Sania Hasan Stratagic Project

Assignment No. 1:

International Planning

Submitted By: Sania Hasan Submitted To: Sir Ismail Ramay Rana Subject: Strategic Marketing Date: 22-10-08 Signature:

Fatimah Jinnah Women University

Nestle is the company which is introducing new chocolate to Germany. So following steps are required:

Phase 1:Preliminary analysis and screening. (1) Company character: History: The Company dates to 1867, when two separate Swiss enterprises were founded that would later form the core of Nestlé. In August of that year, Charles A. and George Page, brothers from the United States, established the Anglo-Swiss Condensed Milk Company in Cham, Switzerland. In September, in nearby Vevey, Henri Nestlé developed a milk-based baby food and soon began marketing it. In 1877 AngloSwiss added milk-based baby foods to its products, and in the following year the Nestlé company added condensed milk, so that the firms became direct and fierce rivals.The 1920s saw Nestlé's first expansion into new products, with chocolate the company's most important activity.

Objectives: (a) (b) (c) (d)

Nestlé's business objective is to manufacture and market the Company's products in such a way as to create value that can be sustained over the long term for shareholders, employees, consumers, and business partners. Nestlé does not favor short-term profit at the expense of successful long-term business development. Nestlé recognizes that its consumers have a sincere and legitimate interest in the behavior, beliefs and actions of the Company behind brands in which they place their trust, and that without its consumers the Company would not exist. Nestlé continues to maintain its commitment to follow and respect all applicable local laws in each of its markets.

Resources: Revenue

US$ 121.103 Billion

Operating income

US$ 16.917 Billion

Profit

US$ 11.990 Billion

Total assets

US$ 129.106 Billion

Total equity

US$ 61.067 Billion

Designation in the organization: The executive board, a distinct entity from the board of directors, includes: (1) Paul Bulcke, Nestlé CEO (2) John J. Harris, EVP, Chairman, and CEO of Nestlé Waters (3) Lars Olofsson, EVP of Strategic Business Units and Marketing (4) Francisco Castañer, EVP of Pharmaceutical and Cosmetic Products, Liaison with L'Oréal, Human Resources (5) James Singh, EVP of Finance, Control, Legal, Tax, Purchasing, Export (6) Richard T. Laube, Deputy EVP of Nutrition Strategic Business units. Current members of the board of directors of Nestlé are: Günter Blobel, Peter Böckli, Daniel Borel etc

Products: Nestlé has a wide range of products across a number of markets including coffee, water, other beverages, ice cream, infant foods, performance and healthcare nutrition, seasonings, frozen and refrigerated foods, confectionery and pet food, Baby food, coffee, dairy products, breakfast cereals, confectionery and many .

(2) Home country constraints: Political: Political situation of Pakistan is being decreasing due to the reason of self interest of the politicians. Now days politically Pakistan is not so strong due to change of government by people’s party.

Culture: Pakistan has a rich and unique culture that has preserved established traditions throughout history. Many cultural practices, foods, monuments, and shrines were inherited from the rule of Muslim Mughal. The national dress of shalwar kamiz is originally of Central Asian. The variety of Pakistani music ranges from diverse provincial folk music and traditional styles such as Qawwali. There are many festivals celebrated annually e.g. Pakistan Day, Ramadan, and Eid ul-Fitr etc.

Economic: Pakistan is a rapidly developing country; its economic growth rate is 7 percent per annum for four consecutive years up to 2007. Despite being a very poor country in 1947, Pakistan's economic growth rate was better than the global average during the subsequent four decades, but imprudent policies led to a slowdown in the late 1990s. Recently, wide-ranging economic reforms have resulted in a stronger economic outlook and accelerated growth especially in the manufacturing and financial services sectors. Pakistan's annual growth rate was to be calculated at 4.9%.

(3) Host country constraints: Economic: Germany is the largest national economy in Europe, the third largest by nominal GDP in the world, and ranked fifth by GDP (PPP), its growth rate in 2007 was 2.4%. Since the age of industrialisation the country has been motor, innovator and beneficiary of an ever more globalized economy. The overall unemployment rate has consistently fallen since 2005 and reached a 15-year low in June 2008 with 7.5%. Germany is the world's leading exporter of goods in 2007.

Political: The Judiciary of Germany is independent of the executive and the legislative branches. Germany has a civil or statute law system that is based on Roman law with some references to Germanic law. Germany's supreme court system, called Oberste Gerichtshöfe des Bundes, is specialized. For civil and criminal cases, the highest court of appeal is the Federal Court of Justice. The German penal system is aimed towards rehabilitation of the criminal; its secondary goal is the protection of the general public.

Level of Technology: Germany maintains an excellent science and technology educational system and vocational training in many fields. There are independent laboratories, comprised of both the national laboratories and private research institutes. The country has numerous specialized learned societies concerned with agriculture and veterinary science, medicine, the natural sciences, and technology. So over all technology of Germany is rising day by day.

Culture: Germany is historically called “Das Land der Dichter und Denker” (the land of poets and thinkers). Since 2006 it names itself “Land of ideas”. From its roots, culture in Germany has been shaped by major intellectual and popular currents in Europe, both religious and secular. There are 240 subsidised theatres, thousands of museums and over 25,000 libraries spread in the 16 states. These cultural opportunities are attended by over 91 million people who visit German museums every year. Germany claims some of the world's most renowned classical music composers.Numerous German painters have enjoyed international prestige through their work in diverse artistic currents.

Structural distribution of states: Germany comprises 16 states, which are further subdivided into 439 districts and cities.

Geography: The territory of Germany covers 357,021 km2 (137,847 sq mi), consisting of 349,223 km2 (134,836 sq mi) of land and 7,798 km2 (3,011 sq mi) of water. It is the seventh largest country by area in Europe and the 63rd largest in the world.

Climate: Most of Germany has a temperate seasonal climate in which humid westerly winds predominate. The climate is moderated by the North Atlantic Drift. Consequently in the north-west and the north, the climate is oceanic; rainfall occurs year round with a maximum during summer. Winters there are mild and summers tend to be cool. In the east, the climate is more continental; winters can be very cold, summers can be very warm, and long dry periods are often recorded. Central and southern Germany are transition regions which vary from moderately oceanic to continental.

Phase 2:Adapting the marketing mix to target markets: 1. Product: Brand name: Our brand name which we are internationally planning to Germany is “Vonka Chocolate”. Its logo is “A healthy chocolate with full of nutritious value”

Features: The characteristics of our chocolate are that it contains all nutrients which are essential to have a complete diet. It is created according to the foreign customer’s mood. We produce our all chocolate flavors in both forms: with milk and without milk chocolates. We produce chocolates which has least chemicals and artificial flavors. It is healthy for every age group and ingredients used in it are socially acceptable.

Packaging: It has a very attractive and bright colour packaging. Chocolate has been packed in an air locked plastic over which fine box of brown and yellow colour is being used. So that to remain its taste and flavor for longer period of time.

Warranty: It is a durable chocolate and can be used for a longer time, but if stored in refrigerator. Any fault find in the chocolate would be replaced immediately.

Style: It has a different style to which every customer can be easily be attracted. i-e shape of the chocolate.

2. Price: Discount: Discount will be given within 15 days between 5%-10%.and 25% discount will be given in summer season.

3. Promotion: Following promotional activities will be used for the promotion of “Vonka chocolate”:

Advertising: Through magazines

.

Personal selling: Selling the product door to door to attract more customers.

Message: Message of this product will be delivered through brochures and pamphlets.

Sales promotion: It involves using money off coupons or special offers, like buy one get one free.

Media: Short advertisements will be used to famous our chocolate.

4. Distribution: Channels: We will try to supply as many outlets as possible- both wholesaler and retailer channels.

Transportation:

Transportation will be through air conditioned vans.

Phase 3:Developing the marketing plan. 1. Situational analysis: Company can easily internationally plan chocolate to Germany. As there are all types of weather conditions. Moreover their economic and legal activities are also fine. Company can make quiet good relationship with her.

2. Objectives and goals: • • • • • • •

To recognize the needs of various markets. To get confidence of parents and their children to buy the healthy alternatives to chocolates. To cater for the health conscious and contribute towards a balanced nutrition. To provide a palatable and satisfactory alternative chocolate to its customers. To cover at least 25% market share. Customer satisfaction. Prompt and efficient deliveries.

3. Strategy and tactics: Lowering the price, discount coupons in school will be given to attract the children. Prize slip system in some chocolates can be introduced to increase sales.

4. Budgets: 7 to 8 crore budget has allocated for the production and delivering to Germany per month.

5. Actions programs: Programs such as get 1 get 1 free and lowering price usually in summer season will be used.

Phase 4:Implementation and control: 1. Objectives of each promotional activity: Advertisements: Objective of the advertisement is too aware the people about our chocolate so that they will know about uniqueness of our chocolate.

Magazine: Through magazines we will aware people about the nutritious value of our chocolate.

Door to door service: The objective of the door to door service is to give information and special offers to our customers and get their views about chocolate.

2. Standards: Standard of the chocolate are checked by detective supervisors.

3. Assign responsibility: Different managers have been assigned responsibility to check the quality, management and distribution of chocolate.

4. Measure performance: The analysis shows that Vonka chocolate company has enable to achieve its set objectives. Company is enabling to control the desired market share. I-e desired market share was 25% and achieved market share is 16%. Its annual sales record is up to the average of company’s aim.

5. Correct for error: The analysis of average sales shows that customers are not well known by our Vonka chocolate which means promotional activities are not up to the mark. To control the given problem we have to increase our promotional activity and increase our budget for promotion purpose and make our quality level

better and introduce new flavors of customer’s choice. Moreover company has to re-target the market and also find new markets to increase market share.