abhishreshthaa
Abhijeet S
Nestle S.A. is one of the largest food and nutrition companies in the world, founded and headquartered in Vevey, Switzerland. Nestle originated in a 1905 merger of the Anglo-Swiss Milk Company, which was established in 1866 by brothers George Page and Charles Page, and the Farine Lactee Henri Nestle Company, which was founded in 1866 by Henri Nestle. The company grew significantly during the First World War and following the Second World War, eventually expanding its offerings beyond its early condensed milk and infant formula products. Today, the company operates in 86 countries around the world and employs nearly 283,000 people
With its distinguished formula, NESVITA Pro-Digestion is supplemented with Actifibras, Nestlé's unique fiber combination developed through research and proven to help maintain healthy bowel functions and regulating intestinal activities. The newly developed milk brand is also enriched with calcium to contain double the amount than most other milks in the market and offers women (between 19 and 50 years) 50% the daily requirement of calcium amount needed compared to 25% of most of other brands.
"Nutrition experts recommend consuming a balanced diet rich in fibers for healthy bowel functions. Fiber - rich foods include bran, legumes, whole grain breads, fruits, vegetables and fiber supplemented foods such as NESVITA Pro - Digestion fat free milk with Actifibras. Consuming one glass of NESVITA a day along with a healthy and balanced diet helps improve intestinal functions and bowel activities thereby preventing bloating and constipation", explained Karine Antoniades, Market Nutritionist at Nestlé Middle East.
In addition to dietary fibers and extra calcium, NESVITA Pro - Digestion is supplemented with Vitamins C and E, important anti-oxidants for good nutrition. With its delicious vanilla flavor, NESVITA Pro - Digestion can be consumed as milk alone, enjoyed with coffee, tea or with cereals.
NESVITA is available on the shelves in Bahrain, Qatar, KSA, and the UAE and will be introduced to other countries in the region at a later stage.
"Nestle lays a huge weight on research and development. The Nestlé research center in Switzerland focuses on consumer needs in scientific research & development to innovate new products that meet consumers' expectations on taste, quality, variety and nutrition. NESVITA Pro-Digestion with Actifibras is the outcome of R&D studies that serves consumers characterized by health awareness. I am positive that NESVITA will provide new benefits that our consumers would appreciate", added Kumaran Nowuram, Business Executive Manager at Nestlé Middle East.
Market Summary:Refrigerated Foods
Based on market research, Nestlé's decided to launch Contadina
Contadina Fresh Past & Sauces rolled out nationally in 2nd half of 1988
Product launch was very successful:
$75 mil. Retail sales in 1988
$150 mil. Retail sales by 1990
Pasta line accounted for nearly 80% of sales volume
Market Summary:Refrigerated Foods
Given Contadina’s success, the NRFC began a product development process for a refrigerated pizza concept
The pizza market was an $18.4 billion market
By 1989 NRFC developed 2 new pizza concepts
Pizza Kit
Preassembled, heat and eat Pizza
Market Summary
izza
Pizza market Statistics:
88% of all pizzas sold by restaurants
60% of pizzas eaten at home
76% of all U.S. families had eaten restaurant pizza w.in past 6 months
Pizza consumption strongest in northern and eastern parts of U.S.
10,000(+) franchised pizza restaurants
25,000 pizza outlets
frozen pizza market more fragmented w/o clear market leader
Product Developmentizza Kit
Kit included:
12” crust
Sauce
Cheese
Sauce: Tomato or Pesto
Additional Toppings: Pepperoni, Sausage, 3-Cheese, Mushrooms & Bell Peppers (Sold Separately)
Serve 2-3 people
Market Research:Concept Test
Preliminary Concept test (200 Interviews)
Positive purchase intent was 58% (49% among males, 66% among females)
Results:
128 Heavy Take-out users(once every 2-3 weeks(+))
115 favorable to concept (out of which, 60 said they would buy Contadina instead of another product)
Market Research:Bases II Line Extension Study
Involved both Concept & in-home product use test:
Pizza Kit w/ Toppings Sold Separately
Pizza Kit only (No Toppings Sold Separately)
Determine the impact on trial kit by availability of separate toppings
Analyze Strengths and Weaknesses of both concepts
Pizza Kit
Product
Support either Pizza Kit with or without toppings
Pricing (NRFC expected factory pricing to be 2/3 of retail prices)
$6.39 for Kit
$1.29 for each additional Topping
Place
National distribution possible, could install a pizza line @ the Danville factory
Promotion (Total $18 mil.)
$9 mil. Advertising
$5 mil. Consumer Promotions
$4 mil. Trade Promotions
Target Market
95.5 Mil. Households
Contadina Pasta Users would Represent approx. 24%
MRD felt Parent Brand Penetration could range btw. 5%-25% (recommended volume projections be sensitive to this range)
Based on Promotion Plan, NRFC projected 37% overall awareness
Parent Brand Users likely to be more aware of Contadina name
NRFC Data on Consumer Awareness & Purchase Assumptions
Pizza Kit
Favorable to Pizza Toppings
50% would purchase toppings every time purchased kit
25% would purchase toppings ½ the time
Business Requirements for Pizza
$45 mil factory dollar sales
$12 mil project Investment costs
.3% share retail pizza market
Should NRFC launch a pizza product
Which option
How large market would they find
What market share could be achieved
Analysis:Volume Estimation
Analysis:Repeat Purchases
Analysisizza Toppings
Analysis:Revenue Estimation
Analysis:Sensitivity Analysis
5% Penetration
15% Penetration
Should launch Pizza Kit with Toppings
Require @ least 7% Market Penetration to meet Basic Business Requirement of $45 million factory dollar sales ($45,423,334)
Market Size
Market Share
Recommendations
Nestle should first work a lot to refine the taste of it’s pizza.
It should also lower the prices of its offerings.
Company should fine tune its manufacturing facilities before the product launch.
Post launch, company should use the same distribution network as it did for Pasta.
The product should also be supported heavily with huge advertising outlays.
What Happened?
1991-Nestle launches Contadina Pizza.
Positioned as a quick, convenient, yet fresh alternative to frozen pizza.
Pizza introduced in a kit format composing of a 12 inch refrigerated pizza shell, packed together with separate pouches of cheese and sauce.
What happened?
Toppings also were merchandized adjacent to the kit.
Toppings included pepperoni, three cheese blend and Italian Sausage.
Pizza kit was sold for $6.19
Toppings were priced at 1.49
What happened?
Product launched in selected cities.
Marketing support amounted to $11 million in 1991 and $10.5 in 1992.
Company faced disappointing results by not meeting any targets
Sold 4 million units in Year 1 that amounted to $13 millions in sales.
What happened?
Tried to improve the advertising themes by testing three more ads.
All these ads also failed in terms of recall.
Company maneuvered with price promotions but failed in this aspect.
Company had 60% spoilage on the toppings
What happened?
Abandoned the toppings
Sold pepperoni and cheese kit and a cheese kit at $5.99 and $5.49 respectively.
Company paid the price for relying on the pasta data that was in the initial stage.
“Pizza wars” also hampered the profits
What Happened?Marketscan: Americans Hunger for a More Homey Pizza, WSJ, June 29, 1993
1993
Kit sold for $5
Held 15% of the $170 mil-a-year market for refrigerated pizzas & pizza kits
Kraft introduced Boboli Shells
1997 – Nestlé sold Contadina to Del Monte
Excluded from sale was line of refrigerated pasta & sauces
Nestlé's changed name of refrigerated pasta and sauces to Buitoni
With its distinguished formula, NESVITA Pro-Digestion is supplemented with Actifibras, Nestlé's unique fiber combination developed through research and proven to help maintain healthy bowel functions and regulating intestinal activities. The newly developed milk brand is also enriched with calcium to contain double the amount than most other milks in the market and offers women (between 19 and 50 years) 50% the daily requirement of calcium amount needed compared to 25% of most of other brands.
"Nutrition experts recommend consuming a balanced diet rich in fibers for healthy bowel functions. Fiber - rich foods include bran, legumes, whole grain breads, fruits, vegetables and fiber supplemented foods such as NESVITA Pro - Digestion fat free milk with Actifibras. Consuming one glass of NESVITA a day along with a healthy and balanced diet helps improve intestinal functions and bowel activities thereby preventing bloating and constipation", explained Karine Antoniades, Market Nutritionist at Nestlé Middle East.
In addition to dietary fibers and extra calcium, NESVITA Pro - Digestion is supplemented with Vitamins C and E, important anti-oxidants for good nutrition. With its delicious vanilla flavor, NESVITA Pro - Digestion can be consumed as milk alone, enjoyed with coffee, tea or with cereals.
NESVITA is available on the shelves in Bahrain, Qatar, KSA, and the UAE and will be introduced to other countries in the region at a later stage.
"Nestle lays a huge weight on research and development. The Nestlé research center in Switzerland focuses on consumer needs in scientific research & development to innovate new products that meet consumers' expectations on taste, quality, variety and nutrition. NESVITA Pro-Digestion with Actifibras is the outcome of R&D studies that serves consumers characterized by health awareness. I am positive that NESVITA will provide new benefits that our consumers would appreciate", added Kumaran Nowuram, Business Executive Manager at Nestlé Middle East.
Market Summary:Refrigerated Foods
Based on market research, Nestlé's decided to launch Contadina
Contadina Fresh Past & Sauces rolled out nationally in 2nd half of 1988
Product launch was very successful:
$75 mil. Retail sales in 1988
$150 mil. Retail sales by 1990
Pasta line accounted for nearly 80% of sales volume
Market Summary:Refrigerated Foods
Given Contadina’s success, the NRFC began a product development process for a refrigerated pizza concept
The pizza market was an $18.4 billion market
By 1989 NRFC developed 2 new pizza concepts
Pizza Kit
Preassembled, heat and eat Pizza
Market Summary
izzaPizza market Statistics:
88% of all pizzas sold by restaurants
60% of pizzas eaten at home
76% of all U.S. families had eaten restaurant pizza w.in past 6 months
Pizza consumption strongest in northern and eastern parts of U.S.
10,000(+) franchised pizza restaurants
25,000 pizza outlets
frozen pizza market more fragmented w/o clear market leader
Product Development
izza KitKit included:
12” crust
Sauce
Cheese
Sauce: Tomato or Pesto
Additional Toppings: Pepperoni, Sausage, 3-Cheese, Mushrooms & Bell Peppers (Sold Separately)
Serve 2-3 people
Market Research:Concept Test
Preliminary Concept test (200 Interviews)
Positive purchase intent was 58% (49% among males, 66% among females)
Results:
128 Heavy Take-out users(once every 2-3 weeks(+))
115 favorable to concept (out of which, 60 said they would buy Contadina instead of another product)
Market Research:Bases II Line Extension Study
Involved both Concept & in-home product use test:
Pizza Kit w/ Toppings Sold Separately
Pizza Kit only (No Toppings Sold Separately)
Determine the impact on trial kit by availability of separate toppings
Analyze Strengths and Weaknesses of both concepts
Pizza Kit
Product
Support either Pizza Kit with or without toppings
Pricing (NRFC expected factory pricing to be 2/3 of retail prices)
$6.39 for Kit
$1.29 for each additional Topping
Place
National distribution possible, could install a pizza line @ the Danville factory
Promotion (Total $18 mil.)
$9 mil. Advertising
$5 mil. Consumer Promotions
$4 mil. Trade Promotions
Target Market
95.5 Mil. Households
Contadina Pasta Users would Represent approx. 24%
MRD felt Parent Brand Penetration could range btw. 5%-25% (recommended volume projections be sensitive to this range)
Based on Promotion Plan, NRFC projected 37% overall awareness
Parent Brand Users likely to be more aware of Contadina name
NRFC Data on Consumer Awareness & Purchase Assumptions
Pizza Kit
Favorable to Pizza Toppings
50% would purchase toppings every time purchased kit
25% would purchase toppings ½ the time
Business Requirements for Pizza
$45 mil factory dollar sales
$12 mil project Investment costs
.3% share retail pizza market
Should NRFC launch a pizza product
Which option
How large market would they find
What market share could be achieved
Analysis:Volume Estimation
Analysis:Repeat Purchases
Analysis
izza ToppingsAnalysis:Revenue Estimation
Analysis:Sensitivity Analysis
5% Penetration
15% Penetration
Should launch Pizza Kit with Toppings
Require @ least 7% Market Penetration to meet Basic Business Requirement of $45 million factory dollar sales ($45,423,334)
Market Size
Market Share
Recommendations
Nestle should first work a lot to refine the taste of it’s pizza.
It should also lower the prices of its offerings.
Company should fine tune its manufacturing facilities before the product launch.
Post launch, company should use the same distribution network as it did for Pasta.
The product should also be supported heavily with huge advertising outlays.
What Happened?
1991-Nestle launches Contadina Pizza.
Positioned as a quick, convenient, yet fresh alternative to frozen pizza.
Pizza introduced in a kit format composing of a 12 inch refrigerated pizza shell, packed together with separate pouches of cheese and sauce.
What happened?
Toppings also were merchandized adjacent to the kit.
Toppings included pepperoni, three cheese blend and Italian Sausage.
Pizza kit was sold for $6.19
Toppings were priced at 1.49
What happened?
Product launched in selected cities.
Marketing support amounted to $11 million in 1991 and $10.5 in 1992.
Company faced disappointing results by not meeting any targets
Sold 4 million units in Year 1 that amounted to $13 millions in sales.
What happened?
Tried to improve the advertising themes by testing three more ads.
All these ads also failed in terms of recall.
Company maneuvered with price promotions but failed in this aspect.
Company had 60% spoilage on the toppings
What happened?
Abandoned the toppings
Sold pepperoni and cheese kit and a cheese kit at $5.99 and $5.49 respectively.
Company paid the price for relying on the pasta data that was in the initial stage.
“Pizza wars” also hampered the profits
What Happened?Marketscan: Americans Hunger for a More Homey Pizza, WSJ, June 29, 1993
1993
Kit sold for $5
Held 15% of the $170 mil-a-year market for refrigerated pizzas & pizza kits
Kraft introduced Boboli Shells
1997 – Nestlé sold Contadina to Del Monte
Excluded from sale was line of refrigerated pasta & sauces
Nestlé's changed name of refrigerated pasta and sauces to Buitoni
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