Marketing Management

CIA II

BinoyJohn
0911242

A study on the success factors of Maggi Noodles in India and threats faced by them
 Nestle Maggi

Maggi noodles is a brand of instant noodles manufactured by Nestlé. The brand is popular in
India, South Africa, Brazil, Nepal, New Zealand, Australia, Malaysia, Singapore, Sri Lanka,
Bangladesh, Pakistan, and the Philippines. Maggi noodles are part of the Maggi family, a Nestlé
brand of instant soups, stocks, and noodles.

A whole-wheat flour based noodle variation marketed by the name "Vegetable Atta Noodles"
has been introduced in India (Atta flour is used in preparing most forms of wheat based breads
in India and caters to health conscious buyers wary of the refined flour used in the regular
Maggi noodles. This move helps the brand in India as suburban mothers, who feed the noodles
to children as an afterschool snack, are the primary customers of the brand. Recently, a line of
rice noodles and whole wheat with pulses, carrots, beans, and onions has also been introduced
in India

Nestle introduced Maggi noodles in 1983. Soon, it became a hit. Nestle found a vacant position
in the young urban mother’s mind for such a product, an evening snack for the kids. And Maggi
sat on that spot claiming itself as, “fast to cook and good to eat, any time snack.”

Claimed to be "2 minute noodles", The Maggi noodle cake and seasoning is added into boiling
water for two minutes and it is ready for consumption. Egg, seaweed, boiled vegetables or
lemon can also be added to the noodles for a better flavour.
The reasons for the success of Maggi

“What Xerox is to photocopier and Colgate to toothpaste, Maggi is to noodles in India."

o Maggi was introduced as a new product by Nestle India and it was a kind of risk taking
because such food items were new to Indian market. It was targeted basically at working and
urban woman who usually get less time to prepare fresh snacks for their kids in the evening. In
such a case the introduction of 2 minutes noodle was a good thing to do.

o Maggi is the leader in the Instant Noodles category because it is constantly improving its
understanding of the consumer to give them excellent and tasty products that provide
nutrition, health, and wellness.

o Maggi has managed to enter Indian homes to change the traditional food habits of
Indian children on their promise of convenience. This brand has understood the psychology of
Indian mothers and positioned itself for mother-child indulgence.

o During the 1990s, the sales of Maggi noodles declined, and this was attributed partly to
the growing popularity of Top Ramen, another instant noodles product. In order to improve
sales and attract more consumers, NIL changed the formulation of Maggi noodles in 1997.
However, this proved to be a mistake, as consumers did not like the taste of the new noodles.
In March 1999, NIL reintroduced the old formulation of the noodles, after which the sales
revived. This shows the concern nestle had for its consumers as the new formulation was aimed
at achieving some cost savings in the production of Maggi noodles but since consumers
preferred the old one they moved back to the original formulation.

o NIL aggressively promoted Maggi noodles through several schemes like distributing free
samples, giving gifts on the return of empty packs, etc. NIL's advertising too played a great role
in communicating the benefits of the product to target consumers.
o Through its ads, NIL positioned Maggi as a 'fun' food for kids which mothers could
prepare easily. Taglines like 'Mummy, bhookhlagihai' (Mom, I'm hungry), 'Bas 2-Minute,' (Only
2 minutes) and 'Fast to Cook Good to Eat' effectively communicated the product's benefits to
target consumers. These ads had become so popular that the tagline 'Bas 2-Minute'
immediately reminded Indian consumers of Maggi noodles even several years after the ads
were taken off the TV.

o In March 2005, the Maggi brand too took to the health route with the launch of
Vegetable Atta Noodles. NIL made use of the group's extensive research and development
facilities in developing this new 'healthy' product. According to NIL, Vegetable Atta Noodles
were healthier as they were made of whole wheat flour instead of maida (refined wheat) and
also because they contained real vegetables. And consumers liked this version of Maggi as it
was tasty and healthy.
Threats Faced by Maggi

• Competitors with long history in product category Internationally like, Heinz Sauce and
ketchups of Heinz Indian, Top Ramen in Noodle and

• Knorr Soups.

• Single product focused competitors like Heinz sauce and WaiWai Noodles.

• Less Entry Barriers in the Market segment for product category

• ITC’s strong base in Indian Market.

• Substitute Product to Product Segment.