Maggi is a Swiss company that is currently in the top position in the Indian food industry. It originated in the late 19th century as a helping hand for working women who had limited time to make tasty and balanced snacks or meals. To add flavour, it uses quick and easy solutions like bouillons, soups, seasonings and sauces.
In this blog, we will discuss the 4Ps of the Marketing Mix of Maggie, and the key to its success in the food industry. Let us first know about the company-
Maggi is an international food company, originated in Switzerland in 1884. Julius Maggi created Maggi as a vegetable food product that could be prepared quickly. He became a pioneer in industrial food production to improve the nutritional value of workers’ families. Maggi was the first to market protein-rich legume meals and in 1886, made a ready-made soup based on legume meals.
Maggi’s holding company merged with the Nestlé company in 1947 after various changes in ownership and corporate structure and in 1980 it was launched by the Nestlé group of companies. The products include soups, sauces and instant noodles.
Maggi’s relationship with India is a well-established one. Nestlé’s Maggi first came to India in 1983 when India lifted the Cricket World Cup for the first time and it was an instant hit. India has soon become the largest market for the company, it is also Nestlé’s single-largest revenue earner in India.
Now that we have a brief about the company, let us dive into the marketing mix of Maggi
Marketing Mix of Maggi
“Marketing mix” refers to a business foundation model whose main focus is 4Ps which denotes the product, price, place and promotion.
It is a collection of marketing techniques that a company uses to meet its marketing objectives in the target market. It covers marketing and business strategies around the business as a whole.
Let’s learn the marketing mix of Maggi
1. Product Strategy
Maggi is a leading food brand from Nestlé. It has a variety of products and has a different range for each country. Consumers also buy their products as they are low priced and affordable for almost everyone.
It has brought innumerable products to the market according to the needs and tastes of its consumers. Its products are majorly categorized into noodles, soups and seasonings. These products have exceeded people’s expectations and became their absolute favourite.
Through attractive graphics, Maggi’s label helps to promote the product. Their labelled products information includes the logo, weight of each package, product ingredients, expiry date, cooking instructions, consumer services line, manufacturer’s information and nutritional information.
Maggi introduced “money saver multi-packs” in the form of 2-in-1 packs and 4-in-1 packs. They contain a service that lets the consumers try their products to get feedback from consumers of the products.
2. Price Strategy
Maggi uses cost-based pricing strategies so that it can enter different markets around the world. It shows that competition and cost are the two main factors for its marketing mix pricing strategy. It has a clear-cut policy about pricing and has kept the policy low since the early years as Nestlé tries to capture maximum market share with low price and high quality.
To keep up with the changing economic times, Maggi has reduced the amount instead of price. In addition, Maggi offers packets of different sizes at different prices for middle and low-income customers so that everyone can buy according to their budget.
Pricing strategy for the existing variants of products based on the objective of “Maximizing Market Share”. These variants are competitively priced. Since it is extremely price-sensitive, any price change triggers an instant price check response from the competitor. Nestlé tried to survive if they were afflicted by intense competition. They tried to cover variable costs and some fixed costs to remain in the industry.
It adjusts prices by using promotional pricing techniques. For example, they offer ‘Buy One Get One Free’ during the mega sales season. Furthermore, Nestlé also implies segmented pricing. For the different locations and different flavours, the price sets of Maggi products are different.
3. Place and Distribution Strategy
Maggi’s products are widely available due to Nestlé’s strong presence. It runs the chain of distribution systems from Distributor to Retailer to Consumer so that the product is distributed properly.
- Nestlé – The company has decentralized the production process where each plant is responsible for its production. It follows a two-fold path for distribution. In the first, the product is available to every local store, and in the second where the stock is available for every mall and shopping center.
- Distributor – The company offers its distributors a clear-cut margin which is 6%. In this scheme, the distributor pays the company in advance but provides the products to the credit of the retailers.
- Retailer – The retailer in turn gets a 15% margin on promotional products and a 10% margin on normal products.
The key component of its marketing mix is its distribution. Maggi products are taken directly from the factory which is operated individually at carrying and forwarding agencies who later store large warehouses there and deliver to the wholesalers according to the quantity as per their demand. These quantities are then distributed to retailers or the end customer through hypermarkets, other small businesses. Retailers are convenience stores or local supermarkets.
Therefore, it has achieved the top position everywhere be it rural or urban markets. It can be found even in an unfamiliar alley. This single factor – distribution, has been the backbone for product success.
4. Promotion and Advertising Strategy
When the parent company Nestlé decided to launch Maggi in India, they used their advertising as a major promotional strategy to create awareness and recall the brand. Initially, it focused on children and working women who have very little time to prepare meals. They also gave toys and utensils along with packets of noodles as gifts, which created an attraction for customers.
Dry sampling and wet sampling are some strategies everyone can see in the supermarket. Promoters always distribute packets of Maggi noodles both dried and wet samples (cooked noodles) to the consumer. From the Nestlé webpage, consumers can get items that are promoted in certain months.
Maggi advertised on children’s channels and mainstream television programs. The tagline “2 Minute Noodles” is known as the smartest tagline in the advertising industry and is still very popular among consumers. To attract customers, it has announced several offers and schemes over the years. Such as funny books, free Maggi products, scratch & win coupons, discounts & cashback offers.
On its 25th anniversary, it began promoting voice over to create a nostalgic feeling among customers about their journey with Maggi. It has also used the “Miss You Maggi” advertisement campaign to get back lost customers after the Maggi ban in India. It also uses many celebrities for brand endorsements like Amitabh Bachchan and Madhuri Dixit.
You will find the Maggi advertisement heavier when bringing new products to market. However, from time to time, it also advertises product redesign.
Public relations is also done by Maggi through organizing some innovative campaigns. For illustration, the campaigns of “Remembering your good old days with Maggi” and “Main Aur Meri Maggi” campaigns were held by the company to celebrate 25 years of the brand and to empower the connection of consumers with the brand through an emotional touch. To learn more about how the company made its comeback, click here.
Maggi is a successful company that has nailed its product offerings in both quality and variety. It has embarked on a journey to help people of all walks of life with the main target of children and working women. They offer affordable prices so that everyone can buy their products. Its mission is to become an inspirational growth partner providing creative, branded food and beverage solutions that enable operators to innovate and delight consumers and its vision is to consistently market and sell high-quality food to meet customers’ daily needs.
Found the blog interesting? If you want to learn more about Digital Marketing, check out our Free Digital Marketing Masterclass by Karan Shah, the founder and the CEO of IIDE.
Thank you for reading the blog, do share it with your friends, and let us know your views in the comment section.