user and getting its
attraction so that is why the ads of nestle are less in number because they
are concentrating more on public relationing.

External Communication

• Brand awareness
The first objective is to create the awareness about the brand in the target
customers. To inform that the product is available in the market and also
about the key features of the product.
 • Brand image
Communication is also done to create a positive brand image in the mind
of the target customers. This image creation is a big motivational factor
which encourages a consumer to buy that product.

• Brand responses
External communication is done to get brand reposes from the target
market. This phenomenon works in the same way as the Newton’s third
Law of Motion “Every action has a reaction, equal in magnitude but
opposite in direction”. The information communicated by the company is
the action of the company and as a result the brand responses are the
reactions which the company gets.

• Brand relationship
Brand relationship is also established through communicating the
information about the brand to the target customers. This helps in getting
the customers and having their attachment with the brand.

Internal Communication

• Trainings
Different types of training sessions are also organized with in the
organizations. For these training sessions organization employees and
outside trainers are hired. These training sessions are really very important
because trainees learn new techniques through these training sessions.
Trainees are also sent to different places to attend these training sessions.

• Meetings
Meetings are also arranged in order to discuss the company performance.
And also the ways how Milkpak can be promoted to retain and increase its
market share.

• Seminars
Seminars are also conducted by nestle. There are two types of seminars.
Seminars which are conducted to increase the motivation level of
organizational employees. Seminars are also conducted outside the
organization in order to promote Nestle Milkpak and communicate its
advantages to the target customer.

Feed back

• From the collection unit

The company gets feedback from the collection unit about the milk
collection in the concerned areas. This feedback also contains the
information about the competitor activities in those areas. This data is then
 processed and information is extracted from that. This information is then
used by the management for decision making.

• From the sales unit

Feedback is also taken from the sales unit. This feedback is concerned
with the sales in the different areas. It also contains the info about what
other competitors are doing to penetrate into the market. Decisions are
made on the behalf of extracted information from this data.
• From Customer
Feedback from the customer is very much helpful. The customer tells
about the problems in the product. This is very much positive because
through this the company can continuously move towards the betterment
in the product. Nestle Milkpak’s positive response to the customer also
helps to make the customer realize that the company cares about him
N ESTLE & 21ST CENTUREY
Value Delivery Process
We can define that we have two ways of value delivery process, one is traditional and
second one is modern. In traditional process only companies concentrate on their sales
not on their customers satisfaction but modern value delivery process are such process,
through which companies concentrate on their customers values not on their sales
volumes.
Customer Segmentation
Choose the Value Market Selection/focus
Value Positioning
Product Development
Services Development.
Provide the value Prices
Sourcing Making
Distribution services
Sales Forces
Communicate the
Sales Promotion
Value
Advertising
Nestle Milk Pak always focus on this Value Delivery Process.

Choose the Value

Customer Segmentation

Nestle Milk Pak segments their customer on the basis of users and market demand, we
can define it into two ways
They increase their Milk Pak product line as
• Nestlé Milk Pak
• Every day UHT
• Nesvita
They also segmentized their product on SKU basis, and they increase their product depth
as follow
Milk Pak
250 ml
500 ml
1000 ml
1500 ml
Every Day UHT
125 ml
200 ml
375 ml
Nesvita (HCLF)
1000 ml
500 ml
200 ml
Market Selection/focus

Every sales and marketing department of any organization have different criteria and
different focus in selection of their target customer, so Nestle Mil Pak focusing on upper
lower, middle and lower middle class market. And they also focusing on such customers
who want to use quality product and health conscious and they also have purchasing
power. They tried to target all age groups through their SKU division.

Value Positioning

Now Nestle Milk Pak are positioning it self as a number 1 brand all over the country,
present their self a top quality brand, and they a proper and strong shelf space, reasonable
prices as per competition, availability every where.

Provide Value
Product Development

As per observation an need of their customers, Milk Pak get further development days by
day.

Services Development

Nestle Milk Pak is available through out country through their strong distribution system.

Pricing

Nestle Milk Pak have reasonable prices as per their other competitors. They have
following prices,
• 250 ml Rs. 12
• 500 ml Rs. 22
• 1000 ml Rs. 38
• 1500 ml Rs. 57

Distribution Services

Nestle Milk have well organized and established distribution system, and which
providing services through out the Pakistan and making sure the availability of product.

Communication the Value

Sales Forces
Nestle Pakistan have a sales force which monitor all brand activities and also Nestle Milk
Pak. Sales forces hierarchy is as follow,
 National Sales
Manager

Zonal Sales Manager

Area Sales Manager

Territory Manager

Sales promotions

Nestle Milk Pak have several sales promotion activities for retain in the markets, Milk
Pak have several type of sales promotional activities as follow
• Free sampling
• Special display drives
• Schemes
• Incentives for disturbers on achieving their targets
• Incentives for whole sellers and retailers on purchase of specified quantity
• Town storming.
• Branding activities. etc

Advertising

Nestle Milk Pak spending huge amount on media covering because this is the media time
who move to the media with innovative idea can capture the market.

The Value Chain

“Value chain is a tool for identifying way to create more customers value”
Milk Pak also try to delivery more and more customer value and value added services.

The Market Sensing Process

Sales forces are playing role to get information for top management and top sales
management then take action on this matters.

The New Offering Realization Process

In this process their brand management is totally involved.

The Customer Acquisition Process

To acquire new customers and to keep retain old, Nestle have planned several activity
like, free sampling, free test drives, and Nestle also keeping a separate department named
as Consumer Services. This department arrange small level of function in schools
Mohullas, villages etc, where they present company’s product with effect presentation
and to create awareness regarding products.

The Customer Relationship Management Process

Consumer Services Department is playing this role to develop and maintain relations. On
other hands Nestle sales representative are most important source to manage the relations.

The fulfillment management process

Milk Pak all activities are accordingly this definition.

Core competencies
Nestle Milk Pak have following over competencies
• Quality
• Strong Distribution system
• Advance production system
• Strong Market knowledge of their Sales forces
• Expert Man forces

The Holistic Marketing Orientation and Customer Value

Value Exploration

“How can a company identify new value opportunities?”

Nestle milk Pak continuously concentrate on their segmentation which horizontally and
vertically.

Value Creation
“How can a company efficiently create more promising new value offerings?”
Nestle Milk Pak providing quality products and make sure the availability of their
products.

Value Delivery
Delivering value often means substantial investment in infrastructure and capabilities.
The company must become proficient at customer relationship management. Customer
relationship management allows the company to discover who its customer is how they
behave and what they need or want. So nestle milk Pak delivering value delivery in sense
of all above mentioned theory.

The Central Role of Strategic Planning

Successful marketing thus requires companies to have capabilities such as understanding
customer value, creating customer value delivering customer value, capturing customers’
value and sustaining customer value. Nestle Milk Pak
Corporate and division strategic planning

Corporate and Division Strategic Planning

Defining the Corporate Mission

“To provide quality product to their target market/consumers with reasonable profit”
Industry
FMCG
Products and applications
Milk Pak UHT
Competence
Quality, prices, strong distribution system.
Market segment
Milk Pak segmentised their market on basis of users
Geographical
They are targeting whole target market, and they are covering whole with
their strong distributional systems.

Defining the business

Milk Pak, is supplying Milk to their customers

G athering information
& decision making
Internal Records and Marketing Intelligence
The internal marketing intelligence of Nestle Milkpak are well considered by the
organization

Order to payment cycle

Payment cycle is divided in to two types one is collection from sales and one is payment
to their milk suppliers, tables are as follow.

Payment receive cycle

Nestle Pakistan

Handling Agents

Distributors

Retailers and whole sellers

Payment cycle to their milk suppliers

Nestle Pakistan

Milk Collection deptt.

Area Collectors

Milk Suppliers

Sales Information System

For sales information nestle have a entirely separate department with the name of Sales
Admin departments, which monitor and collect the information from handling agent and
distributors which consist on daily purchase and sales. Sales Admin Department, updates
the information daily, and in this information collect they also generate some comparison
with last year. They monitor daily bases sales and also follow all products and SKU, and
which distributor or area not performing accordingly they give them proper feed back or
some other backup information to their area managers and territory incharge to take some
reasonable actions.

Database, Warehousing, Data mining

As we have mentioned that their and data properly updated at daily basis, so Nestle have
provided centralized software which is names SNOW and this soft ware is totally
centralized and every one have access only on concerned function and Sales admin
department feed information regarding sales at daily basis. Nestle have huge server,
which based in their head office which is controlling all activities. Every person like
Branding department have access on their concerned information and they can take action
regarding brands, and Sales monitoring department can take action according and also
promotional department can plan activities accordingly. So we can say that data mining
place is head office where they develop explore plan and strategies regarding Milk Pak.

Marketing intelligence System

Nestle Pakistan’s biggest marketing intelligences are their sales forces (Area Managers,
and Territory Head) who are directly connected to their target market and who are
observing all activities of their competitors and suggesting solution regarding these
competitions. So, if we summarize, then we can say that their most effective Marketing
intelligence system and force is their sales force.

Steps To Improve Marketing Intelligence System

• Train and motivate sales force. Nestle Pakistan management have a proper
training programs for their sales forces and special training sessions for their
distributors and for their sales men because their distributors and their sales
representatives are pure company’s representative.

• Motivate channel members to share intelligence: Nestlé’s distributors are

highly motivated and especially when they observe any kind of activity in their
area they inform to the company representative and he take action accordingly his
or her power.

• Network externally: accordingly definition of this heading company have

information regarding competitors activity, so Nestle properly alert about their
competitors activities, now they are facing only one competition which is name as
Olpers because their sales and marketing campaign is too much strong but Nestle
representatives are properly alert and they adopt defensive strategy before
launching of Olpers in any area.
 • Utilize customer advisory panel: Nestle have various types of customer advisory
panels, like they sales representative in a specified area are getting proper feed
back for their target customers and they are properly aware about their targets
customers need and wants.
• Purchase information: Nestle have proper purchase plan at the basis of their past
history and accordingly their new action which they have adopt to increase their
productivity.
• Collect customer feedback online: As such they are not so much update
regarding online feedback because a huge quantity of their customers are such
customers who are illiterate or unaware about this technology. So, for feedback
about product and campaign they are providing their postle address and their
phone number.

Analyzing the Macroenvironment

Needs and trends

Nestle Milk Pak have created a need and then set a trend and mega-trend.

Needs

People need such milk which is durable for some time, so they present milk in packed
form which customer can use with 3 months after processing and production.

Trends

We can consider them as a trend setter as before Milkpak there was very small concept to
use packed milk, but every body prefers to use packed milk because it is totally germ free
and durable.

Identifying the Major Forces

Nestle properly giving concentration on their Major forces, because they believe to
deliver quality with reason able prices, so they are keep interest of all Major forces.

Demographic Environment
The demographic environment in Nestle Milkpak is given importance by the company.

Worldwide Population Growth

Population growth is a biggest reality, it is a problem but its also a major factory which
play a role in business and sales growth, so due to population growth and with other
factors now Milkpak have 15-25% through out Pakistan.
Educational Groups

Nestle Milkpak is now targeting almost all educational groups, but if we analyze the
original ratio of MILK PAK user then we can find out, Milk Pak’s customers are such
customers who are properly aware about health and quality product.

House Hold Patterns

We can easily analyze that Milk Pak have separate range for their house hold customers
in shape of 1500 ml pack for family use, and Milk Pak have four types of SKU of their
products,
250 ml
500 ml
1000 ml
1500 ml
We can analyze that they are following all types of house hold patterns and they are
presenting their products accordingly their users.

Geographical Shifts in Population

This is also a biggest effect on sales, so in Pakistan after earthquake, their was a big
geographically shift in population, so due to this coz their was great increase in sales
especially in Kashmir area. If we compare 2005, 2006 and 2007 sales then we can
analyze that there is big sales growth due to geographic population shift.

Other Major Macroenvironments

The major micro environment of Nestle Milkpak counts a lot in their organization for
the management of daily activities

Economic Environment
Marketing require purchasing power as well as people, the available purchasing power in
an economy depends on current income prices saving, debit, and credit availability.
According this definition Milk Pak presenting their brand accordingly their customers
purchasing power and accordingly their usage.

Social Cultural Environment

Purchasing power is directed toward certain goods and services and away from others
according to people’s testes and preferences. Society shapes the beliefs, values and norms
that largely define these tests and preferences. Firstly, we can say that Milk Pak’s prices
are accordingly customers purchasing power and taste which company presenting for
their target marketing accordingly their customers, and their taste is much closer to nature
and customers taste.
Natural Environment

The natural environment of Nestle MilkPak is really important for their success because
there is competition is all around.

Shortage of Raw Material

Every year Milk Pak face problem shortage in milk collection due to hot weather, and
this shortage remain for 3 to 4 months every year.

Increased Energy Costs

Under current scenario we can analyze that due to increase in energy producing material,
that’s why all other Milk brand also changing their rates.

Changing Role of Governments

This point we can also count here, coz taxation and other policies some times effect the
prices and other policies.

Technological Environment

Technological environment highly effecting product, so Nestle Milk Pak, using highly
advanced technology for processing, packing etc, and currently they have start new plant
in Khanawal for the sake to meet customer needs.

Political-Legal Environment

As it’s a multinational brand, so when ever any religious moment awake, they include the
name of Nestle Milk Pak in their banned product lists, so such events effect it badly.
Increased business legislations
Growth of special interest groups
R ESEARCH PROCESS
Step 1: Defining the Problem, the Decision Alternatives and
Research Objectives
Researches are mostly conducted by companies, when they are facing problems, so Milk
Pak also facing various problems in their daily matters, like quality, prices, and
competition etc. so for this matter they have various departments.

Step 2: Develop the Research Plan

Nestle Milk Pak also develop several research plan, like in different times, they got
complaint regarding quality, error in packing etc. then they send a special team in
specified area who research out the basic routs why this thing happened and they also
define that where is problem.

Data Sources

Regarding sales figure and also regarding target market their sales representative are big
source to collect information regarding desired objective.

Research Approaches

Nestle Milk Pak also using all below mentioned research methods on different times and
situation.
• Observational Research
• Focus Groups Research
• Survey Research
• Behavioral Data
• Experimental Research
• Questionnaires
• Qualitative measures
 Shadowing
 Behavior mapping
 Consumer journey
 Camera journals
 Extreme user interviews
 Storytelling
 Unfocused Groups

Mechanical Devices

Nestle also using this method for their research data and also for their new customers to
whom they are plan to target. In this whole process, their one separate department named
as Sales Promotion involved, they have proper complete work force for a specified region
who involve such activities which directly correlated to their customers. In nestle
department they have another department Named as Consumer Services, who arrange
different Mohala “street” shows and presenting Milk Pak and creating awareness about
the usage of this brand.

Sampling Plan

Nestle Milk Pak follow their sampling plan as follow:

Sampling unit
All SKUs of Nestle Milk Pak

Sample size
Accordingly their selected areas

Sampling procedure
Nestle Milk Pak using different methods such as
• Free test drive
• Functions
• Mohala shows
• Town Storming
• Sponsorships etc.

Contact Methods

Nestle Milk Pak also using all below mentioned method to get proper feed back
from their customers, and also proper way to know that what kind of innovation
their target market want, easily they can evaluate and adopt it.

• Mail Questionnaires
• Telephone Interviews
• Personal Interviews
• Online Interviews

Step 3: Collect Information

Regarding sales figure Nestle milk Pak have Sales Admin department in all regions
which have updated city wise, SKUs wise, brand wise all information at daily basis.
Secondly Nestle Milk Pak have second biggest source to collect information from their
customer are their Sales forces which directly connected with their markets and
monitoring daily sales moments and their competitors activities. If sales management
need any kind of information then regarding market then they specified their required
information and they sales department provide them concerned information.

Step 4: Analyze the Information

All levels of sales management involve in information analysis, they pick their required
information from flow of data transferring and take decision accordingly.

Step 5: Present the Findings

Sales control and Admin department find out results from sales data and then present RIG
(Real Internal Growth) brand wise, volume wise, value wise, area wise, etc. and pass this
information from top to bottom for proper action

Step 6: Make the Decision

Top management National Sales Manager, Sales and Marketing Manager, and Brand
Manager make the decision at the basis of findings and then develop the polices Zone
wise, and Zone Sales Manager develop policies under guidelines of top management for
his regions and then Regional Sales Manager took action accordingly and covey the
message to Area Managers and to their Territory manager. Finally who implement all
policies and decision on market and find out the results and then convey back the results
as per previous mentioned circle.

Overcoming Barriers to Use of Marketing Research

If we study theory then we can find out 5 barriers in use of data are as follow:

1. A narrow conception of the research

2. Uneven caliber of researchers
3. Poor framing of the problems
4. Late and occasionally erroneous findings
5. Personality and presentation differences

But in case of nestle mostly top management and brand managers are taking decision
without proper market research, just they think that company need these kinds of
modification and they develop these changes. That’s why some times their strategies not
supporting and targets because they have not used properly market research.

Measuring Marketing Productivity

If we measure marketing productivity then we can find out that Milk Pak
Marketing productivity is best in the market because Olpers now spending a
huge amount on media, which is higher then all brand media cost. Now days
Haleeb facing problem of short expiry, they are loosing their customers
 C REATING CONSUMER
VALUE SATISFACTION &
LOYALTY
Customers Loyalty
Nestle Milkpak is well aware of the importance of customers Loyalty that Increasing
competition is forcing businesses to pay much more attention to satisfying customers in
the modern world where competition is all around. Nestle Milkpak give utmost priority to
their customer’s satisfaction as it is the deeply held commitment to re-buy or re-patronize
a preferred product or service in the future despite situational influences and marketing
efforts having the potential to cause switching behavior.

Nestle Milkpak’s Plan for Building Customer Loyalty

Nestle Milkpak had a comprehensive plan to maintain their customers loyalty

1. Nestle Milkpak introduce such Products that are highly differentiated from those
of their competitors like Haleeb, Everyday, Olpers and others.
2. Nestle Milkpak introduces Higher-end products where price is not the primary
buying factors.
3. Nestle Milkpak’s Products are available for the customers with a high service
components.
4. Also Nestle Milkpak introduces multiple products for the same customer like
there are other are other milk products like Nestle Cream, Nestle Yogurt and
many other variety of Milk made products are available for their customers.

Nestle Milkpak Market to Their own Customers

Nestle Milkpak gives a lot of thought to their marketing programs aimed at current
customers is one aspect of building customer loyalty. They are well aware of their main
customers and at the same time they are also aware of the fact that to remain in the hearts
of their customers there is really a need of some attractive and reality based
Advertisement that is specially designed according to the taste of their customers. Nestle
Milkpak really want to keeping touch with their each customer but it is not possible as
there are millions of customers therefore to remember their customers on different
important occasions special ads are designed to wish their customers and also discounts
are offered on some occasions like Ramadan.

Nestle Milkpak Listen to the Complaints of their Customers

Usually it happen that when customers aren't happy with any of the business they usually
won't complain to that company - instead, they'll probably complain to just about
everyone else they know - and take their business to your competition next time. That's
why Nestle Milkpak making follow-up calls also goes for mailing satisfaction
questionnaires, and also questioners are filled by the customers after the sale is made.
Customers are also given an opportunity to contact the through internet with any kind of
complaining regarding Nestle Milkpak. They find that if they promptly follow up and
resolve a customer's complaint, the customer might be even more likely to do business
than the average customer who didn't have a complaint.

Nestle Milkpak Reach out to their Customers

Nestle Milkpak is of view that Contact . . . contact . . . contact with current customers is a
good way to build their loyalty. The more the customer sees someone from your firm, the
more likely you'll get the next order. That is why Nestle Milkpak remembers their
customers in different occasions.

Nestle Milkpak many times send newsletter to their customers-tell them about the great
things that are happening at their firm and include some useful information for them
regarding the quality and purity of the product. Many times seminars are conducted by
Nestle Milkpak and the customers are invited to free seminars because Nestle Milkpak
had a concept that the more their customers know about them, the more they see them as
someone out to help them, the more they know about their accomplishments-the more
loyal a customer they will be towards Nestle Milkpak.

Nestle Milkpak’s Loyal Workforces

To be successful in building customer loyalty Nestle Milkpak have a loyal workforce.

Nestle Milkpak retain sales people, technical support, and customer-service employees
who interact with customers. Nestle Milkpak give a lot of attention to retaining sales
people. Especially sales people are given very much importance as they are considered as
ambassadors of the company as they are going to represent Nestle Milkpak among
millions of customers. They are given much importance so they could feel themselves as
a part of the company.

Nestle Milkpak Attract and Retain their Customers

For the purpose of Customers Loyalty Nestle Milkpak attract and retain their Customers
along with their employees. They don’t want to loose their customers in any case that is
why they respond to their customers in a very positive manner. To retain their customers
Nestle Milkpak brings different variety of products with the passage of time according to
their taste and their requirements. Also they bring different offers for their customers
along with their products which are very well known for the quality provided by Nestle
Milkpak. To attract their customers they provide best quality products with reasonable
prices. Through research conducted by Nestle Milkpak they came to know that majority
of their customers is quality conscious rather than price that is why their main target is
providing best quality products.
Customer Value Proposition

From the customer's point of view, any company exists only to create value for them, to
provide them with results. Nestle Milkpak deliver a particular customer value proposition
to a definable market in order to exist. Nestle Milkpak is well aware of all the happenings
and the activities held by their competitors
In the rapidly changing economy, the focus of Nestle Milkpak is on the way in which the
nature of value is changing, involving new ways to price goods, innovation and emotion.
Nestle Milkpak identify these hidden values and think more accurately about their worth
before accepting the price proposed. The implications are profound. Nestle Milkpak think
in terms of offers, which involve merging products and services to exploit their
knowledge to give customers a value-added experience, not just "selling them stuff".
Nestle Milkpak provide their customers with all the possible cluster of benefits that they
promises to deliver.

Customers for Life

The main purpose of Nestle Milkpak is to create and keep a customer. The two most
important words that Nestle Milkpak keeps in mind in developing a successful customer
base are Positioning and Differentiation
Differentiation refers to their ability to separate themselves and their products and
services from that of their competitors. And it is the key of Nestle Milkpak’s in building
and maintaining a competitive advantage. This is the advantage that they have over their
competitors in the same marketplace – the unique and special benefits that no one else
can give the customer rather than Nestle Milkpak.

Customer Satisfaction

Customer Satisfaction, a business term, is a measure of how products and services

supplied by a company meet or surpass customer expectation

In a competitive marketplace where businesses compete for customers, customer

satisfaction is seen as a key differentiator and increasingly has become a key element of
business strategy for Nestle Milkpak. Nestle Milkpak preferred to have more and more
satisfied customers for this particular purpose they provide qulity products and services
and are always busy in bringing innovations to their products. Its their priority to have
more satisfied customers . usually it is thought that customer satisfaction is gained by
offering lower prices but same is not the case with Nestle Milkpak. Nestle milkpak’s
prices are neither too high nor too low they have modrete prices for their customers.
Nestle Milkpak have competive edge of providing variety of quality and pure products to
gain customer satisfaction.
Customer Expectations

A customer expectation is the experience formed by the customers based on past buying
experience. Nestle Milkpak’s customers have pleasant past buying experience with
Nestle. Nestle Milkpak’s marketers play a vital role in building pleasurable customer
satisfaction. Usually it is thought that with higher expectations there are going to have
disappointed customers but same is not the case with Nestle Milkpak, they raise their
expectations and also at the same time they are delivering attractive performances to
perfectly match the raise in the expectations.

Measuring Customers Satisfaction

Customer satisfaction is an ambiguous and abstract concept and the actual manifestation
of the state of satisfaction will vary from person to person and product/service to
product/service. The state of satisfaction depends on a number of both psychological and
physical variables which correlate with satisfaction behaviors such as return and
recommend rate. The level of satisfaction can also vary depending on other options the
customer may have any other products against which the customer can compare the
organization’s products
Nestle Milkpak is increasingly interested in retaining existing customers while targeting
non-customer. Nestle Milkpak is also engaged in measuring customer satisfaction
provides that is an indication of how succesful Nestle Milkpak is at providing the
products at the market place.

For measuring Customers Satisfaction Nestle Milkpak use different impresive techniques
to know what is happening in real manner. Nestle Milkpak use the following techniques
to measure customer satisfaction.

Periodic Surveys

Nestle Milkpak preferred to conduct periodic survery to inow the level of their customers
satisfaction. During periodic surveys questions are asked regarding the product. Many
times questions regarding the value added to the products are also asked. Nestle
distrubute questionier among the customers regarding Nestle Milkpak. Through
eveluation Nestle Milkpak came to know that what is the rate of satisfaction of their
customer. many times changes are brought to the products by keeping in view the
demands of the customers.

Monitor Competitive Performance

Nestle Milkpak is well aware of the position of their competitors. Nestle Milkpak try to
know about all the facts related to their competitors and on the basis of those
informations they try to develop their competitive edge over their competitors.
Sometimes Nestle Milkpak make changes in their prices with the price changes by the
competitors. The company knows all about their competitors that’s why Nestle Milkpak
ia ahead of all their competitors and grap major shares in the market as compare to their
competitors like Haleeb, olpers etc.

Quality of Nestle Milkpak

Nestle Milkpak provides best quality Products to their customers. There is complete
check and balance on the hyganic conditions of the products. Nestle Milkpak contains all
the necessary ingredients which are helpful for health. Nestle Milkpak contain a proper
quantity of calciumn in it. The product is well known among its customers for the best
quality they provide. In the beginning the pack of Nestle Milkpak was having 3 layers but
noe two more layers have been added to protect it from the effects of sunlight and many
other climatic changes. The amount of useful ingredients also have been included in the
product.

Partnership for Better Quality, Health and Economy

Pasteurized milk is still a rarity in Pakistan. The comparatively high levels of bacteria,
which can be found in unpasteurized milk, can be a health hazard for both young and old.

Since its establishment in Pakistan, Nestlé Milkpak has been involved in many
community partnership initiatives; one of the most successful is the inception of milk
collection centers, which have revolutionized the collection and storage of milk in the
Punjab region of Pakistan. This partnership initiative has benefited local farmers, who get
a better and more constant price for their milk, and Nestlé, which gets better quality milk.

The Punjab covers an area of 72,000 km2 and produces 75% of Pakistan's milk. Before
the milk collection initiative, Punjabi farmers sold their milk to dodhis, middlemen who
were in a position to control prices. This meant that farmers had no guaranteed income -
the do this were under no obligation to take the milk the farmers produced and did not
pay a consistent price for the milk. Dependent on seasonal variations in milk production,
a single source for sale of their milk and irregular income, farmers always remained at a
disadvantage. This system brought down quality, which was good neither for local people
nor for large buyers of milk such as Nestlé Milkpak. The milk would often be
contaminated by bacteria in transit to the distant urban areas - the absence of cooling
tanks, prolonged collection times and the addition of lumps of ice from unsafe water, all
contributed to the problem

The partnership has focused not only on increased milk production, but also livestock
development to improve milk quality and quantity. Improved food safety was also an
objective, as pasteurized milk is still a rarity in Pakistan. The comparatively high levels
of bacteria that can be found in un pasteurized milk can be a health hazard for both young
and old. All parties are thus keen to ensure high quality milk is available and the milk
collection initiative was set up to does just that.
Milk Collection in Punjab
Nestlé thus devised a new system of milk collection in conjunction with local farmers and
communities. In the Punjab region, over 2,400 new Village Milk Centers (VMCs) have
been established. Farmers bring milk to the centers each morning and evening, where the
VMC agent records their contribution, no matter how much or how little that may be. The
milk is also tested for its fat and bacteria content.

The partnership has focused not only on increased milk production, but also livestock
development to improve milk quality and quantity. Improved food safety was also an
objective, as pasteurized milk is still a rarity in Pakistan.

From this point the milk is taken by lorry to one of the 500 'Chillers' that have been
installed in the region, where the milk is cooled to maintain the quality and prevent
bacteria growth. If it has taken longer than three hours for the milk to arrive at the
chillers, then it is not accepted for reasons of hygiene quality. From the chillers a fleet of
70 tankers take the milk to the Nestlé Milkpak factories where it is used in food
production

All these processes have helped to ensure that milk quality in Pakistan has greatly
increased in the three years that the VMCs have been in operation. The average fat
content in milk has risen from 4.7% to 6%, solid non-fats have increased by 2% to 8%
and the total plate count of bacteria has fallen significantly.

Partnership with Farmers

The cornerstone of Nestlé Milkpak's program is the strategic partnership with farmers.
The farmers are paid a set rate for their milk, which gives them greater security and
consistency of income. The prices are set every season so that the farmers know how
much they will receive depending on the quality and volume of the milk they bring to the
centers. In the Punjab, over 120,000 farmers contribute 165 million liters a year to the
VMCs and benefit from a regular weekly income. Nestlé Milkpak paid over 2 billion
rupees in 1999 for milk they have received form the VMCs, which has meant a better
return for farmers in the rural economy as well as a guaranteed supply of good quality
milk for Nestlé.

The milk collection initiative has also led to other benefits for the farmers of the Punjab.
Farmers did not have access to modern animal husbandry, fodder cultivation and dairy
practices. This restricted the development of the rural economy. Resulting from the
partnership between Nestlé and farmers, new progressive dairy farming techniques have
led to an increased efficiency in farming and helped to improve the welfare of livestock.

Nestlé Milkpak helped to establish an Extension Service, staffed by qualified veterinary

surgeons. They have provided free consultation on diagnosis and treatment, undertaken
vaccination at cost and held lectures on measures to enhance the quality and quantity of
milk. Last year 130,000 animals were vaccinated to prevent the spread of HS disease
during the rainy season, 80,000 were treated for routine diseases and a de-worming
campaign treated 85,000 livestock.

The Extension Service has played a key role in encouraging farmers to establish co-
operative programs to improve the breeding quality of livestock. So far, the results, using
artificial insemination and other methods, have been successful and more farmers are
joining the scheme.

Animal nutrition had been another area suffering from under-development. Now, farmers
are given advice on how to use cotton seed cake and molasses as feeding supplements.
Independently it would be difficult for farmers to buy these products; however Nestlé
Milkpak imports high yield seeds, cuttings of fodder crops and bulk quantities of sugar
and sell them to farmers at cost. The Extension Service is helping to educate and
encourage farmers to utilize waste corn to make silage.

Conclusion

Thus the partnership between Nestlé and the dairy farmers in the Punjab region has
produced positive results as hoped. There has been a significant improvement in both
quality and quantity of milk, generating growth of the economy and therefore raising the
standard of living of Pakistani dairy farmers.

Service Quality of Nestle Milkpak

Along with quality product Nestle Milkpak also provide Quality Service to its Customers.
The availability of the product in every part of the country became possible only due to
the Quality of service provided by Nestle Milkpak. They also tale care and make sure that
the product is preserved in a perfect way for the customers. Nestle milkpak also listen to
the complaints of the customers regarding the service provided by them. For this purpose
their customers can contact them directly or even through their distribution channels. The
customers are also provided with the facility to contact them online if they are there with
any sort of complaints regarding the service provided by them.

Total Quality Management in Nestle Milkpak

TQM is an Organization-wide approach to continuously improving the quality of all the
organization’s processes, products, and services. Nestle Milkpak spend millions of its
income on continuously improvement of the organization’s processes, products, and
services. For this purpose Nestle milkpak conduct monthly meetings on which they
discuss all most all important issues regarding the product also strategies are developed
regarding continuous improvements. Nestle Milkpak bring varieties and variations in its
products to retain their customers in a better way than their competitors. Especially in
case of any complaints from the customers quick actions are taken to over come the weak
Point and top make their customers happy. Suggestions from customers regarding
improvements in the product are always appreciated by the company.
Maximizing Customers Lifetime Value

Nestle Milkpak also give its best output in maximizing its customers lifetime value. For
this purpose although Nestle is not going to fire its customers with low profit but at the
same time they prefer to concentrate more towards its more profitable customers. The
customers of middle, upper middle and upper class are more profitable for Nestle
Milkpak but at the same time Nestle is not going to ignore lower middle class. They have
a concept that these customers of lower middle can move up to middle class and can
become profitable customers for them.

Customer Profitability

Nestle have many profitable customers that over time yields a revenue stream. Through
Customer Profitability Analysis Nestle Milkpak came to know that its most profitable
customers are different companies who prefer quality milk for their employees, hotel ling
and restaurant industry, people middle and high income are the profitable customers of
Nestle Milkpak. They concentrate seriously on retaining their profitable customers.
Nestle Milkpak gives their best output to change their customers into loyal customers by
providing them exactly what they need and also according to their need.
A NALYZING
CONSUMER MARKET
Consumer Behavior
Consumers do not make their decisions in a vacuum. Their purchases are highly
influenced by cultural social, personal, and psychological factors. For the most part, they
are “non controllable” by the marketer but must be taken in to account that is why Nestle
Milkpak examine the influence of each factor on a buyer’s behavior. Nestle Milkpak is
very well aware of the importance of consumer behavior towards buying the products.
They know that Consumer behaviour is the study of how people buy, what they buy,
when they buy and why they buy. It is a subcategory of marketing that blends elements
from psychology, sociology, sociopsychology, anthropology and economics. It attempts
to understand the buyer decision making process, both individually and in groups. It
studies characteristics of individual consumers such as demographics, psychographics,
and behavioural variables in an attempt to understand people's wants. It also tries to
assess influences on the consumer from groups such as family, friends, reference groups
and society in general.

Factors that Effect Consumer Behavior

A consumer’s buying behaviour of the customers of Nestle Milkpak is influenced by
Cultural, Social, and Personal factors:

Cultural Factors

Cultural factors have a significant impact on customer behavior. Culture is the most basic
cause of a person’s wants and behavior. Growing up, children learn basic values,
perception and wants from the family and other important groups.

Nestle Milkpak always keep in mind the importance of cultural factors. Even the packing,
taste, Ingredients and availability of the product is finalized by keeping the cultural
factors in view. Even before launching any new product a research is always conducted to
know about the cultural factors regarding the product.

Apart from cultural factors Nestle Milkpak also divides its customers on the basis of
Subculture factors:

Subculture

People with different nationalities also prefer to use Nestle Milkpak because of its best
quality. Majority of Pakistani national mostly prefer to use milkpak because it’s more
expedient to use and also full of useful ingredients and also because of the ideal quality
provided to them. Customers who are not Pakistani nationality holders but who live in
Pakistan use nestle because nestle is serving its customers globally.
Nestle also perfectly suits its customers belonging to different religions. Nestle Milkpak
brings variations in its products by keeping in view the different religious perspectives of
its customers in view. Nestle Milkpak also divides its customers on geographical basis to
possibly come to know about their requirements and needs and to best serve them.

Not only the products but also the advertisement and marketing of nestle Milkpak is
designed by keeping in view the cultural and also the subculture factors in view. The ads
of the product are changed from country to country.

Social Classes

Nestle Milkpak is aware of the importance of social class in the success of the product.
Social class is an open group of individuals who have similar social rank. Social class
influences many aspects of human life. Virtually all human societies exhibit social
stratification. Stratification sometimes takes the form of a caste system where the
members of different caste are reared for certain roles and cannot change their caste
membership .More frequently; stratification takes the form of social classes.

The main part of the income of Nestle Milkpak is generated from the social classes which
include Upper Lowers class which are not impressive source of income for Nestle
Milkpak but they are never ignored by Nestle Milkpak. A 10 ml pack is specially
designed by keeping in view the requirements of upper lower class in view. The Working
Class is also engendering some sort of income for Nestle Milkpak. Although the working
class it is not very extraordinary but it again never ignored by Nestle Milkpak. The upper
lowers and the working class are price conscious that is why nestle provide them 10 ml
pack with affordable price. The Middle class also importance as the people of this level
participate actively in the sales of Nestle Milkpak. The upper middle class contribute
towards the success of Nestle Milkpak and this category is never ignored or treated
ordinarily by Nestle Milkpak. The upper uppers class customers are thought to be Golden
Customers as they generate most of the revenue for Nestle Milkpak. as the customers of
upper uppers class are quality and status conscious they never compromise on quality and
for that they even pay more and wants to have perfect quality that is why the prefer to
have Nestle Milkpak. The ½ and 1 kilo Nestle Milkpak is specially designed by keeping
in view nature is requirements of the customer of middle and upper middle class.

Personal Factors

A consumer’s behavior is also influenced by social factors, such as the consumer’s

reference group, family, and social roles and statuses that is reason why Nestle Milkpak
never ignore these factors.

Reference Groups

A person’s reference groups are those groups that have a direct (face to face) or indirect
influence on the person’s attitudes or behavior. Nestle Milkpak has great image on the
minds of their customers the is why the Membership group that ahs direct influence on
the others have positive perception about Nestle Milkpak and that is the reason that it is
quite successful among its customers. Then the primary groups where the people belong
to each other and interact with each other also contribute positively towards Nestle
Milkpak. During daily interactions the positive points of Nestle Milkpak that are shared
by Primary groups with each other also enhance and improve the image as well as the
profitability of Nestle Milkpak.

Family

Members of the buyer’s family can exercise a strong influence on the buyer’s behavior.
The families with extremely Islamic religious concept have not that much positive
concept about those companies which are headed over by foreign non Islamic countries
and as Nestle Milkpak is headed by Foreign Multinational Company that is why it is not
positively appreciated by them. Also the off springs of such religious leaders give birth to
such concepts about foreign multinational companies like Nestle. On the other hand the
members of modern Families with less rigid Islamic concepts have positive remarks
about the Multinational Companies like Nestle.

Husband and wife play a vital role in deciding about the products. In case of expensive
products and services, husband and wives engage in more joint decision making. Nestle
conducted Market survey through they come to know that which member normally has
the greater influence in the purchase of a particular products or services. Either the
husband or the wife, or they have equal influence. Through research they come to known
that in case of kitchen expenses the wives play major role and through the same survey
they come to know that most of the house wives who have control over the kitchen
expenses have positive remarks about the products and services provided by Nestle.

Personal Factors

Most of the times the buyers ‘decisions are influenced by personal factors.

Age

Nestle Milkpak is used by its customers from all age of groups because of the fact that
Nestle Milkpak contain all the beneficial ingredients that are perfect for good health.

Life Cycle Stage

The consumptions of Nestle Milkpak are also shaped by the family life cycle the number
of people in home at a time. To capture the attention of all the families members nestle
always bring variation in its products like Nestle Milkpak is available which is thought to
be perfect for tea making purpose and also for drinking purpose, Nestle Everyday is
available in liquid as well as on the form of dry milk, Milo is available delicious taste
designed specially by keeping the kids needs in mind and many other products are
presented by Nestle to provide all the family members what ever they need.
Occupation and Economic Circumstances

Occupations and economic circumstances also influence the consumption pattern of

nestle Milkpak. The blue collar workers prefer to buy the milk which is openly
distributed by the milkman and which is thought to be cheap. The blue collar workers
have to survive in and also to look after their family in a condition where the things of
even daily use are expensive all around that is why they prefer to have milk in cheap
price from the milkman rather than MilkPak.

Product selection is also effected by the economic circumstances. Customers who are
economically stable and who have strong purchasing power are thought to be the favored
most priceless customers of Nestle Milkpak.

The marketers of Nestle Milkpak try to identify the occupational groups that have above
– average interest in their product and services and also it is their utmost priority to have
more and more economically stable customers and on the other hand the customers with
middle income are never overlooked by Nestle Milkpak.

Personality and self concept

Personality and self concept are a set of distinguishing psychological traits. Customer
many times wants to buy such products whose personalities match their own. Most of the
customers of Nestle Milkpak, who are status conscious, quality conscious, want to be
dominant over others and economically stable, are not going to have milk from milkman
or they are not going to compromise over the price or quality that is the reason why they
always like better to have Nestle Milkpak.

Lifestyles and Values

As the world has become Global village developments are at the peak at the same time
people prefer to have products which are easily available, less time consuming and
obviously which contain all the desired qualities. In case of milk now days the working
and the cooperate class don’t have that much time to have openly distributed milk from
milkman and to boil that milk and also with boiling the milk the useful ingredients are
going to be smashed that is why they prefer to have Nestle Milkpak which provides
expediency in usage and also provides ideal quality.

Stages of the Consumer Buying Process

There are six stages in consumer buying process but Actual purchasing is only one stage
of the process. Not all decision processes lead to a purchase. The six stages are:
Problem Recognition (awareness of need)

Nestle Milkpak creates awareness about the need to have safe, pure and quality milk
through many ways. Many times the role to create awareness is played with the help of
advertisement. Nestle before launching Nestle Milkpak realized the customers of nestle
who are using their quality products feel the need to have also the quality milk with
useful ingredients along with the perfect quality. After recognizing the problem Nestle
Milkpak was brought to the market among the customers.

Information Search

When Nestle Milkpak was launched although Nestle was having positive perception in
the minds of the customers but even then for their satisfaction they come to know about
the product through different sources like the advertisement, public sources and also
through viral marketing where other customers were also attracted by the words of mouth
of the loyal customers of Nestle. Many customers after coming to know about the perfect
performance of Nestle and the launch of their milkpak they used it on experimental basis
and found it flawlessly according to their taste because before launching Nestle Milkpak
a complete research was done and it was find out that there is really a need also to
provide the customers with variation in the products in the form of Nestle Milkpak.

Evaluation of Alternatives

By keeping in view the requirements of the customers Nestle Milkpak was provided with
different attributes and benefits to attract and retain the customers. Nestle provides its
customers with what ever the best they can provide them with and as a result they
remained successful a positive belief and attitude in the minds of the customers about the
customers.

Evaluation of Alternatives
Purchase decision

Nestle is well aware that milk is used on daily basis and also the customers purchased it
on daily basis. To fulfill the requirement of purchase on daily basis Nestle Milkpak is
produced on large quantity and through contracts with devoted distributors it is made
available in all most all important cities of the countries from where the customer can
easily purchase it.

Post-Purchase Evaluation

After launching Nestle Milkpak, Nestle got positive response from the customers. The
customers were found perfectly satisfied with the product. Few months after the launch of
Nestle Milkpak a survey was conducted by Nestle to test out the response of the
customers regarding Nestle Milkpak. The result was astounding/majority of the
customers were found satisfied with the purity and quality of the product. It was because
of the positive perception of the Nestle among its customers as Nestle is serving its
customers globally from past many years.
A NALYSING
BUSINESS MARKET
Organizational Buying in Nestle Milkpak
Nestle felt the need to purchase packets for the packing of the its milk for this purpose
they made an agreement with Tetra Pak. Now Tetra Pak is providing Nestle Milkpak with
the packs for the packing of their milk. Nestle Milkpak purchase material for the packing
of its Milkpak in bulk from Tetra Pak. On the other hand they also collect milk from
different farmers and after the production of the product Nestle Milkpak is made
available for the customers in the market through different distributors of Nestle Milkpak.

Business Market of Nestle Milkpak

The business market of Nestle Milkpak is serving its customers with the best output.
Some of the characteristics of Nestle Milkpak are as following:

Fewer but Larger Buyers

Nestle Milkpak have fewer larger buyers who make purchases from Nestle Milkpak in
bulk and make that available for the customers of Nestle Milkpak. Nestle Milkpak had 26
Distribution channels in three different Zones of Pakistan.

Professional Purchasing

Nestle Milkpak made professional purchasing through professionally trained purchasing

agents. Those professionally trained purchasing agents are supposed to follow Nestlé’s
purchasing policies, constrains and requirements.

Inelastic Demand

The utmost priority of Nestle Milkpak to make its product available for its customer and
also to build brand loyal customer relationship. The demand for nestle Milkpak is
inelastic in a way that the purchasing of nestle Milkpak is not going to be influenced by
price changes because of the fact that most of the customers of nestle Milkpak are quality
conscious rather then price conscious.

Buying Situations in Nestle Milkpak

In many decisions in making purchases for the packing of this product the main buying
situation that nestle Milkpak adopts is modified re-buy where specifications are brought
to the product.

Modified Re-buy
Nestle Milkpak get their milk from different farms, they don’t compromise on the quality
of the product, and sometimes it need modification and in case of any bad quality they
inform their supplier to maintain the quality of the product, and some time they switch
the suppliers due to non-reliable supply of the product..

System Selling
Nestle Milk have fewer distributors in the Pakistan they sell their product tot hem in mass
amount.

Gold standard customers

Customers of Nestle Milkpak just expect the great quality, assistance, reliable delivery of
the product. They just want to follow the standard. Nestle Milkpak have taken suitable
steps to made a impression on the mind of their customers that Nestle Milkpak is
providing best milk in the market.

Supply Chain Management Orientation

Supply chain of Nestle Milkpak has more strategic and value adding operations. They
have built the long term relationships with their suppliers in terms of good quality and
reliability.

Stages in the Buying Process

Problem Recognition

Nestle Milkpak always try to provide better quality product to their customers. Incase of
finding any problem in the manufacturing or supplying of the product, they take suitable
to steps to remove that problem, Nestle Milkpak get milk from the farms which are away
from the city, so there are sometimes problem in the delivery process, because they have
to keep the milk fresh and effective.

General Need Description and Product Specification

All departments of Nestle Milkpak coordinate to get out of the problem, they try to keep
the reliability and durability of the product.

Suppliers Search

In finding any problem in the product and delivery of the product, Nestle milkpak go for
the other supplier and convenient delivery process, they contact with the different
companies who are providing better delivery process, and a suppliers who provide the
product with better quality.
Problem Solicitation

After that process Nestle Milkpak look for the qualified suppliers to submit their
proposals, proposal covers the every thing which must be included in process, then Nestle
Milkpak ask for the some selected suppliers and distributors to give brief presentations on
the what the can provide to us.

Supplier Selection

After getting the proposals Nestle Milkpak go for the of best of best of the suppliers and
distributors among all, they study from all the dimensions to select the best supplier.

Order-Routine Specification

When the best supplier and distributor is selected, the Nestle Milkpak find out that in how
much quantity they need the supply, and how conveniently it will reach to the company,
and how much time it will take.

Performance Review

The most important thing is the performance of the supplier and distributor, that how they
are maintaining their level of production and delivery, to maintain the process without
any hurdles. Nestle Milkpak uses the evaluation system to analyze the performance of the
producer and supplier.
M ARKET SEGMENTS
AND TARGETS
Local Marketing
The local marketing of Nestle Milkpak varies from city to city. Their plan their marketing
and promotional activities are designed according to the area and their marketing
strategies for a particular area are also formed by analyzing the market of that area.

Customization
Customization does not directly implements on Nestle Milkpak. As Milkpak is the first
milk Product of Nestle and customization is done by bringing other products like Nesvita,
Nido, Everyday etc. Nestle Milkpak is a customized product.

Segmenting Consumer Market

Nestle has segmented its market in different ways

Geographical Segmentation

The marketing activities of Nestle Milkpak are based on the areas. Geographically nestle
has divided the region Pakistan into three zones.

1. North Zone
2. Central Zone
3. South Zone
These zones are further divided into different regions then these regions are sub divided
into different areas. The sub division of area is called a territory an then these territories
are further divided into cities.

Demographic Segmentation
Demographically nestle Milkpak has divided the target market into different groups.
These are as follows:

Age and Life Cycle Stage

Milk is the basic necessity of all human beings indifferent of being at any stage in life.
Nestle Milkpak has focused on the age and life stage of people by bringing other products
like Nido for children, Nesvita for health conscious people etc.

Income

The income level is also very important in case of Nestle Milkpak because there is also
open milk available in the market. The people with sufficient income are quality and
health conscious and these are the people are the actual customers of Nestle Milkpak.
Generation

The new generation is well aware and well informed about the good and bad aspects of a
product then the previous people. The new generation prefers Milkpak due to its valuable
features like quality, durability, and packaging.

Social classes

The society of Pakistan has been divided into different social classes and this distribution
is actually based on the income level of people. Nestle milk pack is targeting the middle,
upper middle and lower high class of the society.

Behavioral Segmentation
Nestle MilkPak has also segmented its target market on the basis of human behavior. It is
as follows:

Decision Poles

Nestle MilkPak mainly focuses on the house wives because they are the decision makers
who decide what to us in the kitchen in order to ensure the health of the whole family.
This is also shown in their advertisements.

Behavioral Variables
Occasions

Human behavior and consumption patterns change on different occasions like the milk
consumption increases on different festivals e.g. Eid-ul-Fiter. For this different marketing
campaigns are designed by the company and also different strategies are developed like
discounts etc in order to make the customers feel that the company is concerned about its
customers.

Benefits

Nestle Milkpak offers different types of benefits to its target customers. These are:
• Quality
• Durability
• Packaging
• Availability
• Reasonable Price

User status
User status also plays a role in his behavior. The high class user prefers using the family
pack while the low class user goes for the small pack.

Usage Rate

Nestle Milkpak also ranks different areas on the basis of usage rate. These high and low
sale areas also tell about the consumption patterns and behavior of the population of those
areas towards Nestle Milkpak.

Buyer readiness stage

Nestle is continuously playing a very important role in creating awareness about its
product Nestle Milkpak. This creation of awareness helps a company to get a better and
positive response from the target customers. Nestle has a department named a Consumer
Relation Department and the job of this department is to create awareness between the
people. This is the reason that the market share of Nestle Milkpak is increasing day by
day and now it has become the market leader.

Loyalty Status

Major portion of Nestle Milkpak’s customers are those who are hard core loyal. These are
the people who never compromise on quality. That is why Milkpak is the strongest milk
brand available in the market. The competitors are trying very hard but they have only 13
to 15 percent of the total market share.

Attitude

Nestle Milkpak has to face two types of attitudes positive and negative. The people with
the positive attitude prefer Nestle Milkpak due to its different features and these are also
quality conscious.

Sequential Segmentation
Sequential segmentation in case of Nestle Milkpak is as follows

First Time Prospects

Nestle Milkpak’s market share is growing day by day and this means that there are a lot
of first time prospects who want quality at a reasonable price.

Novices

Many people are shifting on packed milk from open milk. These are the people who have
risen in their social status and majority of these prefer Nestle.
Sophisticates

Nestle Milkpak’s current consumers of are the sophisticates. Nestle has established strong
relationship with these customers. Nestle gets feedback and responds positively to these
consumers. That is the reason that Nestle is the market leader in milk industry.

Price oriented customers

Nestle also focuses on its customers who are price conscious. In order to target these
customers Nestle MilkPak is Available in different packs in the market.

Solution Oriented Customers

These are the actual customers of nestle Milkpak who never compromise on quality and
Nestle provides them with the best quality as compared to other milk brands available in
the market.

Effective Segmentation criteria

Nestle Milkpak has a very effective criteria for the market segments. Nestle Milkpak has
a very effective and accurate market measurement that to what extent they should
produce their product. The company measures the market potential to sell is product and
Nestle Milkpak is produced accordingly. Nestle Milkpak has the largest and effective
distribution network as compared to its competitors all over Pakistan and Nestle Milkpak
is available all over Pakistan. Nestle Milkpak differs from its competitor brands available
in the market due to its best quality and that is also the competitive edge of Nestle
Milkpak the marketing campaigns on nestle Milkpak are also designed according to the
areas and these campaigns differ from area to area. These marketing campaigns are
actionable and the consumer responses are at a very high rate.

Evaluating and Selecting Market Segments

Nestle Milkpak has evaluated the market of Pakistan and segmentation has been done
accordingly. Nestle Milkpak has specialized in producing the best quality hygienic milk.
Quality is a competitive edge of Nestle Milkpak over its other competitors. Nestle has its
own laboratories in which the milk quality is tested. Nestle has specialized staff for
keeping a check on the quality. Nestle Milkpak has a very strong and largest distribution
network which enables to provide its customers with the best milk. The distribution
network is present all over Pakistan and that is how they are having full market coverage.
Nestle is also having a full market coverage by having other milk products e.g. Nesvita,
Nido etc.
Differentiated Marketing Costs
The prices of all the milk brands available in the market are same. These prices are
regulated and implemented by Pakistan Dairy Association. The company can maximize
its profit only by minimizing its different costs

Product modification cost

There are two types of product modification costs.
• Horizontal product modification cost contains the cost which company bears in
making Nestle Milkpak available in the market in different packs e.g.
C REATING
BRAND EQUITY
Brand Name of Nestle Milkpak
Nestle had a brand name among its customers. Nestle use Birds nest with the parents
caring the small ones which gives out a perception that like in a manner the parent birds
care about their young ones in the same manner Nestle is also concern about their
customers and therefore it is Nestle Milkpak’s utmost priority to provide their customers
with quality milk full of useful ingredients. While thinking of Nestle Milkpak the
perception developed in the minds of the customers is the pure quality milk and that what
Nestle Milkpak is trying to convey them.

Role of the Brand Name of Nestle Milkpak

Legally Protected

The brand name of Nestle Milkpak is legally protected as it is registered trademark

therefore no others companies can copy them. Through registered trademark Nestle
Milkpak’s manufacturing and packing processes are safe.

Organizing Inventory and Account Records

The brand name of Nestle Milkpak is also very helpful in organizing account and
inventory records as they are really necessary to be accurate as they are the main part of
the financial reports of Nestle which finally shows the financial position of the company.

Level of Quality

The Brand name of Nestle had a very positive perception in the minds of their customers
that is why just thinking of Nestle Milkpak the concept arise in the minds of the
customers that it is a quality milk. Nestle Milkpak is well known among its customers for
the quality provided by them.

Builds Customers Loyalty

The brand name of Nestle Milkpak plays its role in converting its customers into Loyal
Customers. Due to the positive image for providing quality service Nestle Milkpak has
more loyal customers who are committed to buy only Nestle Milkpak although there are
many other brands in the market.

Create Barriers for the new entrants

The Brand name of Nestle Milkpak creates barriers for the new entrants into the market
who are serving privileged class. Although new entrants are coming into the market but
they are not that much strengthened to compete with the brand name of Nestle and they
are not able to serve majority of the customers in a way Nestle is serving.

Brand Equity
For Nestle Milkpak its Brand Equity is a set of its assets linked to its brand name and
symbol that adds to the value provided by Nestle Milkpak and the service to its
customers. Nestle Milkpak wants their customers to feel really pleasant about their brand
name that is why they never compromise on the quality of the product as well as the
quality of their services. Nestle Milkpak wants to provide their customers with what ever
they expects regarding the product and also they want to have their customers to have
positive and attractive experience while using Nestle Milkpak.

The Customer Based Brand Equity of Nestle Milkpak is very strong as they respond
positively towards the marketing of the Nestle Milkpak. Nestle try its best to market
Nestle Milkpak in a more attractive way so that their customers remember them forever.
Nestle Milkpak creates Positive brand equity by effective promotion and consistently
meeting and many times exceeding their customers thoughts and expectations and also
the profitability of Nestle Milkpak is high because of the greater brand equity.

Components of Nestle Milkpak’s Brand Equity

There are four main pillars of Nestle Milkpak’s brand equity which play vital role in its
success.

Differentiation

Nestle Milkpak differentiated by its customers from the other brands on the basis of the
quality provided and the purity of the products. Their customers are quite satisfied that
for what ever they are paying is according to their requirement and taste.

Relevance

Nestle Milkpak has great significance among its customers. The customers are well aware
of the importance of Nestle Milkpak in their as Nestle Milkpak is full of taste and
calcium and that is why their customers always prefer to have Nestle Milkpak.

Esteem
Nestle has super esteem among its customers and also Nestle is respected by its
customers as they always found Nestle as caring towards them and same is the reason that
all most all Nestle products are appreciated by its customers.

Knowledge
Customers have appreciable knowledge about Nestle Milkpak they are well aware of the
attributes of the product. The customers have complete knowledge about the product.

Brand Elements of Nestle Milkpak

When nestle Milkpak deal with brand elements they talk about:

Symbol and Character

Also the Nestle Milkpak’s two kids with their father showing strong muscles exist for
quite some times now. It is the symbol of the beneficial ingredients that Nestle Milkpak
contains.

Packing

The packing of Nestle Milkpak is in a thick cover with almost four layers to protect the
milk from climatic changes. The coloring of the packing of Nestle Milkpak is light green
and white.

Slogan

The slogan used by Nestle Milkpak is of Urdu wordings as of is the National Language of
Pakistan. The slogan is “Jaan Banao”

Criteria for choosing Brand Elements

There are five criteria of Nestle Milkpak to judge whether or not the above mentioned are
good brand elements

Memorable

The Memorable of Nestle Milkpak is high thanks to the name, graphic profile, father with
his kids showing brand loyalty and the light green and yellow box. Also a little survey
was conducted among 62 people. Question was asked concerning brand recall and
recognition. This way the memorable of Nestle Milkpak could be defined as high.

Meaningful

The name of Nestle Milkpak is rather Meaningful because as the name represents that it
is the quality product of Nestle so Nestle Milkpak is a good term to identify the product
with.

Transferability
Also the transferability of this product is high. This became clear after Nestlé did some
brand extensions. Nowadays there are breakfast’s cereals, syrups for pancakes, dry milk
all under the name of nestle.

Adaptability

The logo is very flexible over time. They are used for several years already and today it
does not look old-fashioned at all. So in this manner the adaptability of Nestle Milkpak is
good as well.

Predictability

Nestle Milkpak is a protected, registered trademark. Predictability is the fifth criteria.

We can conclude that all criteria’s are fulfilled and that the brand elements of Nestle
Milkpak are well chosen and also well designed.

Brand Portfolio Nestle

Nestlé has a rather extensive brand portfolio. We divided the more than 130 products into
9 groups and several groups are divided into subcategories, as you can see in the scheme
of the brand portfolio.

• Diary products
• Breakfast Cereals
• Ice Cream
• Chocolate confectionary
• Prepared foods
• Beverages
• Pet care
• Nutrition
• Foodservices

Nestlé is associated with L’Oreal, has a joint venture with Gel derma and Laboratories
Innerve. They also work together with Alcom, a pharmaceutical company.

Brand Strategy
It’s very clear that Nestlé is using a corporate endorsement strategy. They even have a
long tradition in endorsing their brands. Nestlé has gathered several products under a
global umbrella. This is saving costs for Nestlé in campaigning, but it is also reassuring
for the client when they know that one product they like is related to a product they don’t
know yet, but which they want to try out. They know the good quality the product
represents.
Recently Nestlé started with the line extensions. For example, along with Nestle Milkpak
they also come up with Nestle Everyday, Nido and many others. To optimize the brand
architecture Nestle would also use endorsement as well because this strategy seems to
work for Nestlé. It is easier to cross national boundaries and to introduce products in
countries where only a few products of Nestlé are known. It has an integrative power.
The product line of Nestlé is not too diverse. All their products are related to food, so it is
not likely to end in a dilution of image. Negative associations are the down side of this
strategy, but we think that the effect will be minimal since Nestlé always makes product
campaigns and no corporate campaigns.

Leverage of Secondary Association

The brand can be linked to some other aspects like:

• the company
• the country of origin
• the channel of distribution
• other brands
• an end-user
• an event

The consumer expects that the associations will also characterize the brand so that
characteristics are transferred.

In its marketing Nestlé uses the company name, and so other brands. The company name
Nestlé is both used on Nestle Milkpak and on all its other products. This way costumer
associates the quality of other products of Nestlé to the quality of Nestle Milkpak.

Also the two kids with their father are used as an endorser. They are their spokesperson.
When costumers see their attractive pose showing strong muscles, they immediately think
of Nestlé.

Marketing Programs
The way the brand is integrated into the supporting marketing mix depends on

• product design
• pricing strategies
• channel strategies, which includes distribution and communication

The logo and the light green and white box are the most important element for the
product design. The two children with their parents are the spokesperson of Nestle
Milkpak Nestle tries to get functional and symbolic benefits, such as recognition. As a
symbol they use the kids with their father, this also gives them benefits.

Nestlé sets the price based on value based pricing, which means that it uses several
standards to define the price like product design, product costs, and delivery. Its prices
hardly change. But once in a while they grant discounts.
Nestlé uses a push strategy. They push their message through the distribution channels.
The customer does not have to ask for information; there is an intensive distribution
through television, magazines, stores, Internet.

When it comes to the communication channels, Nestlé uses many of them. There are the
commercials on television and in magazines. They are directed to children. CD-ROMs
with games and movies are also used. The website must be considered as a relation
builder advertisement. It is filled with games and other things to entertain for both
children and their parents.

We see their marketing communication approach as an integrated one. The print

advertising always shows a kid playing, skating…, which refers to the energy it needs.
During the TV-commercials, Quickie helps some kids out by letting them drink Nestle
Milkpak so that they are able to have strong muscles and gain energy

Possible Outcomes for Nestle Milkpak

There are several possible benefits for Nestlé by using all these strategies. Some
examples are:

• The benefits that are related to the growth of the product and the profitability. For
example they create loyalty with their customers and are less venerable to
competitive marketing actions because once they get the loyalty of the public; it is
rather easy to keep it.

• More public and higher selling rates make it easier to respond to pricing and
market differences.

• A strong brand also makes it possible to do some line extension. Nestle Milkpak
introduced Nestle Everyday, Nido and many other products.

Measuring Brand Equity

To measure Brand Equity is an important factor for Nestle Milkpak. They fully
concentrate on measuring Brand Equity to really come to know the interest of the
customers about the product.

Brand Audit

In determining the strengths and weaknesses of the brand of Nestle Milkpak brand, or to
cover all the bases when establishing a new brand, the brand audit checklist of Nestle
Milkpak prove of value. In Brand Audit of Nestle Milkpak all most all aspects regarding
Nestle Milkpak are kept in mind and all features related to Nestle Milkpak are very well
designed that is also the main source of attraction of the product towards the customers.
The brand audits of Nestle Milkpak almost require keeping in notice that what products
and services are currently being offered to their precious customers. By keeping their
customers perception in view Nestle Milkpak Nestle always tries to uncover the true
meaning of the brand name and the product of Nestle Milkpak to their customers.

The brand audit of Nestle Milkpak consist of two steps which are first is the Brand
Inventory which provide Nestle with a current, comprehensive profile that how Nestle
Milkpak is sold. Marketed and branded. The marketing of Nestle Milkpak is well and
perfectly designed by keeping all factors in view in both visual and verbal form and that
is the reason that Words of Mouth play a vital role in the success of the product. Secondly
brand Exploratory which is conducting research activities for Nestle Milkpak to know
about the perception of the customers who are their customers and also to find out about
the perception of those who are not their customers to know about that what are their
requirements and how that can be fulfilled to attract them towards Nestle Milkpak. Brand
Exploratory also tries to find out that what the impact of marketing on their customers is.
After evaluating the research necessary steps are taken to overcome the weak points.

Brand Tracking

Brand tracking is also apart of the measuring brand equity of nestle MilkPak. Marketers
of Nestle MilkPak are provided with current information’s regarding the product that how
the product is performing and how it is competing with rivals in the market and also they
are told about that how they can enhance the brand equity.

The provided information’s regarding Nestle Milkpak is quite helpful for the managers of
nestle milkpak to make day to day decisions effectively and also only because of the
positive impact of the provided information’s Nestle Milkpak is performing beyond the
expectations of the customers.

Brand Valuation

Nestle has base their growth on acquiring and building rich brand portfolio and for the
same purpose they have acquired Rowntree (U.K), Carnation ( U.S), Stouffer ( U.S),
Buitoni-Perugina ( Italy) and Perrier (France) making its self world’s largest food
company.

In Pakistan after the counter attack by Olpers to attract their farmers who were providing
them with the milk Nestle Millpak had decided to set up their own farm house to continue
serving their customers with quality milkpak and for the same purpose they are about to
import thirty thousand Australians cows from Australia on initial stage.

Managing Brand Equity of Nestle Milkpak

The effective Brand Equity Managing is the main source of its success among its
customers. For managing the Brand Equity the marketing of Nestle Milkpak play a vital
role. The managing of Nestle Milkpak consists of Brand Reinforcement, Brand
Brand Reinforcement

Nestle Milkpak is well managed by the devoted staff of Nestle and same is the reason of
its achievements. It is carefully observed by Nestle Milkpak that what does the Brand of
Nestle Milkpak represents towards its customers. Brand reinforcement of Nestle Milkpak
also bring innovations to the product with the passage of time to maintain its positive
image towards its customers and for this purpose the marketing programs of nestle
Milkpak play a vital role.

Brand Revitalization

The changes in the Consumers, emergence of new competitors like Olpers and the
counter attract by the rivals were thought to be the potentially effect the fortune of the s
of the brand of Nestle Milkpak but Nestle Milkpak had very well managed all the
situations. Nestle Milkpak always brought innovations to the Product with the change in
the taste of the consumers, also the have very well managed he counter attacks by the
main rivals lime Olpers and Haleeb and also Nestle Milkpak had very well managed the
emergence of the new competitors.

Brand Crisis

Nestle Milkpak had never been in any serious Brand Crisis. Whenever crisis had been
arising Nestle Milkpak had very well managed that. Some difficult situations were
created by Olpers by attracting the main farmers by offering them free fertilizers as
Olpers is the product of Engro Chemicals but nestle had very well managed that situation
and had decided to set up their own farm house.

Devising a Brand Strategy of Nestle Milkpak

Nestle Milkpak is managing its Brand Strategy in a very well manner as it is the main
force behind its success.

Brand Extension

An established and impressive brand of Nestle is used to introduce other hundreds of

brands. The new introduced products of Nestle Milkpak are quite successful among its
customers because of the impressive image of nestle among its customers. The brand
extension of Nestle consists of more than 130 products into 9 groups and several groups
are divided into subcategories, as you can see in the scheme of the brand portfolio.

• Diary products
• Breakfast Cereals
• Ice Cream
• Chocolate confectionary
• Prepared foods
 • Beverages
• Pet care
• Nutrition
• Foodservices

Parent Brand

Nestle is the Parent brand which give birth to Brand Extension under which hundreds of
products have been introduced in the market.

Family Brand

The family brand of Nestle is consisting of hundreds of different products in different

categories. There is almost all kind of food products in the family brand of Nestle.

Line Extension

The brand name of Nestle is always used to develop and introduce new product among
the customers and also the brand name of Nestle is used to attract and serve the target
customers.

Category Extension

The Brand name of Nestle entered in all categories of Nestle products and further
introduced many other products in each category of nestle. Nestle is further extending its
all categories and always brought variations in the products.

Brand Mix

Nestlé’s brand mix is quite inspiring towards its customers as they are provided with
almost all kinds of food items under the particular brand of Nestle.

Branded Variants

Nestlé’s products of different category are made available thorough different distribution
Channels and retailers.

Licensed Products

All the products of Nestle are licensed products to avoid the danger of copying the
product by the competitors.
C RAFTING &
BRAND POSITIONING
Positioning of Nestle Milkpak
The designing of the offering of Nestle Milkpak and the image of Nestle Milkpak is very
striking among its customers as Nestle Milkpak is providing its customers with quality
milk. Nestle Milkpa is concuous and careful about that how potential buyers see the
product. positioning of Nestle Milkpak has come to mean the process by which marketers
try to create an image or identity about Nestle Milkpak in the minds of their target market
for product, brand, and organization of Nestle. It is the relative competitive
comparison'their product occupies in a given market as perceived by the target market.
Nestle Milkpak has great image among its customers regarding its competitors. Nestle
Milkpak always use its possible best resources to creat clear and impressive image in the
minds of its customers for their purpose they have never compromised on the quality of
the product.

Positioning Concept of Nestle Milkpak

More generally there are two types of Nestle Milkpak’s positioning concepts

Functional Positions

In functional positioning the problems regarding Nestle Milkpak are always quickly
solved like in a manner the problem regarding the supply of milkpak was quickly
solvewd by establishing their own farm house. Benefits are also provided under Funtional
Positioning by providing the customers with the health benefits by providing them with
useful ingredients. Also discount benefits are given to the customers on special occasions
like Eid and Ramadan.

Symbolic Positions

Under Symbolic Enhancement the self image of Nestle Milkpak is enhanced among its
customers and also among its competitors. The main purpose of the product are also very
effectively fullfilled.

Points of Parity ( POPS) of Nestle Milkpak

There are many associations of Nestle Milkapk which are not very unique as Milk is also
provided by many othe campanies in the market and almost same as the rivals are
offering. Also the pakaging is almost same as the competitors are offering.

Point of Differentiation ( PODS) of Nestle Milkpak

Although there are some associations of Nestle Milkpak which are not very unique
towards its customer but at the same time thee are many points of Difference which make
it siccessfulamong its customers.
Relevence

The target customers of Nestle Milkapk had always found it Relevent and important. As
Nestle convey the main message that they are going to provide their customers with
quality products it is very imporatnt towards its customers.

Distinctivness

The targe customers of Nestle Milkpak had always found it Distinctive and superior as
the product is designed according to their taste and need. Taget customers had found
Nestle Milkpak superior as Nestle is always bringing innovations to the products
according to the requirements of the customers.

Deliveribility Criteria of Nestle Milkpak

The Deliveribility criteria of Nestle Milkpak is also very important for Nestle Milkpa to
position its self in a very well manner in the minds of its target customers.

Feasibility

The product design and marketing offerings of Nestle Milkpak are very supportive
towards the prods to create Points of Difference. The marketing and designing strategy of
Nestle Milkpak are also changed with the changes in the product to convince the target
customers regarding the changes

Sustainability

The sustaimability of Nestle Milkpak is also strong because of the great internal
commitment and also because of the very well managing of availible resources. The
impressive performance of the products is helpful is maintaining sustaimnability and
ofcourse also in maintaining PODS.

Differentiation Strategies of Nestle MilkPak

The differentiation Strategies of Nestle MilkPak are also important because of the fact
that Netle Milkpak want to creat PODS among its competitorsand customers

Product Differentiation

Nestle Milkpak want to create Product Differentiation on the basis of its features, design,
performance, conformance, reliability and quality. Nestle Milkpak make product
differentiation by providing its customers with quality product. Nestle is well known
among its customers because of the quality provided by them. Nestle had never been
found while compromising on Quality of the products and that is the reason of its
popularity among its target customers. Although milk is also provide by other rivals of
Nestle Milkpak but the Quality that Nestle Milkpak is providing is its competitive edge
over other competitors

Personnel Differentiation

Nestle also had competitive edge over its competitors by having very ell trained people.
Even training is provided to the farmers about the introduction of latest technology to
increase milk production who are providing Nestle Milkpak with milkpak. The staffs of
Nestlé Milkpak are very well mannered, cooperative and devoted.

Channel Differentiation

Nestle Milkpak’s well known among its target customers and competitors by well
designed distribution channel’ Coverage, Expertise and Perfomance. The different
channels of Nestle Milkpak mike it availible in a proper quantity and also they storege of
the product in diferent places are save from the enviromental changes.

Image Differentiation

The image created by Nestle MilkPak in the minds of its Target Customer is very
dashing. Nestle had very positive image in the minds of its target customers due to which
all products of Nestle are appreciated by ita target customers. The omage in the minds of
the target customers of Nestle Milkpak is that it isb a safe and quality product.

Product Life Cycle of Nestle Milkpak

The product life cycle of nestle milkpak is quite interesting as Nestle Milkpak reached its
growth and maturity stage.
Introduction Stage

In the introduction stage it was not the main aim of Nestle Milkpak to earn maximum
profit like other companies. In the initial stage it was the utmost priority of Nestle
Milkpak to create awareness about the products among its customers. The profit in the
introduction stage of Nestle Milkpak was not impressive because lots were spended in the
introduction of Nestle Milkpak to the market and sales of the product was although
satisfactory but was not very high.

Growth Stage

Nestle Milkpak reached its growth stage in a very limited time as the product was well
introduced in the product and aslo Nestle Milkpak was appreciated in a very well manner
because of the past impressive image of nestle among its customers. At the growth stage
Nestle Milkpak gained fantastic profit and established its self in proper manner among its
customers.

Maturity Stage

Now a days Nestle Milkpak is in its Maturity stage after surviving in introduction and
growth stages and Nestle Milkpak is going to spent long time in this phase. In the
maturity stage Nestle Milkpak is having strong competition with its competitors and also
Nestle Milkpak is using variety of media to compete with its competitors and to survive
in the modren world of competition.
D EALING WITH
COMPETITION
Competitive Forces
Threat of Intense Segment Rivalry

“A segment is unattractive if it already contain numerous strong, or aggressive

competitors” as we have analyzed that Nestle Milk Pak is not keep these kind of
segmentation.

Threat of New Entrants

These days Milk Pak facing huge competition and threat from two new brand Olper and
Good Milk, Good milk is as such not too much strong competitor but Opler’s strategy
and market entrance is so strong that why nestle little bit facing problem due to new
entrance.

Threat of Substitute Products

Milk Pak facing this threat recently newly entrance of substitute product named as
Olpers.

Threat of Suppliers Growing Bargaining Power

Increase in price of former supporting product suppliers now providing or demanding

milk at higher rates due this Milk Pak and other brands also working to increase their
prices and this is big threat to loose loyal customers.

Identifying Competitors
Following are the competitors of Nestle
• Olpers
• Haleeb
• Good Milk
• Nurpur
• Nirala
• Sabeen
And lot of other local brands are competing their customers.

Industry Concept of Competition

Pure monopoly: Not Implementing
Oligopoly: Not Implementing
Monopolistic competition: Not Implementing
Pure competition: We can say that now Milk Pak facing pure competition
Market Concept of Competition
“Competitors are companies that satisfy the same customers need”
A list of competitors as mentions above

Analyzing Competitors
Strategies

Almost all milk companies have same strategies to target their customers, but now Olpers
is targeting their target market very aggressively, the are utilizing their Human force to
create strong competition and to approach their customer through every way, like free
sampling, free tasting, etc.

Objectives

Milk Pak have strategy to beat the competitors and to make new customers then retention
of these customers for long term.

Strengths and weaknesses

Milk Pak have following strengths quality, strong brand recognition, strong distribution
system and in weakness we considered that they are over estimating their self and not
spending trade offers as their competitors are doing

Selecting Competitors

Milk Pak just considering Olpers as competitor because Haleeb has swept from market as
it was a great competitor in past, but as now they are planning for future fight, may be in
future Haleeb again be a strong competitor.

Competitive Strategies for Market Leaders

Milk Pak now a market leader because it is keeping major sales share from other packed
milk, as a market leader Milk Pak trying not to provide any gape to their competitor.

Expanding the Total Market

Due to combine efforts of competitors and Milk Pak now a big number of new user they
have introduced other then their existing market. So due to combine efforts Milk user
market is increasing day by day because customer are becoming health conscious.
Defending Market Share
As Olpers and other brand adopted very strong and aggressive approach regarding market
share, but still Milk Pak have existed share of market and also 33% growth in this year.

Premium Performance

Presenting high quality and fresh stock to all over the country and proper follow up of
complaints if in any part of country, any body is facing problem.

Extensive and Efficient Dealership System

One of most strong character of Milk Pak’s market share is their strong dealership
system, which is playing strong role in availability of stock.

Full-Line Strategy

Milk Pak providing all customers facility to avail their products with 4 SKU (small kind
of Unit).

Good Financing

Nestle Milk Pak have a strong financing and company back which is ready to finance up
for all kid of competition. Nestle plan to 100 billion companies in 2014 so we can
imagine their aim to grow.

Other Competitive Strategies

Market-challenger Strategies

“Many market challengers have gained ground or even overtaken the leader”
There was a time when Haleeb was market leader and Milk Pak follower but due its
strong strategy milk swept the Haleeb from market and Milk Pak is market leader.

Choosing a general attack strategy

Almost every strategy can be implemented on different situations.

Frontal Attack

Nestle Milk Pak purely attacking under this strategy to their competitors because Milk
Pak continuously match and observing opponent product, advertising, price and
distribution.
Flank Attack

Some times Milk Pak following it

Encirclement Attack

We can say that some times nestle follow this

Guerrilla Warfare
Not as such directly implemented to Milk Pak

Choosing a Specific Attack Strategy ( error in heading check it agian)

All-most all kind of strategies are implementing in different situation

• Price discount
• Lower price goods
• Value-priced goods and services
• Prestige goods
• Product proliferation
• Product innovation
• Improved services
• Distribution innovation
• Manufacturing-cost reduction
• Intensive advertising promotion
S ETTING BRAND
STRATEGY
Product Characteristics and classifications
“A product is anything that can be offered to a market to satisfy want or needs”
According to this theory Nestle Milk Pak present such product which is accordingly
needs and wants of their customers, durable product, good taste, easy to carry, in different
sizes, prices according to competition, attractive packing etc.

Product levels: the customer value Hierarchy

Potential Product
Augmented
Product
Expected Product
Basic
Product
Core benifit

Core benefit

Core Benefit

• To full fill the Milk need

• source of calcium
• taste
• for sweets etc

Basic Product

Milk UHT
Expected Product

“A set of attributes and conditions buyers normally expect when they purchase this
product”
Milk Pak presenting their products accordingly customers expectation, customer expected
such product which near to nature and pure taste, and customers can carry for long run as
compare fresh milk.

Augmented Product

“Differentiations arises on the basis of product augmentation”

under this heading customer’s expectation get exceed from the limit they demand some
thing separate might be in rates, or might be in taste, might be in product line, so as per
market demand people need such milk which high calcium and low fat, so Milk Pak
introduced Nesvita (High calcium low fat)new brand in milk according to market demand
and gape which create a great differentiation and a meet the extra expectation of Milk Pak
customers.

Potential Product

“New ways to satisfy the customers to satisfy their customers through all ways”
Milk Pak introduced Everyday for such people who like thick milk and specially for tea,
it is competitor of Haleeb who was presenting think milk with the slogan of “Garah Jo
Hay”

Product Classifications
Nestle Milk Pak classified under following basis,

Durability and Tangibility

Nondurable Goods

Milk Pak is non durable product and we are using this product in our daily routine, and
we are purchasing it again and again.

Services

Providing products

Product Differentiation
Forms
Green and white color of Nestle Milkpak packing gives differentiation with other milk
brands.

Features

Average creamed Milk

Performance quality

Milk pack is maintaining and following their quality standard, average creamed milk and
still they presenting and covering market with their quality, and Nestle only and only
presenting quality products and they are not compromising on quality.

Durability

Milk Pak life time is 3 months from the time of production.

Reliability

Most reliable brand in current market

Style

Nestle Milk Pak targeting their customers through their brand and it is unique as compare
to others brands, as Olpers presenting with red color which present full cream milk, and
Haleeb presenting as a low creamed Milk with blue packing, so nestle presenting with
great combination of green and white color packing, with is most emotion catching color
scheme for our nation due to our flag color, so we can say that they are presenting
national brand because they adapt pure brand according to our demand.

Products and Brand relationships

The Product Hierarchy

Need family: Milk pack is need family product.

Product family: Milk pak can satisfy core needs with reasonable effectiveness as high
quality product with pure taste, and durability.
Product class: Have only one class in its brands
Product line: Milk Pak have three product line
• Neslte Milk Pack UHT
• Every Day UHT
• Nesvita (HCLF)

Item: Classified into 4 items on the basis of their prices and on the basis of their sizes
 • 250 ml
• 500 ml
• 1000 ml
• 1500 ml
•

Product system and mixes

Product system

Milk Pak have one products system, which presenting UHT milk all over the country

Product Mixes

Milk product has several product mix.

• Nido
• Every day
• Cerelac
• Lactogen
• Nan
• Etc.

Product Line Analysis

Sales and Profit

Milk Pak is considering a supporting brand for Nestle Milk Pak, and 250 ml have big
share in sales and profit

Core Product

UHT milk

Staples

1000 is a staples product of Milk Pak because it was launched again in 2006 and now its
have a proper response.

Specialties

1500 ml Milk only limited sales and limited target market, and before some time it is was
totally push product but now current era is in favor of this brand coz in large size there is
no competitor for 1500 ml
Convenience items

Milk Pak 250 ml is most recognized brand of Milk Pak and it have huge part from Milk
Pak sales.
 D EVELOPING PRICE
STRATEGY & PROGRAMS
Prices of Nestle Milkpak
Nestle Milkpak tries its level best to fairly price its product. The prices of Nestle Milkpak
are set after very well analyzing all important aspects.

Consumer Psychology and pricing by Nestle Milkpak

The psychology of the customers is kept in mind while pricing by Nestle Milkpak.
Psychology of the customer play a vital role in peruses the customer towards the product.

Preference Prices

In preference pricing the target customers of Nestle Milkpak a consumer retain the price
information in memory and use to interpret and evaluate whenever new prices are
introduced by Nestle Milkpak but at the same time Nestle use the pricing objectives and
bring prices that are easily adopted by the customers.

Price-Quality Interferences

Majority of the target customers agree with the prices of Nestle Milkpak as they use price
s an indicator of Quality. The customers of Nestle Milkpak are satisfied with the prices as
Nestle Milkpak provides them with the quality product also. Most of the target customers
of Nestle Milkpak are found Quality conscious rather than price conscious.

Price Endings

The prices of Nestle Milkpak are always round off number instead of price cues as Nestle
Milkpak believe in providing its customers with quality product rather then offering
discounts or lowering prices. Although some discounts are offered by Nestle Milkpak
being respectful towards special occasions like Eid and Ramadan.

Steps by Nestle Milkpak while setting Prices

While introducing Nestle Milkpak in the market all steps were analyzed by Nestle
Milkpak in a proper manner.

Selecting the Price Objectives

Some of the more common pricing objectives of Nestle Milkpak are:

Maximize Long Term Profit

The objective of nestle Milkpak is to maximize long term profit to survive in the modern
world of competition where Nestle Milkpak is grab by the competitors.

Maximize Short Term Profit

In such situation where Nestle Milkpak wants to maximize their long term profit at the
same time Nestle Milkpak tries to maximize short term profit because of the fact that
without maximizing the short term profit it is difficult to maximize the long term profit.

Increase Sales Volume

Nestle Milkpak also tries to increase its sales volume to very well mange the prices of the
product.

Increase Market Share

With very well managing the prices Nestle also tries to mange and increase its market
shares and as a result Nestle Milkpak remained quite successful in gaining most of the
market shares.

Stabilize Market or Stabilize Market Price

The main objective of Nestle Milkpak to stabilize market price is to keep prices stable in
market place and to compete on non pricing considerations.

Company Growth

Through offering well managed and well analyzed prices Nestle Milkpak’s company
growth is always increasing and also appreciated by the target customers of Nestle
Milkpak.

Maintain Price Leadership

With the very well analyzed prices Nestle Maintain its leadership regarding price.

Create Barriers for The New Entrants into the Market

The well managed and properly analyzed prices of Nestle Milkpak create barriers for the
new entrants in to the market.

Match Competitors Prices

Nestle always compare its prices with its competitors because its not the objective of
Nestle Milkpak to offer high prices beyond the prices offered by Nestle Milkpak.
Survival

Nestle Milkpak tries its level best to introduce such very well analyzed prices which
could be successful in its survival in the current situation where competition is all around.

Avoid Government Investigation or Intervention

Nestle Milkpak avoids any kind of Government interference as Nestle is Multinational

company and is offering acceptable prices by keeping all factors in mind.

Obtain and Maintain the Loyalty and Enthusiasm of Distributors and Other
Sales Personnel
Nestle Milkpak give equal importance to their distribution and sales personnel as they
have a concept that they can play their vital role in creating and maintaining customers
loyalty.

Enhance the image of the Company, Brand and Product

Nestle Milkpak also enhance the image of the company, brand name of Nestle and the
product itself.

To Perceive as Fair by Customers and Potential Customers

The target customers of Nestle Milkpak perceive the prices of Nestle Milkpak as fairly
priced as compared to the quality provided to them.

Use the price to make the product visible

Nestle Milkpak use the prices to make the product more visible among its target
customers.

Get competitive advantage

Nestle Milkpak get competitive advantage over its competitors by introducing a very well
analyzed prices of the Nestle Milkpak.

Determining Demand
There is an important relation between Price and the Demand relating the product that is
why it is given importance by Nestle Milkpak.

Price Sensitivity

Majority of the target customers of Nestle Milkpak are not price conscious. They are
found really conscious about the quality provided to them. The target customers of Nestle
Milkpak are more Quality Sensitive rather than Price Sensitive. Never any complaint is
yet received regarding prices of Nestle Milkpak.

Estimating Demand Curves

Nestle Milkpak make all possible necessary steps to measure the demand curve of Nestle
Milkpak using all possible Methods

Statistical Analysis

In the statistical Analysis all the collected data are analyzed for the purpose of
summarizing the available data regarding Nestle Milkpak to make it more useable.

Price Experiments

As the target customers of Nestle Milkpak are not price conscious therefore Nestle
Milkpak had never conducted Experimental Prices.

Surveys

Nestle Milkpak conducts surveys to know about ht opinions of the customers regarding
Nestle Milkpak’s prices. Most of the times through surveys Nestle Milkpak come to
know that their prices best suits the demand of their customers and also their customers
are quality conscious rather than price.

Estimating Costs
The cost of Nestle Milkpak till the end step of its production is considered and then the
price is given to the product

Variable costs

The costs of Nestle Milkpak available in different packing have variable. The prices of
Nestle Milkpak vary with the packing of the product. Also the prices of Nestle Milkpak
vary with the increase or decrease in the production cost or increase or decrease in the
ingredients that are used. The demand by the farmers to increase the price of per litre
MilkPak also influences the pricing of Nestle Milkpak.

Analyzing Competitors Costs, Prices and Offers

Nestle Milkpak also analyses the prices, costs and offers offered by their competitors
before offering new prices. Many times different offers are introduced by the rivals of
Nestle Milkpak to attract the customers but in that kind of situations Nestle Milkpak take
initiatives and handle the situation with counter attack.
Selecting a Pricing Method
Nestle use Cost-plus pricing which is the simplest pricing method. Nestle calculates the
cost of producing the product and adds on a percentage (profit) to that price to give the
selling price. This method although simple has two flaws; it takes no account of demand
and there is no way of determining if potential customers will purchase the product at the
calculated price.

Price = Cost of Production + Margin of Profit.

Selecting the Final Price

Price is an often overlooked marketing strategy for Nestle Milkpak, as they tend to focus
on promotions or advertising. Pricing strategies of Nestle Milkpak, however, can have a
large impact on sales and (more importantly) profit therefore Nestle Milkpak kept in
mind all the necessary aspects in mind before selecting final prices in the market. Nestle
Milkpak always reserves some of the portion from the sales of the product to spend on
the improvement and advertisement of the product. Company pricing policies are always
considered with full concentration before finalizing the prices of Nestle Milkpak.

Price Adoption Strategies

The price adoption strategies of Nestle Milkpak also vary with different situations.

Geographical Pricing
Nestle Milkpak offer same prices in all geographical areas of Pakistan. Nestle Milkpak’s
prices do not vary from area to area.

Discounts

Nestle Milkpak offer discounts only on the occasions of Eid and Ramadan etc.

Promotional Pricing

Some times Nestle prefer to offer promotional Prices but Nestle Milkpak offers
promotional prices in very rare cases.

Promotional Pricing Tactics of Nestle Milkpak

Nestle MilkPak use only tactic of Special Pricing Tactics that are quite imposing among
their target customers

Special Events Pricing

Nestle offer special Events Pricing especially during Ramadan and Eid etc.
Designing and Managing Value Networks and Channels
Marketing Channels of Nestle Milkpak
The marketing channels of Nestle Milkpak are very effective towards the enhancement of
the product. The Marketing channel of Nestle Milkpak play very vital role in the
development of Nestle Milkpak and attracting and retaining the customers of Nestle
Milkpak.

Marketing Communication of Nestle Milkpak

The marketing Communication of Nestle Milkpak is successful in informing, persuading
and reminding its customers. Through best and impressive Marketing Communication
Nestle Milkpak attract customers and the same times also retain those customers in such a
fantastic manner that Nestle Milkpak has many Loyal Customers.

Communication Platforms
The Communication Channels of Nestle Milkpak also play their vital role

Advertising

The advertisement of Nestle Milkpak is very eye catching. For advertisement purpose
Nestle Milkpak use:
 Print and broadcast ads
 Packaging inserts
 Brochures and booklets
 Posters
 Billboards
 Logos

Sales promotions

For the purpose of Sales Promotion Nestle Milkpak use different methods and sources.
For sales promotion Nestle Milkpak prefers sampling.

Public Relations
Nestle Milkpak also develop strong public relations. Nestle Milkpak prefer to build long
term Public relations.

Seminars

Seminars are conducted by Nestle Milkpak to create awareness about the products.
Annual reports

Annual reports of the company are also published to tell their customers about the
financial position of the company.

Charitable donations

Charitable donations are also a part of Public relations. Charities are given to different
welfare organizations.

Publications

Different articles are also published regarding Nestle Milkpak. Different interesting
publications has been published regarding the performance and quality of Nestle Milkpak

Steps in Developing Effective Communication

Different steps are involved in Developing Effective Communication

Identifying Target Customers

The main customers of Nestle Milkpak are the customers belonging to middle class and
above middle class. The main aim of Nestle Milkpak is to serve its target customers with
the best quality and other features because of the sincere serving Nestle Milkpak has
many loyal customers. Nestle Milkpak don’t afford to loose any of the loyal customers.

Determine the Objectives

The main objectives of communication are very well explained by Nestle Milkpak. The
main objectives of Nestle Milkpak are to very well communicate the image of the
products among its target customers. The objectives of communications of Nestle
Milkpak are very ell managed and that is why Nestle Milkpak has great positive image its
customers. The main objectives of the communication of Nestle Milkpak are:

Attracting and Retaining Customers

The main objective of Nestle Milkpak is to attract and retain customers never they can
think about loosing any of the loyal customers and for this purpose the message of the
brand name of Nestle Milkpak is conveyed in a very proper manner.

Brand Awareness
Creating brand awareness is also the main objective of Nestle Milkpak and nestle
Milkpak remained quite successful in creating awareness about the brand and as a result
the customers of Nestle Milkpak are very well aware of the product and play their role
through viral marketing.

Designing Communication
The communication of Nestle Milkpak is very well designed each and every aspect is
kept in mind to communicate with the customers in a very well and attractive manner.
The message of the brand Name of Nestle Milkpak is conveyed in a implausible way
through the communication channels of Nestle Milkpak.

Selecting Channels

Perfect and effective way of distribution and communication are selected by Nestle
Milkpak. Almost all effective channels of Nestle Milkpak are adopted by Nestle Milkpak
to serve its customers in a proper way.

Establishing Budget

Handsome budge is provided by Nestle for the improvement and performance of its
effective Communication. Nestle Milkpak never compromise on the enhancement of its
Communication towards its customers. Every year striking budget of million of $ are
spend on the communication purposes.

Factors in Setting Communication mix

The communication mix of Nestle Milkpak consists of almost all sources of
communication. Also the sources of communication of Nestle Milkpak are very well
represented also and also Nestle Milkpak has great image among its customers.

Type of Product Market

While setting the marketing type the type of the market is kept in mind by Nestle
Milkpak. The type of the product market of Nestle Milkpak require special attention and
the very well designed Marketing mix play its role in handling the type of the product of
Nestle Milkpak.

Consumer Readiness to make Purchases

The readiness of consumer was kept in mind before setting the Communication Mix. The
positive attitude of the customers towards purchasing the product can be called as the
Successful attempt of Nestle Milkpak’s Communication Mix.
Stage in the Product Life Cycle

The stage of the product life cycle of Nestle Milkpak counts a lot in determining the
Communication Mix. In the introduction stage of Nestle Milkpak it was required that the
Communication Mix should play its role and in the same manner Nestle Milkpak’s
Communication Mix played its role and as a result Nestle Milkpak reached its Growth
and Maturity stage in a very limited time.