Nestle Company

ALTERNATIVE STRATEGY

The food market has always been a very vital part of our day to day lives and is mostly affected by emerging trends. Nestle being a food producing company has more than kept up with the market trends but is strategizing to be the market trend setter. From its inception by Henri Nestle, the company has been focused on nutrition and has invested quite a lot in research on ways to improve the nutritional value of its products.  As a matter of fact Nestle operates the world’s largest nutrition based science research unit which is situated in Lausanne Switzerland. Its strategies are guided by three main steps; discovering what customers, spotting causes of change and acting on the changes in the market place an art that was perfected during Brabeck’s reign through restricting of the research and development department ( Bell & Shelman, 2009).

Having this in mind any alternative strategy should be more than product development and brand customization which Nestle are specialists in (Bell & Shelman, 2009). The company states that its strategy in emerging markets is ‘Customization rather than globalization.’ The company can however build on their strength which is nutrition which reflects on good health to reach to new financial heights. The company may have invested a lot in nutrition and research but is this reflected on its advertisement campaigns? This is a strategy that will definitely fit in the Nestle Model which aims at a 5-6% annual organic growth (Jones, 2012).

The media is filled with information and lessons on how to stay healthy, how to eat, what to eat, what exercises to take and much more health related information. Nestle being a product that has been in the market for a long time and this comes with a lot of trust. Nestle can therefore use this competitive advantage as a tool for improving their sales. In SWOT analysis done by most researchers, among the company’s opportunities is an opportunity to make a positive impact on people’s health. The current trend of healthy living is therefore a major opportunity for Nestle to exploit.

Nestle needs to come up with a health campaign that will not only expand its market penetration but also develop its brand name. There have been great success stories throughout the history of advertising but most of them were developed in a neutral market. However in this case the market is in an apprehensive mood and what a better way to sell than giving the consumers just what they want; the information and the product all in one package. Through its vast research resources Nestle can customize its product for the various markets and target audience but all under the context of healthy living. Such a campaign should have a substantive impact on the growth of the company as an entity and not the various brands.

The company’s other alternative strategy is to focus its growth in emerging markets. This is a strategy that has been adopted by many companies that want to expand their revenue. The logistics both in the economy and population all favor the sales of the company. The company however should have a different approach in the implementation of their programs in this market. For effective implementation, there need to be research, development & customization, evaluation & re-evaluation and mergers and partnerships. The company whose motto in emerging economies is customization rather than globalization through their research they can always have a competitive edge over the local companies which may not have the expertise. The level of inequality in terms of income however may slow down the impact to limited growth in the short run but as the economies mature much more revenues are to be expected.

 

 

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