MARKETING MANAGEMENT

Submitted to:
Ma’am Nida Shaukat

Submitted by:
Maria Rizwan (20201-28830)
Aiman Aamir (20202-27147)
Muhammad Bilal Siddqiui (20201-27591)
Muhammad Hasan Rehmani (20191-26553)

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Contents
Introduction Of Nescafe:............................................................................................................3
VISION STATEMENT:..................................................................................................................3
Nescafe in Pakistan:...................................................................................................................3
Product range.............................................................................................................................3
Summary of Report:...................................................................................................................3
Primary Target audience:...........................................................................................................4
Segmentation:........................................................................................................................4
Targeting:...............................................................................................................................5
BCG matrix:................................................................................................................................5
Unique selling proposition:........................................................................................................6
Nescafe’s Marketing Mix:...........................................................................................................6
PRODUCT:...............................................................................................................................6
PRICE:.....................................................................................................................................8
PROMOTION:..........................................................................................................................8
PLACE:...................................................................................................................................10
PRODUCT LIFE CYCLE STAGE OF NESCAFE:..............................................................................10
SWOT Analysis In terms of Pakistan:.......................................................................................11
Strengths:.............................................................................................................................11
Weaknesses:.........................................................................................................................11
Opportunity:.........................................................................................................................11
Threats:................................................................................................................................11
Strategies On SWOT Analysis:..................................................................................................12
Ansoff Matrix for Nescafe:.......................................................................................................12
Maslow Theory of Needs:........................................................................................................13
Nescafe Positioning strategies:................................................................................................13
Nescafe Basement:...............................................................................................................13
Nescafe Debate with celebrities:.........................................................................................14
Conclusion:...............................................................................................................................14
Bibliography:............................................................................................................................14

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Introduction Of Nescafe:

“Nestlé is the world's leading nutrition, health, and wellness company. Our mission of "Good
Food, Good Life" is to provide consumers with the best tasting, most nutritious choices in a
wide range of food and beverage categories and eating occasions, from morning tonight.”

VISION STATEMENT: Nestle

To be a leading, competitive, Nutrition, Health and Wellness Company delivering improved
shareholder value by being a preferred corporate citizen, preferred employer, preferred
supplier selling preferred products.

Nescafe in Pakistan:
Helping foodservice operators expand their drink menu with a range of trusted Nescafé
products & hot vending solutions. High-quality coffee and coffee drinks are available in a
variety of easy-to-use formats to ensure that you always serve a good cup of coffee.  It’s the
only coffee brand that can offer foodservice operators such a high level of consumer appeal,
variety, and service to suit any operation.

Product range: https://www.nestle.pk/brands/coffee

Summary of Report:
Nescafe has been a part of many routines, from a 3 a.m. paper cup of Sunrise on a quiet
road to a Classic in the morning before work or a Chilled Latte in the evening. Not exactly,
but the warm Nescafe Campaigns have helped to establish the coffee brand as a household
name. It's difficult to talk about Nescafe's advertising successes without humming the
company's distinctive hymn. The Nescafe jingle was linked with coffee in its early years, as it
made its way through a country dominated by chai. Well, similarly in this following report
we will observe with many marketing aspects how Nescafe positioned itself in a tea-
dominated country, Pakistan.

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Primary Target audience:
Segmentation:
Segmentation is the technique of breaking down marketing into smaller chunks to focus
better on customer demands. Every business segmentation is done with a few variables in
mind. We will be observing Nescafe’s segmentation in Pakistan. There are four fundamental
forms of segmentation, however, they can be done in a variety of ways. The four
fundamental forms of segmentation are as follows:

1. Demographic: dividing the market by age, gender, income, life cycle,

and other factors.
Nescafe has made an effort to segment every age group, family, area, gender, and
socioeconomic status. They are mostly concerned with age and money. Nescafe is aimed
towards those in their late teens and early thirties. It aimed at the 30+ sectors as a
secondary target market. Café culture among young adults: They appeal to this
demographic with their new latte line plus iced coffee, as well as advertising, sales
promotions, and a competition to win against tea culture. Nescafe has split its market based
on people's income levels. Nescafe is accessible to individuals of the upper class, upper-
middle-class, and even lower middle class.

2. Geographic: Area-based division of the market

The country has been split into two sections by Nescafe: southern and northern.
Coffee consumption is highest in the southern segment, which favors hard and roasted
coffee. Whereas, Nescafe instant coffee is consumed in greater numbers in the northern
areas due to the cold weather.
Nescafe divides cities into categories based on their size and population. Nescafe targeted
urban cities like Karachi, Islamabad, and Lahore due to the increasing coffee culture.
Nescafe has been concentrating all of its energies on appealing to the urban populace. The
corporation believes that transferring resources to rural regions will not be cost-effective
due to restricted resources.

3. Psychographic: dividing the market into segments based on

personality attributes, life objectives, interests, and lifestyles.
Coffee is a drink associated with the upper crust of society. As a result, Nescafe caters to the
higher social class of society.
Consumer from the middle class and upper class (aged 15-45/50): The consumer receives a
cost-effective advantage as well as a high-quality product.
People feel that coffee intake is a sign of a successful and luxurious lifestyle. Nescafe
consumers or potential users are considered to be people who lead active lives, which is
why Nescafe created its Instant beverage range.

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Nescafe has given its goods a brand identity that is in line with its current and future
customers. Confident, Positive, Success and Achievement-Oriented, Getting Started in Life,
Dynamic and Optimistic are some of Nescafe's personality qualities.

4. Behavioral: Dividing marketing based on consumer patterns such as

purchasing and browsing, furthermore, based on brand loyalty, etc.
Users of Nescafe may be described as "those seeking to be recharged," "people wanting to
let others know that they have significant stations in life," "those who want to start their
day with something nice," and so on. Nonusers, potential users, first-time users, and
frequent users of coffee are all segments of the Nescafe market.
Markets are divided into heavy coffee drinkers, medium coffee drinkers, and light coffee
drinkers. Nescafe aims to attract heavy to medium coffee drinkers. Plus, the majority of
urban city consumers are switching towards coffee.
Purchase Times: Nescafe markets its beverages as being suitable for a variety of occasions,
including breakfast, lunch, dinner, night (when you want to stay awake). Usually, in Pakistan,
coffee is consumed on occasions like weddings especially in winters.

Targeting:
After segmentation, targeting is the process of dividing the market into smaller target
groups. Similarly, Nescafe primarily targets the socioeconomic class of users. Potential
Nestle customers are those who believe the company's products are of high quality.
However, the company's products are not inexpensive, and so not everyone can buy them.
Nescafe's product management is now focusing on targeting upper-class high-income
customers, as well as 18-24-year-olds, who are most likely students and young
professionals. The importance of this category is that individuals are building habits at this
time, thus Nescafe believed that if they effectively targeted these people, they might turn
them into long-term Nescafe customers. Nescafe is trying to target majorly consumers
interested in such cold/warm beverages.

BCG matrix:

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Simply defined, this matrix is a portfolio management structure that assists firms in
determining how to prioritize their many enterprises. It's a table divided into four
quadrants, each with its distinct symbol denoting a different level of profitability. Question
marks, stars, pets (typically represented by a dog), and cash cows are the four quadrants. In
Nestle’s product portfolio, Nescafe is considered a star product. Since in Pakistan, the
growing coffee culture and majority coffee market share being with Nescafe makes its way
towards becoming a star product. Even though the beverages market of Pakistan has fierce
competition but Nescafe has paved its way.

Unique selling proposition:

Nescafe offers a variety of tests, goods, and coffee options to customers, allowing them to
get exactly what they want while increasing revenues and customer pleasure. Customers
can easily comprehend the corporation.  Customers become familiar with the brand and can
interact with it through the Nescafe website and activities. Nescafe conveys distinctive
benefits and positioning since customers perceive a difference based on brand image
differentiation when competing offers look the same.

Nescafe’s Marketing Mix:

PRODUCT:
Product levels:
Core product: Beverage.
Expected Product: Coffee, drinkable, refreshing taste either cold/hot coffee.
Augmented Product: Easy to make, quality coffee beans/taste, long-lasting quality,
portable packaging, and easily available.

Potential Product: Make it environment-friendly, de-caffeinated product, organic fat-

free, freebies (complimentary mugs or gifts)
Nescafe is one of the most popular and recognizable brands of coffee which offers a wide
range of products so that people can have more choices accordingly and they can easily
cater to the need of every individual out there, be it a coffee lover or non-coffee lover.
Moreover, they also introduced their coffee machines that attracted a lot of people towards
consumption of coffee and less of tea. They introduced a variety of high-quality brands
under the umbrella of Nescafé for high visibility and to target a huge chunk of people
towards consumption of coffee. Since in Pakistan drinking tea is a tradition so to replace it
with tea, Nescafé has used similar strategies with tea-producing competitors to make coffee
richer, creamier and it will taste exactly like tea to build the taste of the non-coffee
consumers. Also, Nescafe comes in different pack sizes for example sachets, cans, boxes,
different mg bottles so that people won’t hesitate to buy and try it because in Pakistan
mostly people don’t try a product if it doesn’t come in travel size packaging. On the back of
the mind, they always doubt that if they don’t like the product, it will go to waste.
Therefore, the size of the product is going to motivate people to buy coffee. For people who

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are always in hurry and just want to have something really quick but delicious at the same
time, instant coffee is the answer. Furthermore, consuming coffee lowers the risk of many
diseases as compared to tea. The flavor of Nescafe is so rich that even a tea consumer will
get addicted to Nescafe. The presence of coffee machines in offices, educational institutes,
hospitals, cafés are likely to convert tea drinkers to coffee drinkers.
Following is a wide range of Nescafe:

 Nescafé Original
 Nescafé Classic
 Nescafé Black Gold
 Nescafé Classico
 Nescafé Decaff
 Nescafé Espresso

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PRICE:
Nescafe products are mainly high-quality products, hence significantly priced. It has been
introducing a lot of variants and new items so that customers have a wide assortment to
choose from. The price of the products depends upon the quantity of the product provided
to the customers. Sachets are relatively cheaper so it’s easy for people to have a cup of
coffee at a lower cost. Nascafe price ranges from 30 rupess to 1500 something. Here are
some pricing strategies concerning the Pakistani audience: initially Nescafe should opt for a
pricing penetration strategy to build a strong customer base, since in Pakistan highly
consumed caffeine is tea, so to make them switch to coffee, product prices must be kept
lower from tea. Usually, the Target market in Pakistan waits for different offers and lower
prices. Here we can say that the price of one product affects the demand of another. So, if
coffee prices are lowered, the demand for tea will automatically decrease. Therefore,
Nescafe must lower its prices to increase the demand. They should offer different banded
backs, bonus packs, and redeemable coupons. Once the Pakistani audience is fully
convinced to replace tea with coffee, a price penetration strategy must be implemented.
Special offers must be given on special occasions or seasons.

PROMOTION:
Through a lot of promotional strategies nestle tried to make the product appealing to the
customers. They attempt to create an emotional connection to win the hearts of consumers.
They always focus a great deal of attention on their advertising strategy they make sure that
consumers are satisfied with the product. Nescafe promotes its product through different
social media platforms, TV commercials. Though a lot of changes in the packaging and
product have been made in the past, however, the logo of Nescafe is still the same since its
origin to maintain the authenticity of the product and to expand the brand value. To convert
tea lovers to coffee consumers, Nescafe introduced Nestea. Moreover, there are a lot of
well know celebrities as brand ambassadors to push the brand. Nescafe always promotes
the product uniquely and creatively to grab the attention of the maximum number of
people. However, in a country like Pakistan when people prefer tea over coffee, Nescafe
need to promote the product through heavy advertising campaigns, public relation,
magazines, television, and social media marketing (Instagram, snap chat, Facebook),
different billboards, etc. in Pakistan to persuade the audience. Blocking strategy must be
followed where Nescafe advertisement must be played on different channels at the same
time. Since we live in a technological world, search engine marketing (SEM) will help to
reach the target audience rapidly. Moreover, popular celebrity endorsement (Mahira khan,
Sajal Aly, Shehreyar Munawar, Atif Aslam) should be done to market Nescafe on television,
radio, print, and the internet to create an emotional connection and to influence peoples
buying behavior. Whenever a strong personality or figure is associated with the product, the
perception of the consumer automatically improves as they highly influence the Pakistani
audience, they feel that the product is credible. They should also propose different
promotional offers like buy one get one free, free sample, free trials, discounts such as
season end sale, cross-promotion, win a ticket to XYZ country for people to at least try the
product. Eventually, it will increase their sale in Pakistan and people will switch to coffee.

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PLACE:
Nescafe makes sure that its products are distributed all over the world to cater needs and
wants of every individual. It must accessible in all shops and not only in big supermarkets
because tea is a growing business and it’s easily available in almost every shop out there. So,
to give coffee an edge, it must be conveniently available to people. It must be placed in
supermarkets (Imtiaz, chase, Naheed), general stores, small local shops, grocery stores, and
convenience stores. Nowadays there are countless cafes in Pakistan. Therefore, the
increasing no. of coffee shops and friend suggestions are one of the reasons why people
especially young adults prefer coffee to have coffee in cafes, they associate it with
youthfulness, Live music, a bookshelf can attract people to choose coffee over tea.
Furthermore, there must be Nescafe machines in offices, universities, schools, colleges
where everyone can make a coffee according to their preference (strong of light). Following
are the type of distribution strategies Nescafe can use:

 Direct Store Delivery

 Customer warehouse
 Online merchandising
 Retailors

PRODUCT LIFE CYCLE STAGE OF NESCAFE:

Nescafe has been in the maturity stage for ages in Pakistan. They’ve used product extension
strategies to keep their sales intact and maintained. Sales revenue and profitability are quite
high however it has slowed down as compared to the early introduction stages.

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SWOT Analysis In terms of Pakistan:
Strengths:
Brand Equity: Nescafe’s brand value is $17.4 billion and is the largest brand under
Nestle’s umbrella. Also, it is the leading coffee brand in Pakistan winning most of the market
share in the coffee market.

Quality: Nescafe is a high-quality product and has managed to stay away from

controversies. They have stringent quality control techniques and have managed to develop
a strong bond with their customers. In Pakistan, Nescafe is known for its unique coffee
beans quality.

Diversity: It possesses a large diversity in terms of tastes and products, the strength of
coffee content, and the types of coffee beans used in the production. Nescafe provides
comfort variety to Pakistani consumers to keep consumers loyal as well.

Excellent Promotional Campaign: Their promotional campaigns have always

remained popular. They gain visibility very quickly. They touch the strings of the heart
perfectly. Their advertisements are connected with everyday lives and involve known
celebrities where the audience feels connected.

The Nescafe jingle: Nescafe has one of the most loved advertising jingles.

Weaknesses:
Expensive coffee: The target market of Nescafe products is upper middle and high class
because the lower middle and poor class cannot afford to buy Nescafe products and
especially coffee.

Opportunity:
Tie-ups: It can tie up with different corporates, educational institutes, and other public
enterprises to gain market share and drive more profits.

Growth in Public income and Coffee Culture: The income of people is constantly

on a rise and they tend to move towards premium taste which is coffee in the beverage
category. So, they have a potential customer base who might want to move towards this
drink. Plus, the growing coffee culture is on the rise.

Introduce complementary products: Nescafe can plan on biscuits or cookies which

can be sold with the coffee or which go very well with the coffee flavor. They can also make
these biscuits as premium biscuits in the market. This will not only increase sales but give an
edge in the tea dominant market.

Threats:
Economic uncertainty: Price fluctuations due to rupee devaluation as raw materials are
imported. The uncertainty of economic conditions poses a great threat as the major funds

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invested in the country come from outside Pakistan. Nescafe being a franchise brand is in
constant worry.

Fierce competition: The biggest competition of Nescafe is Tea products. Pakistan being a
tea dominant country, this is the biggest threat.

Inflation: Pakistan being very expensive and a country importing most of its products; It
makes it difficult for consumers to go for products like coffee.

Health Consciousness: People who are more considerate about health tend to move
away from caffeine content drinks.

Strategies On SWOT Analysis:

The SWOT analysis above reveals that Nescafe has many strengths, which translate into the
development of core resources and capabilities, which helps their competitive position.
Notably, one of the core strengths of Nescafe is the strong brand image they have which
inspires trust in consumers. Nescafe can build on this reputation to extend its brand
categories. Further, recent efforts to follow corporate social responsibility strategies have
heightened the firm's approach to sustainability, which is aligned to current expectations
from the consumer market for firms to take a greater responsibility towards the wider
macro environment of Pakistan. Moving on to a critical analysis of the weaknesses
of Nescafe, they only target the upper and middle class. Therefore, they need to utilize
lower social class opportunities. One of the main threats identified by the SWOT analysis is
the industry's growing competitiveness, as well as the problems that come with it. As a
result, the level of dynamism and volatility that the firm must manage poses a significant
danger, influencing the character and direction of strategic decisions.

Ansoff Matrix for Nescafe:

The Ansoff matrix is a strategic tool designed to assist and advise firms in making growth-
related decisions. Businesses can choose from four strategic options in the Ansoff matrix:

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market penetration, market development, product development, and diversification. A
company or organization must adopt one of these four strategies, or a combination of them,
based on internal and external considerations. External influences can include things like a
region's political stability and economics, while internal elements can include things like
talent management and resource capacities. Organizations choose multiple growth
strategies based on an analysis of internal and external factors, which can be roughly
outlined using the Ansoff matrix.
Nescafe can penetrate existing markets with its existing coffee range through competitive
price policies, enhanced distribution methods with competition to tea. Furthermore,
Nescafe can try product development through research and operations. They can introduce
budgeted coffee versions for the lower class in Pakistan, which will increase the market
share and expand their sales. This can provide a competitive edge to Nescafe with tea in the
market. New customer segments can be explored in this way. Nescafe can modify products
as well. Moreover, Nescafe tried diversification through Nescafe basement providing
consumers a new experience.

Maslow Theory of Needs:

If we connect Nescafe with Maslow’s theory of needs, Then Nescafe’s products fall under
self-esteem needs. As coffee is considered a luxurious product, it is not a need which is why
it is best suited in this category.

Nescafe Positioning strategies:

Nescafe Basement:
Nescafe has always implemented great advertisement techniques to position itself. From
using influential people to connecting with the consumer by providing a great coffee
experience, Nescafe has done it all. One of the most prominent ways of promoting Nescafe
in Pakistan was the launch of “Nescafe Basement” in 2013. This show is produced by
Nescafe and artists are recruited/mentored by Xulfi. Since 2013, Nescafe connected with
Pakistan’s audience through music. Nescafe even further provided the platform for young
individuals to explore their talent and gave consumers a whole new experience of enjoying
coffee with music. This was indeed a breakthrough moment for Nescafe since Coke studio
already existed. Nescafe was successful in this and this further grabbed the consumer's
attention. From tweens, teens, young adults to old people; All age groups were targeted
with the diverse genre of music.

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Nescafe Debate with celebrities:
Nescafe collaborating with multiple known celebrities launched a video titled “The Great
debate is on us”. The entire video focused on how Nescafe or coffee is better than tea. This
was one of the important techniques used by Nescafe to highlight how it is replacing tea in
many ways. They used humor and consumer involvement in the entire campaign to
promote how important Nescafe is. Nescafe used the tagline “Jagna tou parega” to position
itself by taking a hit on tea-consumers how they always drink it solely to just stay awake,
while Nescafe focusses on how being fresh and active is more important.

Conclusion:
We finally conclude this report. We reviewed all aspects of marketing in this report and
prepared an in-depth analysis for Nescafe. Keeping Pakistan’s large audience and Nestle’s
popularity in mind, it can be observed that Nescafe has very well marked its stance in a tea-
dominated country. If Nescafe works the most on maintaining its brand image, quality then
Nescafe can turn out to capture the tea-market share as well. Especially connecting the
product with musical elements like mentioned above, will yield positive results.

Bibliography:
https://www.fuchsiamagazine.com/2019/02/20/coke-studio-vs-nescafe-basement/
https://www.nescafe.com/pk/
https://www.nestle.pk/
https://prezi.com/b4lfjguqrcwy/nescafe-swot-analysis/
https://www.marketing91.com/marketing-mix-nescafe/
https://www.youtube.com/watch?v=PJ_C3o0y0u4
https://gulfnews.com/world/asia/pakistan/coffee-culture-is-on-every-lip-
1.1965199#:~:text=The%20coffee%20culture%20surfaced%20in,entered%20the%20arena
%20in%202007.&text=Over%20the%20years%2C%20coffee%20transformed,have%20come
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https://www.academia.edu/37463887/
strategic_management_report_on_Nestle_Pakistan_docx

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