brand strategy toffy nestle

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American International University-Bangladesh(AIUB)

Brand Strategy

ON

AppleToffee

(A product of Nestl Bangladesh Ltd)

PREPARED FOR:

Ehsanul H ChaudhuryAmerican International University Bangladesh (AIUB)

PREPARED BY

PIPLU BARUA ID: 08-92417-2

Date of submission: March 09, 2008

Table of Contents

Subject Page

Executive Summary I

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Acknowledgement II

Introduction 1

Current Situation (Macro & Micro Environment) 1

Market Summary 2

Target Market, Target Market Segment 2-3

Market Needs 3

SWOT Analysis 4

Competition 5

Marketing Strategy 5

Positioning 5

Marketing Mix Strategy: PRODUCT 6

Marketing Mix Strategy: PRICE 6

Marketing Mix Strategy: PLACE 6

Marketing Mix Strategy: PROMOTION 7

Marketing Research: 8

Financial Projections 8

Expenses Forecast: 8

Sales Forecast: 9

Break-even Analysis: 10Implementation Control 10

Conclusion 11

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Executive Summary

Nestl Bangladesh Limited started its first commercial production in Bangladesh in

1994. In 1998. Nestl S.A. took over the remaining 40% share from our local partner

when Nestl Bangladesh became a fully owned subsidiary of Nestl S.A.

Nestl Bangladesh's vision is to be recognized as the most successful food and drink

company in Bangladesh, generating sustainable, profitable growth and continuously

improving results to the benefit of shareholders and employees. Our factory is situated at

Sripur, 55 km north of Dhaka; the factory produces instant noodles, cereals and repacks

milks, soups, beverages and infant nutrition products. Today Nestl Bangladesh Ltd. is a

strongly positioned organization. The company will continue to grow through our policy

of constant innovation and renovation, concentrating on our core competencies and our

commitment to high quality, with the aim of providing the best quality food to the people

of Bangladesh.

The company wants to launch a new type of candy in the market. It is totally different

from the traditional candies. It is a high quality candy which will be harmless. In that

product, there will have some special ingredients which will provide Vitamin-C, and

which will be work as a breath refresher and which will be work as digester. So

definitely, that product will be an exclusive product in the market. The target market of

that product will be those who think that chocolates are harmful for teeth; the current

users of Vitamin-C tablets; the current users of fresh breathing tablets or candy; those

who have digesting problems; and the current users of the candy.

Our products will be beneficial for the consumers because it will be not only safe for teeth

but also good for teeth, it will fulfill the want of Vitamin-C, it will work as mouthrefresher, there is a real need for normal digestion and our product will work as digester,

and after all it will provide some exceptional tastes which will provide great pleasure. The

candy will be sugarless so it will not be harmful for teeth. There will no chemical color in

this candy. This is mainly a natural or herbal product which has no bad side effect.

After analyzing the market demand I have seen that there is a demand in the market for

this kind of product. I have seen that the company has a great opportunity to enter in this

business. Otherwise, there are a few risk involved this business. The product will be a

very new product and there is chance of rejection by the market. The competition will

also high. And if we succeed any large company can easily enter this market. Considering

all the possible threats I can suggest the company that it will be profitable to enter thisbusiness because there are some positive sides of the product and the company is also

strong. After estimating the cost and sales I can say that it will be profitable. So the higher

authority should consider this marketing plan.

ACKNOWLEDGEMENT

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One of the most pleasant parts of submitting a project is the opportunity to thank those

who have contributed to it. Unfortunately the list of expression of thanks no matter how

extensive is always incomplete and inadequate. These acknowledgements are no

exception.

I sincerely acknowledge my debt to our dearest faculty Ehsanul H Chaudhury for his

valuable counseling towards the improvements of the project. Without his

encouragements this would have been impossible.

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Introduction

Today Nestl Bangladesh Ltd. is a strongly positioned organization. The company

wants to introduce a new product Apple Toffee which is a new type of toffee but it is

totally different from the traditional toffees.

Apple Toffee will contain the flavour of apples so it will be tasteful for everyone.

In every toffee, there will be enough Vitamin-C so usually it will be beneficial for teeth

and gum and it will fulfill the want of Vitamin-C. In apple toffee, there will be some

ingredients which will work as mouth or breathe refresher. The product will help as

digester. After all, its taste will be exclusive and the quality will be high. It will be a

natural or herbal product.

As the representative ofNestl Bangladesh Ltd, I have analyzed the brand strategy of

this product whether it will be profitable to launch this product or not. The brand strategy

containing all its elements is presented in the next phases.

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Current Situation

Macro-environment:

Economy: Bangladesh is a developing country. Now though the economic condition

of this country is not so good, the industrial sector of this country is being powerful dayby day. The economy is turning from agricultural sector to service and industry sectors.

So the future of any industry like toffee in this country is very bright.

Government: Now the govt. is also attentive about the industry sector. The govt.encourages and helps to establish new businesses.

Legal: The govt. regulations or the legal condition of Bangladesh is also not a bigobstacle at starting new business or to launch new product. But in terms of introducing

new consumer product, a company must obtain the approval of BSTI (Bangladesh

Standard & Testing Institute). So to launch a new toffee the company must obtain BSTI

approval.

Technology: The technological environment of Bangladesh is not developed. So,new and advanced technology and machinery have to be imported from the abroad to

produce qualified candy.

Ecological: Day by day Bangladesh is losing her green beauty. Now people are alsoaware of this. So we also have to do business from societal marketing point of view.

Socio-cultural: From the socio-cultural point of view, there is no barrier for toffee.

The toffee has a good acceptance in Bangladesh. But many people are aware about its badeffect. They know that toffee is harmful for teeth and there is a strong idea about this in

mind of the people.

Micro-environment:

Customers: Bangladesh is an over populated country. It has a large amount ofpopulation. And many of them are fond of toffee. So there is vast market for the toffee

industry. But some people are disinterested about the toffee. So the people have also some

negative ideas about the product.

Competitors: The toffee industry in Bangladesh is not small. There are a lot of toffee producers. Some of them are national and some of them are local suppliers. Some

companies also export their toffee. In our country many foreign brands are also available.

They are comparatively costly also. So the consumers taste and demand are changing

from low quality toffee to high quality toffee. Now the toffee industry of Bangladesh is

very competitive.

Suppliers: Bangladesh has a lot of resources. Even then many items of the toffeeespecially chemical ingredients have to be imported from abroad. So the supply of raw

materials from local and foreign sources is very important in producing the toffee and its

good management can be a competitive advantage.

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Marketing Intermediaries: As the various branded toffees are available all overthe country, many intermediaries are now involved in this business. So using the present

intermediaries any company can reach their toffee easily to its target market.

MARKET SUMMARY

According to my market survey, the market has a demand of this kind of product. At

present, a lot of toffees are available in the market. And there are some kinds of Vitamin-

C tablet and a very few breath refreshing tablets are available in the market. But there is

an idea in the market that chocolate or toffee is very harmful for the teeth. So a lot of

conscious people do not take chocolate or toffee and many parents do no feel comfort to

give this to their children. So people have a latent demand of harmless toffee.

I have collected good information about the market and I have personally gathered a great

idea about the common attributes of our potential customers. Nestl Bangladesh Ltd. will

leverage this information to better understand who will be served, their specific needs,

and how the company can better communicate with them.

Target Market

a) Those who think that chocolates are harmful for teeth;

b) The current users of Vitamin-C tablets;

c) The current users of fresh breathing tablets or toffees;

d) Those who have digesting problems; and

e) The current users of the toffee.

Target Market Segments

Based on the major market segmentation variables our market has been classified. Then

after evaluating all potential market segments on the basis of each segments

attractiveness, I have selected the following segments where we will give emphasis.

Geographic:

The whole area of Bangladesh.

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Demographic: Children generally under teen-age.

Young generation generally under age range 13-25.

Old people generally over age 60.

The student generation.

Educated people and conscious parents.

Psychographic: The lower middle class, middle class, and upper middle class.

The conscious people.

Behavioral: Those who have negative idea about the traditional toffee.

Those who seek good quality. The non-users and regular users of the toffee.

Those who are unaware about the bad effect of the traditional toffees.

Market Needs:

In the market there is a great need of this kind of toffee. Apple toffee which will be

harmless for teeth and which will be good for heath, it has a demand for the customers.

Our products will fulfill the following needs of the customers:

Apple toffee will be not only safe for teeth but also good for teeth.

It will fulfill the want of Vitamin-C and there is great need of this.

There is a need for fresh breath and our product will serve this.

There is a real need for normal digestion and our product will work as digester.

After all, Apple toffee will provide some exceptional tastes which will provide

great pleasure.

Nestl Bangladesh Ltd. will provide the potential customers with high quality toffee. Thecompany seeks to fulfill the following benefits which are also important for its customers:

o Selection: Apple toffees which will give the customers a scope of selectionaccording to their choice.

o Accessibility: By using their strong distribution channel, Nestl BangladeshLtd. will make this product easily accessible to the customers.

o Competitive Price: The Company will also offer a reasonable andcompetitive price for this product.

o High Quality: By using high technology and high quality ingredients, Nestl

Bangladesh Ltd. will provide high quality Apple toffees.

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SWOT ANALYSIS

The overall evaluation of a companys strengths, weaknesses, opportunities and threats is

called SWOT analysis. SWOT analysis helps explore the areas of possible changes inmarketing activities. A brief discussion of Nestl Bangladesh Ltd internal and external

environment is as follows:

Internal environment analysis:

Every business organization needs to analyze its internal capabilities for developing

strategy. To fulfill its mission, Nestl Bangladesh Ltd is committed to capitalize on its

key strengths and overcome its major weaknesses. The strengths and weaknesses of

Nestl Bangladesh Ltd Apple toffee are summarized below:

Strengths:

High quality product offerings that will exceed the competitors price, quality and

services.

Nestl Bangladesh Ltd has a great company reputation

Customer loyalty of the company

Availability of capital

Use of modern technology

Financial stability

Weaknesses:

Apple toffee is a new brand of the company so it has lack of brand equity.

Nestl Bangladesh Ltd has this kind of product. But for this new type of product,

distribution and promotion will have to be taken.

As it is a new flavor product, it will be difficult to manage for the company.

External environment analysis:

Monitoring the trends of micro and macro environmental forces is also a key concern for

management of any organization to avoid the major threats and gain advantages ofpromising opportunities. The major opportunities and threats of Apple toffee are given

below:

Opportunities:

There is a demand for this kind of product.

Expanding awareness of people towards quality foods.

There is no existing toffee like Apple toffee.

Increasing the chocolate industry in Bangladesh.

Increasing rate of customers.

Mature retail market in Bangladesh.

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Availability of raw materials.

Threats:

The present candy manufacturers are also strong competitors.

Our product will be a threat to the Vitamin-C tablets. So we will also have to faceits manufacturers.

As it is a new product, there is a chance of rejection by the market.

It may fail to fulfill the expectations of the customers.

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BRAND STRATEGY

Brand strategy is the combination of some technique of the brand establishment that

means how can we develop our brand to the customer and also and how can us benefited

from our brand activities. Especially brand strategy is a combination of developing brandvision, establishing brand position, fulfilling brand contract, communicating brand

position and measuring ROBI (Return on Brand Investment).

Nestl Bangladesh Ltd will decide to market Apple toffee all over the country especially

in the urban and sub urban areas. It considers both sides- the customer side and the

business side. It has selected its target customers and on the business side the target

market is small to large size retail shops that want to help their products stay in touch.

Nestl Bangladesh Ltd overall marketing strategy will be to create a positive image of

offering the highest quality candy. Customers will be communicated through

advertisements such as TV ads, newspaper ads, and other media.

Brand Vision To provide highest quality toffee

Marketing vision:

To maintain positive, steady growth each month.

To increase new customers who dont buy toffee.

To attract current customers of the present toffees, mouth refreshers, Vitamin-C

tablets, and digesting tablets.

Generate brand equity in the market so that in future no company can take themarket by producing same product.

Create loyal customers.

Maintaining good relation with backward and forward intermediaries.

Financial vision:

Gain new sets of customers within 6 months that worth for Tk. 1,00,00,000

In the year-end TK. 6,50,00,000

Financial projections:

This section will offer a financial overview ofApple toffee. as it relates to the marketing

activities. I have addressed all expenses forecasts with fixed costs and variable costs and

with first six months estimated costs, sales forecasts with the first six months estimated

sales, break-even analysis, and the possible profit after six months in this section.

Expenses Forecast:

Estimated total Cost for the first Six Months:

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Fixed cost Tk.10,00,000

Raw materials Tk. 12,50,000

Preservation chemical Tk. 50,000

Rent Tk. 1,50,000

Employee (Operation & Sales) Salary Tk. 12,00,000Packaging Tk. 1,50,000

Promotional Expenses Tk. 5,00,000

Distribution Tk. 1,00,000

Commission Tk. 10,00,000

Operational Expenses Tk. 1,50,000

Administrative Expenses Tk. 1,50,000

Insurance Tk. 10,000

Interest Tk. 75,000

Miscellaneous Expenses Tk. 1,00,000

Total Tk. 58,85,000

Sales Forecast

There will not be enough sales in first month. In the second month the sales will be

increasing at a satisfactory rate. From the third month the increasing rate of sales will be

very high. That means from month three there will be a steady increase in production and

sales.

Our sales forecast is 1000000 pieces toffee for the first six months. On an average per

piece of toffee will be sold for Tk.10.

Estimated Sales for the first Six Months:

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Break-even Analysis:

BEV= Fixed cost / (Price- Variable cost)

1000000

10-5

=200000 units

So, breakeven point can be achieved within 6 months.

Estimated Sales (TK.)

180000

360000

540000

720000

900000

1080000

0

200000

400000

600000

800000

1000000

1200000

1 2 3 4 5 6

Consecutive Month

Series1

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Establishing Brand position

Nestl Bangladesh Ltd will position

Apple toffee as: Harmless toffees

Competition:

Although there is no product present in the current market, thisApple toffeewill be a great

threat for many candies and also some other products. All the present candies will be the

competitors of the Apple toffee. As our toffee will provide Vitamin-C, this will be a threat

for all the Vitamin-C tablets. And it will also be a threat for the breath refreshing tablets.

This will also be a threat to the digesting tablets or pills. So this type of products will also

be our products competitors. The main competing brands are as follows:

o In terms of candy, major competitors are Nabisco, Alpenlibe, Mon Chiri, Milk

Candy, Love Candy, Safari, etc.

o In terms of Vitamin-C, major competitor brands are CEEVIT.

o In terms of breath refreshing, Polo is the main competing brand.

o In terms of digesting tablet, Tasty Hajmi, Eno, Hajmola are the main competitors.

So here so many challenges on our product. Then we have to eliminate all challenges. We

can do it by following these steps of effective positioning:

Value:

Here Nestl will set value-based price. Our price will indicate that quality and consumers gut

feeling about the product. As we will build our image as quality product, we can charge a high

price not for product for brand.

Here, we can set Tk.5 for per piece toffee. And we also set Tk.25 for second type of

packet which contains 5 candies. And we can set up Tk.50 for the packet which will

contain 10 candies. This price will be the ultimate retail price.

Uniqueness:Product Ingredients

10 small to medium apples, washed and dried

4 cups (1 kg) sugar(white or brown)

8 oz (250g)butter

4 tbs white wine vinegar

4 tbsboiling water

1/2 teaspoon red food coloring

Steps

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1.

Have to mix the sugar,butter, vinegarand boiling water. Have to make sure of

using a saucepan that has a heavy base to prevent sticking.

2. Food coloring add.

3. Have to cook over a low heat.

4. Stircontinuously until the sugarhas all dissolved.

5. Once the sugarhas dissolved, boil the mixture for 10 minutes or until the mixture

reaches a 'hard crack' stage. Do not stir! If theres had a candy thermometer, thetemperature should read 150C (302F).

6.

Test the toffee. Drop a little bit ofcaramel into a bowl of water. If it hardens

immediately, it's ready.

7. Remove from the heat and let the bubbles disappear.

8.

Pierce the apples through with the wooden skewers. Push it through the top until it

gets halfway inside the apple. Check for a firm hold.

9. Tilt the saucepan with the toffee mixture in it. (Have to use some sort of wedge to

free up hands).

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10.

Dip the apple into the toffee and twist it around gently until the whole apple is

coated in toffee.

11. Remove the apple, allowing any excess drips to fall back into the saucepan.

12. To harden the toffee, dip the covered apple immediately into ice cold water (throw

in ice cubes if necessary).

13.

Put the apple down onto a tray covered in baking paper to set.

14.

Serve and enjoy!

We have to make high quality products. So for the production we have to use high

technology. We have to maintain machinery based production, packaging and quality

control. We will launch our products in apple flavor. We will also have the plan to launch

toffee at the taste of Grape, Pineapple, Tamarind, Olive etc.

The design of the product will be the slender-round and the slightly long. The color of the

product will come form the ingredients. The package of the toffee will be attractive and

exclusive. Initially the company will make available this product for retail sales in threetypes of packet.

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Credibility:

By using the present distribution channel Nestl Bangladesh Ltd can easily market this

product. The company has many consumer products. The company can use its presentmarketing channel to make the products available all over the country.

Nestl Bangladesh Ltd can also use its current delivery vehicles to deliver the product to

the wholesalers. The company can use its local offices to deliver to the retailers. So at

introduction stage, companys current marketing channel is enough to deliver the

products to wholesalers and retailers.

Communicating Brand Position

To develop a total promotional campaign we must answer these questions:

I. What message and image do we want to promote?

II. What are the best media and activities for reaching our potential customers?

III. How much time and money can we spend on the effort?

Nestl Bangladesh Ltd will take a large promotional program for this product. The

company will keep a hand some amount for the promotional activities of the product. Asit is a new brand more promotion is needed to build up the brand awareness.

Nestl Bangladesh Ltd will use ads through TV, Radio, and Newspaper to aware people

about this toffee. The company will take the strategy to create awareness about the bad

effects of the traditional toffees. Then the company will present its toffee to the market as

harmless.

In the promotional activities, the company will focus or emphasize on the children and

students as well as old people. In the newspaper advertising, the company will know or

inform the people about the bad effect of the traditional candies and inform about the

good sides of theApple toffee. In their TV commercial they will also try to build awareness

in the minds of the customers and try to acquire a strong position in the minds of the

customers. In the electronic medias advertising the company can present famous and

renowned doctors to inform people about the difference between traditional toffees and

ourApple toffee.

The company will take a mass public relation program.Nestl Bangladesh Ltd will have

to take this kind of promotional activities such as stall booking in many trade fair, child

fair etc. to create a positive image about the brand. The company needs no special

personal selling program for this product. In introduction stage sales promotion will not

also be considered.

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Nestl Bangladesh Ltd will give many facilities to the retailers and the wholesalers. To

take the competitive advantage the company will give more facilities than its competitors.

The intermediaries are given many gifts items such as wall clock, T-shirts etc. and sales

helping equipments such as keeping pots, bill board etc.

They will develop some cartoons which will be used on the T-shirts, bill boards, neonboards, and in some ads to attract the children and young people. The company also uses

this brands logo, picture, symbol etc. on many toys, dolls and on many other things to

know and attract the target market.

Measuring ROBI

Initially we have to monitor the goals, the marketing process in every month. If there find

out any gap in plan and output, we have to take corrective actions. Not only that, if there

is any problem arise in production, marketing process, or any other areas, we have to take

necessary steps to overcome that. There is a low possibility of new competitors in the

market. The marketing strategy could be change of reform. We know, in the marketing,

arena every challenge makes an opportunity if the program is handled smartly. Finally,

the management will monitor the total environment, progress, and gap and will take the

corrective actions if necessary. The company always has to maintain the TQM (Total

Quality Management).

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CONCLUSION

We are very much confident about the new product Apple toffee as there is no such kind

of product in the current market and our product will be high qualified. This product has

some exclusive characteristics that will help us to acquire position in the minds of the

customers. We have a plan of exporting our products to the foreign countries. If we want

to do this then we can collect a hand some amount from the foreign market. Then we can

go for vast production or in other business which will create opportunity in the market.

And we can serve the society or the people through our business.

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