In the previous blog, we had done comprehensive research about the Marketing Mix of Milo by looking at all the 4Ps strategies. In this blog, we are going to view the SWOT Analysis of Milo – the iconic tasty milk drink from Nestle in detail.
Milo is the world’s biggest and most popular chocolate malt beverage (powdered product) that can be made by mixing it with cold/hot water or milk or both.
Milo was first developed and introduced in Australia in the early 1930s but now globally, becoming one of the favourite and most liked drinks among children, teenagers, and adults. And yes, you read it right, adults too! But how did Milo do this? It is because Milo offers high-quality products that meet the desired wants of the consumers and satisfy their needs.
Also, Milo’s digital marketing strategies have played a vital role for them to become so popular around the world. It is marketed as a vibrant beverage strongly related to good health and sports.
In this digital era where almost every business is going online, digital marketing has become very important in today’s world and if you want to learn and gain more knowledge about it, go over to our Free MasterClass On Digital Marketing 101 by Karan Shah, the CEO and Founder of IIDE.
In this case study, we will learn about the SWOT Analysis of Milo. But first, let us know about the company and the product better.
(Nestle’s Milo – A Tonic Food Drink, Source: Milo)
Have you ever wondered what this unique name ‘Milo’ means? The word and the name of the brand ‘Milo’ are derived from a Greek character’s name Milos of Crotona who was known for his strength.
Milo is an iconic, very tasty and crunchy milk drink developed by Nestle (one of the world’s biggest food manufacturers) in the 1930s. Thomas Mayne, a Nestle Engineer, developed this nutritious and delicious beverage using local milk expertise and Swiss cocoa expertise for children as a direct response to the reality that children were not receiving enough nutrients from their regular diet.
The company manufactures the product with the use of local ingredients such as malted barley, dried milk and cocoa. It is a powdered product that needs to be mixed with milk, hot water, or both to make a beverage.
|No. of Employees||352,000 at Nestle|
Products of Milo
(Milo’s Range of Products, Source: IIDE)
- Milo Powder
- Milo with Whole Grain Cereal
- Milo Less Sugar
- Milo Dairy Free Almond
- Milo Nutri Plus
What’s new with Milo
Check out some current news about Milo:
- The refillable vending machines for Milo and Koko Krunch were introduced in Indonesia by Nestle.
- Nestle introduced new sugar-reduction technology.
Target Audience of Milo
Following is a buyer persona that gives a clear understanding of potential customers of Milo:
- Appealing ads on social media.
- Different varieties are available.
- Quality Products.
Interest & Hobbies
- Playing Guitar
- Limited flavours of certain products.
- The product is not available in small quantities.
- Low in Stock.
Social Media Presence
Now we have a better understanding of Milo, let’s look into the SWOT Analysis of Milo.
SWOT Analysis of Milo
Milo being the world’s leading and most trusted Chocolate Malt Beverage, carrying out a detailed SWOT Analysis of Milo helps in finding its strengths, weaknesses, opportunities and threats. Understanding internal strengths and weaknesses and external opportunities and threats. SWOT analysis helps in forming correct objectives and plans for the future.
So let us go ahead and first have a glance at the strengths of Milo from the SWOT analysis of Milo.
Strengths of Milo
Strengths represent everything that an organization is good at and why it sets them apart from the competition. They are the internal and positive attributes of any company. Milo’s strengths are:
- USP: Chocolate energy drink is the company’s only focus, which is one of their main strengths and their unique selling point.
- Variety of Products: Milo products are available in different shapes, sizes and types in the market providing multiple options for consumers to choose from.
- Distribution and Reach: Milo is a global brand, a brand that sells in countless countries. Nestle’s robust distribution network makes sure that Milo products are in the easiest and best possible way to the end consumers.
- Consumer Sales Promotion: The company carries out big sales, advertising and promotion, globally, in numerous countries.
- Value for Money: The products of Milo are of high quality and available at a reasonable price. The brand also offers cash discounts, seasonal interests and other offers occasionally.
Weaknesses of Milo
Weaknesses pull an organization back from performing at its best. They are the negative internal factors that weaken business strengths. A few drawbacks or weaknesses of Milo are:
- Product Design: In this world of constant change and the latest trends, the packaging of Milo products are outdated. The design of the tin box and labelling is old fashioned and has never been improved.
- No Diversity in Flavors: There is not much diversity in product flavours, just available in one flavour i.e. chocolate.
- Low R&D: Though the company is continuously looking into developing and enhancing its products, the company is still lacking innovation and the speed of improvement is quite slow.
- Limited Financial Backing: Nestle is not investing enough into Milo which causes it to fall behind its competitors.
- Weak and Damaged Brand: Because of multiple drawbacks and problems, they are losing the trust of their customers. As a result, Milo’s competitors have an advantage as customers are switching from Milo to other popular brands.
Opportunities for Milo
Opportunities are the factors that provide an organization with a chance to edge over others. They are the external factors that can contribute to the success of any company. Certain opportunities that Milo has:
- Health Awareness: Nowadays people are certainly more concerned about their health after the covid pandemic and a large number of diseases that have developed and risen in recent years. Milo being an energy drink, can help in increasing awareness about health and fitness in society.
(Nestle’s Milo organized ‘Back to Classes’ Programme After Pandemic, Source: Biz English)
- More Media Availability: With advancements in technology and the internet and with the wide use of social media around the globe, Milo can advertise, and promote its products and can also connect with customers, digitally, on different social media platforms.
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- Growing Fitness Industry: Milo, primarily an energy drink, can target customers and promote its products in such a way that it encourages people to drink their energy drinks to stay fit and healthy.
- Eco-friendly Products: Milo has started using an eco-efficient packaging approach for a few of its products but should fully jump on to take this opportunity to establish itself in the market as an environmentally conscious business, which would attract lots of customers.
- Sponsorships: Milo, associated with sports and fitness, should sponsor different sporting events across the globe to increase its brand awareness.
Threats to Milo
Threats are the factors that can affect an organization in a harmful way. These are the external factors over which no company has control. A couple of Milo’s threats are:
- Competitors: Milo’s competitors have increased in recent times, who produce and sell similar products as Milo. For instance Boost, Mozart etc. A few are well-known multinational brands that are luring away Milo’s customers.
- Latest Trends: Other brands in the market have diversity in packaging and design of their products, unlike Milo’s bottles, cans & pouches. They constantly change their brand and products with time and according to consumers’ needs.
- Tactics by Competitors: Other brands could use aggressive marketing tactics such as cutting prices and increasing promotion to attract more customers and sell their products, affecting Milo’s sales and customer loyalty.
Before we sum up the case study on the SWOT Analysis of Milo. Let us have a look at their competitors and an example of any backlash faced by the company from users.
Top 5 Competitors of Milo
- Yoke Food Industries: It was established in June 1993. YFI is located in Senai Technology Park in Senai, Malaysia. It has a total production capacity of 75000 cans per hour which includes all kinds of Asian drinks like soya bean drink, herbal tea, etc.
- Red Bull: Red Bull is an Austrian company that makes energy drinks and can also be seen sponsoring some of the extreme sports performed by people. Red Bull was the most popular energy drink brand in the year 2020.
- Bonda Global is a Kuala Lumpur-based company founded in 2015.
- DC Lab is a Malacca-based company which was founded in 2021. It is an Unfunded company.
- Blue Red Pink is a Shah Alam-based company founded in 2019.
Example of a Failed Campaign Or Backlash from Consumers
In an article for Daily Mail, Australia Sahil Makkar posted ‘Nestle changed Milo recipe back to original after customers commented that the new healthier version was less chocolaty.’
- What was the issue?
Four years before this article, Nestle had changed the original recipe to get better improvement in the health benefits of the product. They added ingredients like vitamins D, B3, B6, B12. It resulted in affecting the chocolaty taste of Milo. The company ignored the feedback at that time.
- What backlash did the company face?
Nestle ought to improve the health benefits of the product with the addition of vitamin D, B3, B6, B12, vitamins A, B1 and magnesium also removing the vanilla flavouring. The consumers were not happy with the change and even started labelling the product as gross and disgusting. The company spokeswoman announced about not changing the recipe back then despite the complaints. It dropped the 4.5-star health rating for Milo after health experts pointed out Nestle for tricking customers into thinking the new formula was healthy.
- What did the brand do in that situation?
The Nestle business manager Anna Stewart had mentioned the company did get feedback from people in New Zealand who missed the old taste of Milo. So, they had to bring the 80-year-old recipe into practice.
This ends our elaborated SWOT analysis of Milo. let us conclude our learning below.
We already know that Milo is one of the biggest producers of chocolate flavoured powder products in the whole world. It produces products that meet people’s expectations and needs. Today Milo has captured markets of over 50 countries. 34 Million cups of Milo powder and 3.7 Million servings of ready to drink are enjoyed each day and that’s no myth!
But being such a huge brand serving chocolate flavoured powder products across multiple countries, Milo should continue to innovate and develop more products and launch them in the market with the best possible marketing strategies.
Especially digital marketing which is vital in today’s growing and expanding world, to get better results and to remain competitive in the market. If you don’t have any idea of what digital marketing is or want to learn more about it and upgrade yourself, here is IIDE’s 3 Month Advanced Online Digital Marketing Course to know more.
We hope this blog on the SWOT analysis of Milo has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.
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