Introduction Nestle SA , the worlds leading food manufacturer and the market leader in both coffee and mineral

water, produces a wind range of products including prepared dishes and cooking aids, milk-based products, cereals, instant coffee, pharmaceuticals and baby foods. Nestle SA is a publicly owned company, with subsidiaries across the world. It website addresses in 104 countries. It is also the world largest food and beverage company with $71 billion in annual sales and almost 230,000 employees around the world. It markets some 8000 brands that include instant coffee. Remarkably, its products are sold in every country in the world, including in North Korea. Nestle coat of arms, the birds nest, which refers to his name, has become a symbol for the products being a safe care for their consumer product safety and quality. Research and development based innovation capacity and strong brands are priority for Nestle. Objective of Nestle Nestle business objective is to manufacture and market its products in a way that creates value that can be sustained over the long term for shareholders, employees, consumers, business partners and national economies in which Nestl operates. The aim of the creating values for the company include with improve business condition for the firm. To obtain more reliable and high qualify source of raw materials, improved government functioning and regulatory, employed skill and loyal workforce and superior quality products which successfully complete .

Nestle Corporate Philosophy Be the leading multinational company in food, nutrition and wellness.
Produce and sell world-class products of the highest consistent quality, reliability and convenience based on business excellence principles throughout o u r operations. Maximizes the use of good quality local raw materials. Be an exemplary employer with a progressive human resource and social policy; with a management style that is based on "Management Commitment and People Involvement" Be a responsible corporate citizen, fulfilling all obligations to g o v e r n m e n t , shareholders, customers, communities and consumers. Protect the environment by being committed to environmentally sound business practices and taking into account the need to preserve natural resources and save energy. Guarantee that all products manufactured, imported and distributed by Nestl Malaysia are certified HALAL by authorised Islamic certification bodies. Deliver shareholder value through the achievement of sustainable and profitable longterm growth.

Nestle Marketing strategy

The firm applied a progressive human resource and social policy, w i t h a management style that is based on management commitment and people involvement. Moreover, the firm had responsible corporate citizen, fulfilling obligation to government, share holders, customers, communities and consumers. Protest the environment by being committed to environmentally sound business practices and taking into account the need to preserve natural resource and save energy. For example, guarantee that all products manufactured, imported and distributed by Nestle Malaysia are certified HALAL by authorized Islamic certification bodies. Perhaps, the firm delivered shareholder value through the achievement of sustainable and profitable long-term growth. Its a wide area research the branding. Branding strategy is corporate. Part of the branding strategy is the brand plan for each product. This is an integrated strategy. The brands of Nestle area key strength but the executive levels are very aware today that brands alone are not enough to win. From its beginning, Nestle developed its business internationally and became aware of the fact that food products have to be closely linked to local eating and social h a b i t . T h a t i s w h y N e s t l e f o r m t h e v e r y s t a r t h a s a l w a y s s h o w n r e s p e c t f o r d i v e r s e cultures and traditions. Nestle activities to integrate itself as much as possible into the cultures and traditions where it is present, adding also to the local environment its own set of values. Therefore, Nestle embrace cultural and social diversity and does not discriminate on the basis of origin, nationality, religion, ra c e , g e n d e r o r a g e . Furthermore, Nestle believes that is activities can only be of long term benefit to the company if they are the same time beneficial to the local community. Precisely, the environment is changing very rapidly and in particular customers are looking for answer to their concerns. To our opinion, global thinking and strategies can best be expressed through l o c a l a c t i o n a n d c o m m i t m e n t a s s h o w e d a s N e s t l e M a l a y s i a . A n d o f c o u r s e , N e s t l e applied think globally act locally as well as thinking out of the box idea in their product and distribution with the help of strategic global marketing.

Introduction to Milo
Milo is a milk beverage with chocolate and malt, p r o d u c e d b y Nestl and originating from Australia. I t w a s d e v e l o p e d b y Thomas Mayne i n 1 9 3 4 . M i l o is also manufactured in other countries, including Singapore,Malaysia,China,Thailand,Indonesia,Philippines,Vietnam,New Zealand , H o n g K o n g , India, Japan, Jamaica, Trinidad & Tobago, Chile, Colombia, Peru, Nigeria, Kenya, Ghana, Papua New Guinea, South Africa, SriLanka , Syria and Taiwan. The name derives from the famous Greek athlete Milo of Crotona , after his legendary strength. Milo is added to hot or cold milk to give it a malted chocolate flavor and extra texture. When combined with cold milk, it retains the gritty texture of its raw state. Milo can be stirred into steamed milk or hot water to create something similar to hot chocolate or cocoa. Sugar can be added to the Milo beverage, but many people enjoy it without the addition of sweeteners, appreciating it for its subtle chocolate flavor. Another possible use is making a normal cup of cold Milo and microwaving it for approximately 4060s e c o n d s . T h i s g i v e s t h e M i l o d r i n k a biscuit cover on top. Another popular use is to sprinkle it on ice cream, e s p e c i a l l y v a n i l l a i c e c r e a m . M i l o c a n a l s o b e s p r i n k l e d o n breakfast cereals. Milo is often the favored beverage for the Tim Tam Slam. A l s o v e r y p o p u l a r i s the "Magic Milo" which involves adding Milo to a small amount of milk with sugar and whipping it to increase the amount of air in the milk, thereby doubling it in size. Then one adds small amounts of hot water and milk in layers stirring each new layer vigorously to maintain its lightness. A final layer

o f w h i p p e d cream topped with extra Milo or chocolate sprinkles. This is more of a 'warm' beverage rather than a 'hot' one and is a more popular version of hot Milo for children. M i l o m a n u f a c t u r e d o u t s i d e Australia i s c u s t o m i z e d f o r l o c a l m e t h o d s o f preparation. In Ghana, Malaysia, the Philippines, Singapore and Indonesia, it is mixed w i t h h o t o r c o l d w a t e r i n s t e a d o f m i l k , w i t h t h e i n s t r u c t i o n s " A d d m i l k a n d s u g a r i f desired. "Other countries the packaging is green and has people playing sports on the tin. There is an organization called "Milo Cricket" which operates in m o s t a r e a s b y volunteers, children participating are given small packets of Milo to eat or drink. The commercials and taglines are "Go and go and go with Milo" and a popular commercial is4 generations of women on a skipping rope singing "and my mum gave me Milo to go a n d g o a n d g o " a n d t h e l i n e " I n e e d m y M i l o T o d a y " , b e c a u s e i t h a s a l o w glycemic index. The packaging of Milo tins in Singapore are also green and also have people playing sports on the tins. M i l o i s v e r y p o p u l a r i n Malaysia, w h e r e t h e b r a n d n a m e i s s y n o n y m o u s w i t h chocolate flavored drinks: Milo has a 90% market share in Malaysia (not t h e o f t e n quoted 90% worldwide share of Milo consumption) , and Malaysians were said to be the worlds largest consumers of Milo. This is because Milo was once used as a nutrient supplement when it was first introduced in the country, and has thus gained a reputation as a 'must have' drink for the old and the younger generations. Milo manufactured in Malaysia is made to dissolve well in hot water to produce a smooth hot chocolate drink, or with ice added for a cold drink. Milo in Malaysia is served in kopitiams and mamak stalls offering versions such as "Milo Dinosaur " (a cup of Milo with an extra spoonful of powdered undisclosed Milo added to it), "Milo Godzilla" ( a c u p o f M i l o w i t h i c e c r e a m a n d / o r t o p p e d w i t h w h i p p e d c r e a m ) a n d " N e s l o " ( c o m b i n e d w i t h Nescafe powdered coffee). It gained popularity in Singapore soon after.

Product Life Cycle

At Nestl, they apply a product life cycle approach involving their partners from farm to consumer in order to minimize the environmental impact of their products and activities. Their aim at all stages of the cycle is to use natural resources efficiently, to favor the use of sustainable-managed renewable resources and to target zero waste. In this way, they intend for their brands to stand for environmental sustainability. Nestl's initiatives aim to improve the environmental performance of the products along their entire life cycle. These include sourcing sustainable raw materials, reducing energy consumption and minimizing air emissions by moving to different fuel types. Nestl i n v e s t s a n a v e r a g e o f C H F 4 0 m i l l i o n a y e a r t o r e d u c e i t s air emissions. Another significant step in the value chain is transport. Nestl has initiated a pilot with Schenker, an international logistics company, to evaluate the effect of different types of transport, distances driven and fuel type used. Through internal research and development at Nestl there have also been significant advances in the environmental i m p a c t o f refrigerants and packaging. Without compromising product quality there was a reduction of 392 000 tones of packaging material between 1991 and 2008.

The Marketing Mix of Nestle Marketing

The following consideration included in our marketing analysis of the Nestle. Product Place

 Promotion Price 1. Product Product item Nestl seeks to earn consumers confidence and preference and to follow and anticipate consumer trends, creating and responding to demand for its p r o d u c t s . Therefore Nestl is driven by an acute sense of performance, adhering to and favoring the rules of free competition within a clear legal framework. We choose Milo since it is a brilliant example of where as the superior quality, patented technology and basically selling directly to consumers and this whole business is growing rapidly. Milo has been around for decades, and it is one of Malaysian favorite chocolate m a l t d r i n k t o everyone. Malaysia also is the worlds largest consumers of Milo.

Product item depth

Milo is a very well known product and Milo also has variety of product items under the same brand which is Milo. These are the type of Milo that Nestle have been produce.

The original Milo

The original Milo contain nutritional icon on each pack reinforces the nutritional properties that consumer can get f r o m e v e r y c u p o f n u t r i t i o u s a n d great-tasting Milo

Nutrition in Milo
Right balance in nutrition
Milo provides energy (calories). These calories come from the d i f f e r e n t ingredients of Milo, mainly malt extract, skimmed milk, palm oil and sugar. If consumed moderately, as part of a balanced diet, Milo provides the energy required for an active l i f e s t y l e a n d w i l l n o t b e f a t t e n i n g . O n i t s o w n , M i l o p o w d e r i s n u t r i t i o n a l l y b a l a n c e d , providing the right ratio of protein, carbohydrates and fats. The 6 basic classes of nutrients in food are: carbohydrate, fats, protein, vitamins, minerals and water! A mug of Milo of drink contains these nutrients. Protein is one of the macronutrients (along with carbohydrate and fats) that is important to build and repair body tissue. It is essential for healt h y g r o w t h a n d development. The protein needs (per Kg of the body weight) is highest when growth is rapid, such as during infancy, childhood and adolescence. Sources: Protein is found in meat, fish, poultry, dairy products, beans, peas and lentils. Fats are essential component of body cells that are important for the absorption of fat soluble vitamins. As fat contain higher calorie compared to carbohydrates and protein, excessive fat intake may also contribute to overweight and obesity problems. Sources: Fats are found in animal and dairy products, as well as vegetables oils and margarines.

Energy
Carbohydrates supply the main source of energy for the body. Carbohydrates can be in the form of complex and simple carbohydrate. Simple c a r b o h y d r a t e s a r e sugars that our body can easily and quickly use for energy. Complex carbohydrates are chains of sugar units. For example, fiber and starches. Starches are broken down during digestion into glucose before being absorbed into the body. Fibers are not digested by our body, though it helps to regulate bowel function. Sources: sugars, starch (e.g. grains, potatoes) and fiber (e.g. fruits, vegetables).W h a t i s B M R ? B a s a l m e t a b o l i c r a t e ( B M R ) i s t h e e n e r g y u s e d to carry out

necessary body activities such as breathing, regulating body tem p e r a t u r e , a n d maintaining a heart beat. Energy balance is the key to weight management. It has to do with energy intake and energy output. Energy intake is the number of calories we gain from food. Energy output is the number of calories you use for BMR and activities. Imbalance of energy will result in weight gain and weight loss.

Atigen-E(vitamin and mineral)

Here are two main groups of nutrients: macro-nutrients and micronutrients. Macro-nutrients are those that are needed in large quantities ( t e n s o r h u n d r e d s o f grams) every day. These are carbohydrates, protein and fats. Micronutrients are those needed in small quantities (micrograms or milligrams). These are vitamins and minerals. Vitamins are micronutrients essential to the human body. A deficiency of some vitamins can lead to diseases or metabolic disorders. For example, lack of vitamin C can lead to scurvy; lack of vitamin D lead to rickets.

2. Place
Place relates to decisions about the storing and transporting of products, and also about selecting the products channel of distribution. These decisions are critical to the success of an organization. Effective inventory management drives down costs and enhances product quality. Choosing the right distribution channel (i.e. should we sell through middleman firms or should we sell directly to the end-user) Direct energy cost pressures have eased in recent months. The major distribution channel include with geographically consideration with the manufacturing place situated. Its v e r y c o s t effective way for the firms expenses in distribution its products to targeted market. HEAD OFFICE UNIT Fax : 03-7965 6767 Nestl (Malaysia) Berhad Nestl House, 4 Lorong Persiaran Barat46200 Petaling Jaya,Selangor Tel : 03-7965 6000 National Distribution Centre Lot 1, Persiaran Waja Kawasan Perindustrian Bukit Raja,41050 Klang, Selangor Tel : 0333447850Fax : 03-33436171 BRANCH ADMINISTRATION OFFICES & AREA SALES OFFICES PENINSULAR MALAYSIA Kuala Lumpur BranchNestl Products Sdn BhdLot 14, Jalan Delima 1/1Subang Hi-Tech Industrial Park,Batu Tiga40000 Shah Alam, Selangor Tel : 03-56297000Fax : 03-56297154Johor Bahru BranchNestl Products Sdn Bhd4th & 5th Floors, Bangunan Petronas,Bandar Baru UDA,Jalan Skudai81200 Johor Bahru, Johor Tel : 07-2334500Fax : 07-2334600/2334670Penang BranchNestl Products Sdn BhdTingkat 12, Wisma TNBNo. 30, Jalan Anson,10400 Pulau PinangTel : 04-2381700Fax : 04-2381898Kuantan BranchNestl Products Sdn BhdNo. 23, Jalan Gambut 2P.O. Box 162,25720 Kuantan,PahangTel : 09-5118600Fax : 09-5118798/5118799 EAST MALAYSIA Sabah BranchNestl Products Sdn BhdLevel 4 (3rd Floor) Wisma 202018Sandakan Area Sales OfficeNestl Products Sdn Bhdc/o Harrisons Trading (S) Sdn Bhd alan Belia 88100 Kota Kinabalu, SabahTel : 088-243030Fax : 088-237498Tawau Area Sales OfficeNestl Products Sdn Bhd4th Floor, Man Tong Shing BuildingTB 20,Jalan Dunlop, Tawau, SabahTel : 089-776365Fax : 089-753211Miri Area Sales OfficeNestl Products Sdn BhdLot 1894, Block 4Miri Concession Land District,Piasau Industrial EstateJalan Dtk Patinggi Hj Abd

Rahman Yakub98000 Miri, SarawakTel : 085-653054 / 663415Fax : 085-6616482nd Floor, 20 Jalan Tiga90000 Sandakan, SabahTel : 089-223201Fax : 089-225498Sarawak BranchNestl Products Sdn BhdMenara MAA, Level 7Jalan Ban Hock / Central Timur,93100 Kuching, SarawakTel : 082-235918Fax : 082-417066Sibu Area Sales OfficeNestl Products Sdn BhdLot 480, Jalan Then Kung Suk, Upper Lanang,P.O. Box 131996008 Sibu, SarawakTel : 084-214672 / 213064Fax : 084-214727 FACTORIES Nestl Foods (Malaysia) Sdn Bhd PetalingJaya25,Jalan TandangP.O. Box 8081, Pejabat Pos Kelana Jaya46781 Petaling JayaSelangor Tel : 03-77811822Fax : 03-77813823Nestl Foods (Malaysia) Sdn Bhd BatuTigaJalan Playar 15/140000 Shah Alam, Selangor Tel : 0355195333Fax : 03-55106263Nestl Foods (Malaysia) Sdn BhdChembongJalan Perusahaan UtamNestl Foods (Malaysia) Sdn Bhd ShahAlamShah Alam ComplexJalan Playar 15/1P.O. Box 701040700 Shah Alam, Selangor Tel : 03-55195333Fax : 03-55102028Nestl Foods (Malaysia) Sdn Bhd RajaMudaShah Alam ComplexJalan Playar 15/1P.O. Box 701040700 Shah Alam, Selangor Tel : 03-55195333Fax : 03-55102028

Product positioning
Having decided its corporate objectives and strategy, Nestl can set marketing objectives for each of its product, in this case an individual product which is Milo. The primary objective for Milo is to maintain its position as the Malaysias number one selling chocolate malt drink brand. In order to achieve this, Nestl has to develop a marketing strategy that will take into account all the elements of the marketing mix. This will involve individual strategies for pricing, product development, promotion and distribution. Since Nestle Milo is an established brand name, these strategies must be flexible and relevant to each new generation of consumers, but at the same time, great care must be taken not to damage the perceptions of the product built up over decades of marketing.

Product transportation
Methods have been developed to ensure that vehicles, containers etc are used in the most efficient way. Examples of initiatives include the development of Opal, a software tool to assess and recommend pallet layouts. This led to a significant reduction in numbers of pallets, and therefore vehicles and journeys. Paper board slip sheets and innovative pallet designs have also improved load utiliz ation, as has the development of dual temperature vehicles enabling consolidation of deli v e r i e s o f products such as ice cream and confectionery.

3. Promotion
Few good or services, no matter how well developed, priced or distribut e d , cannot survive in the marketplace without effective promotion which is a communication by marketers that informs, persuades and reminds potential buyers of a product in order to influence their opinion. Promotional strategy is a plan of optimal use of the elements of promotions that is used by Nestle to promote Milo. The main function of Nestle promotional strategy is to convince target customers that their goods and services offered provide a differential advantage over the competition. A differential advantage is a set of unique features of a c o m p a n y a n d i t s p r o d u c t t h a t

a r e p e r c e i v e d b y t h e t a r g e t m a r k e t a s s i g n i f i c a n t a n d superior to the competition. Such features can include high product quality, low prices, excellent service or a feature not offered by other competitor. As e x a m p l e , M i l o convinced their customer that children will be more energetic if they consume Milo. They also effectively communicate this differential advantage through advertising featuring Malaysia top national athlete such as Datuk Nicol Ann David. Nestle carries their promotional effort trough traditional mass media such as television, radio, newspaper and etc. With the increasing fragmentation of traditional mass media choices, Nestle also sending their advertisements to consumer in many new and innovative ways, such as with interactive video technology located in departmental stores and supermarkets and through Internet Web. Beside the promotion or communication above, Nestle are also using other form of advertising such as non-media communication or advertising. Some of the ways that Nestle have done are by participating exhibitions, sponsorship activities, public relations and sales promotion such as giving freebies with good, or reduced price offers on Milo p r o d u c t . T h o s e a r e t h e t o o l s t h a t u s e d b y N e s t l e t o p e r s u a d e c u s t o m e r a n d b u i l d customer relationship with their product. Nestle does not emphasis too much in attracting competitors customers since 90% Malaysian consume Milo. Advertising Advertising is defined as any paid form of product information that is delivered to potential customers in a non-personal way (such as through newspapers, magazines, television, radio, billboards, or the Internet). The communication is not j u s t a b o u t advertising only, and the communication often creates a creative slogan in order to make sure consumer will remember Milo. Type of Advertising Media used by Nestle Television Nestl applied this source for Milo product, which in the commercial break is about a boy or a girl that are more energetic in their daily live if after they consume Milo. Also shown in the commercial break is the boys parent provide Milo for their children. This strategy is to attract the consumers especially children and parents to buy this product. Outdoor media Nestle Milo is well known for their commitment and sponsorship efforts for any s p o r t events in Malaysia especially for any primary and secondary school. Milo sponsors almost all type of sport event and Nestle also collaborate with Ministry of Sports and Youth in order to organize national and international sport event. They normally open a booth in every event they sponsored and giving out free Milo drinks. It is really effective since it can instill relationship between product and consumers. Internet Nestle have their own website which is www.nestle.com and there are more than100 countries are registered under this website. Nestle also have their own website for each countries that is under Nestle including North Korea and Israel. Uniquely, Nestle also have their own website for each product that they s ell (e.g. www.milo.com.my) w h i c h i s e s t i m a t e d a r o u n d 3 0 , 0 0 0 p r o d u c t s w o r l d w i d e . I t i s established so that consumer can easily find information about their particul

a r product and also as a medium for consumer to leave their suggestion in order for Nestle to improve their product

FREE 1 MILO sporty tumbler with every purchase of MILO 1kg pack.

This promotion will attract sporty person to buy it. This is because the tumbler is easy to carry everywhere and it is very fit to sporty person that have to move a lot.

4. Price
The firm has several options for addressing the price. Domestically Nestls Milo manufactured finished products may be force to switch to offshore sourcing of certain component to keep costs and prices competitive. Another factor is a through audit of the distribution structure in the target markets. An extension or ethnocentric pricing policy describe that the per-unit price of an i t e m t o b e t h e s a m e n o m a t t e r w h e r e i n t h e w o r l d t h e b u y e r i s s i t u a t e d . N e s t l s executive level monitor consciously on the freight and import duties according to the Malaysia market. Adaptation or polycentric pricing policy allows subsidiary or affiliate managers or independent distributors to establish whatever price they feel is most desirable in their circumstances. The firm utilizing independent distributors were the most likely to apply polycentric pricing. This type of approach is sensitive to the local market. The disadvantage facing in the company is local managers are free to price in the way they see fit, they did not fully informed about company experience when they set prices. The price harmonization from headquarter is necessary in dea l i n g w i t h international accounts. The management level consciously and systematically seeks to ensure that accumulated national pricing experience is influenced and applied wherever relevant. The organizations revenue represented that the food and beverage like Milos product gain more return on investment than other. It represent that the pote n t i a l sustainable growth market for the firm. Price strategy Price strategy is a basic, long-term pricing framework, which establishes the initial price for a product and the intended direction for price movements over the product life cycle. It consists of 3 type of pricing strategy which is Price skimming, Penetration pricing and Status quo pricing .Nestle Malaysia currently practicing penetration pricing to market Milo which is away where Nestle charges a relatively low price for a product (Milo) initially as a way to reach the mass market.

Segmented and Target Market

A market segment consists of a group of customers who share a similar set of wants. The marketer does not create the segments; the marketers task is to identify the

segments and decide which one (s) to target. Segment marketing offers several benefits over mass marketing. The company can create a more fine-tuned product or service offering and price it appropriately for the target segment. The company can more easily select the best distribution and communications channels, and it will also have a clearer picture of its competitors, which are the companies going after the same segment. Our market segment is based on our observation; analysis as well as we is in Nestle shoes. The customers can be classified according to the following variables: 1. Geographic Segmentation: Regions: Commonly people prefer to drink Milo throughout the year. But Nestle can segment the market on the basis of season. The consumption of cold Milo goes down during the rainy season as people prefer to have hot Milo. In hotter regions the consumption pattern doesnt change much. Cities: C o n s u m p t i o n o f M i l o i s m o r e i n t h e c i t i e s a s c o m p a r e d t o t h e villages due to various factors such as income and education level. Nestle should focus more on making Milo available in the every places where people are willing and able to buy. 2.Demographic Segmentation: Age: Nestle can easily target various age groups. The most important of these groups are children and old people. For children it can introduce Milo with additional nutritional contents such as vitamins and minerals. For older people it already has clinical nutrition. It just needs to get its product known among these people. Gender : It will be very beneficial to target women as they usually shop for their family. If they are convinced that the Milo will be good for their families, they will purchase. Income and occupation: People will buy Milo when they have enough monetary r e s o u r c e s . N e s t l e s h o u l d t a r g e t p e o p l e i n t h e h i g h e r i n c o m e g r o u p s . People with blue collar jobs can be targeted by telling them that the Milo will help them in their daily routine. Life cycle stage can also be important because families with younger kids will want to buy Milo. 3.Psychographic segmentation: Social class and life style: People belonging to the higher social classes t e n d t o s p e n d m o r e o n l u x u r i e s a s compared to people in the lower classes. Such people can be easily targeted as they are very health conscious. Nestle can urge these people to buy Milo w h i c h i s r i c h i n nutrition. Personality: People who are outdoorsy and are involved in sports can also be targeted by tagging the brand with some sport celebrity.