Reason of Decline in sales of Nestle orange juice 1) INTRODUCTION

For Nestle, in their juices category, Nestle Orange has been their flagship brand since its introduction in the market. The total contribution of orange juice for Nestle has been 20% until last year. However, due to changes in consumers attitudes, for some reason or the other, the sales drastically decreased from 20% to negative 1% from last year to current year. This has been a major area of concern for the organization, its top management and all subsequent lower level staff. People at Nestle are really looking towards finding ways to bring their flagship brand back to the position it was holding for years. We discussed several issues with them to get started with our research and to know what actually could be the reason behind declining sales, the results of the discussion were: Nestle orange juice has always been the leading juice among all available nestle flavors, it showed leading sales. However, this year the leading sales were taken by apple juice. There were no quality issues with Nestle Orange juice, so it was surprising for the juices team to see negative sales. According to the manager, being the pure orange juice with no artificial flavor, and further added vitamin C should have improved the sales. However this was not what actually happened.

i.

Research Objectives

To analyze new competitors in the market to see whether they affect the sales of Nestle Orange Juices. To analyze the effectiveness of promotion campaign of Nestle Orange Juice on consumers. To determine consumer awareness about the product

 To analyze the process of distribution of Nestle juices and its availability in the market. To determine quality of Nestle Orange Juice. To collect specified product performance data for identifying retailers strengths and weakness which could serve as indicator for evaluating the performance of the Supply Chain of Nestle Orange juice.

2)

Premalinary Literature Review

For our project Literature search is one of the key exploratory studies that we conducted, in fact literature search was the very initial study that we began our project with. 1. Initially right after we discovered our underlying problem, for which we are conducting this marketing research, we started up with gathering data and statistics about the company i.e., Nestle itself. We used mostly the web for this purpose. The website that turned out to be most helpful as far as gathering information of nestle was concerned was www.nestle.com.pk Waseem Tariq Floor Manager (HKB) 2. After we got familiar with the company and its product line we moved on to gathering information about our concerned product that is Nestle orange juice. We will gather statistical data, study balance sheets and income statements and other financial reports that we will find out on the web. The most helpful document that we discovered was the annual report of Nestle for the year 2007. As It had sales records of paste years which gave us an insight of trends of revenue. 3. We will also collect a few brochures that Nestle Pakistan has printed and these brochures and pamphlets we will collect from Nestle office located in Lahore. The material and details printed on these brochures etc. shall also be of a great help and shall prove to be an important source for us for understanding the company, as it may help us analyze whether they are having an attractive marketing mix or not, which may help us in analyzing our problem. 4. Another major area that literature search helped us with is gathering data regarding the competitors. On the web we found out who are the competitors of nestle in its juices line and more precisely in its orange juice. Literature search revealed that a few of our major competitors are: Shezan All pure Haleeb Good Day

i.

HALEEB GOOD DAY

Haleeb Good Day offers 100% pure orange juices without any added sugar, flavors or preservatives. Haleeb Good Day orange juice gives the consumers the absolute delight in taste, and revitalizes them at the same time. It is packed in a 6-layered Tetra Pack Brick Aseptic packaging. ii. SHEZAN ALL PURE

Shezan All Pure juices enrich our senses with the fresh taste of 100% pure orange juice. A sip of All Pure helps our taste buds embark on a magical journey filled with the sweetest fruit sensations. iii. Minute Maid

One of the leading competitors of Nestle juice is Minute Maid launched by Coca Cola. Sales of still beverages, such as PowerAde sparkling beverages, such as Coke and Sprite.and Minute Maid fruit juices, jumped 14 percent by volume, far outpacing a four percent rise by

Effect on Children
http://www.nestle-family.com/nutrition-for-all/english/Dont-Go-Overboard-withJuices_743676.aspx. Children are the highest consumers of juices. Some parents don't limit the intake of juices .It is true that 100% natural juices are a better choice than other sweetened and fruit-flavoured drinks, but it could replace milk which is essential in your child's diets. Juice consumption could have its nutrition drawbacks, namely it is rich incalories so drinking it in excess adds extra unnecessary calories to your child's nutrition and juice sales is decline.

Ditribution Network
http://www.favaneves.org/arquivos/1theorangejuice.pdf

through this article we learn that the the distribution channel play a very important role in the consumption of the juice. If the juice are easily reachable to the consumer the can consume it and other factor like advertisement, packaging technology ,discount ofrers are also important. Marketing Strategies
Aggressive marketing, Aggressive selling,Hard launch,Trade sales promotion. Building customer relationship is based on cutomer value and satisfaction it is the heart of modern maketing the two way of goal of the nestle marketing is to attract customer by providing superior value for the customer and to keep and grow current customer by delivering satisfaction through its product.

Advertising and promotionhttp://amcy5.com/Proposals/marketing/amcy14.htm

Positioning is very important in the life phase of product. It plays a vital role in the success of product. If producers succeed in achieving right positioning in market they can easily get their share in market. Advertising plays most vital role for the awareness of the product. Effective advertising makes it possible for the producer to increase brand equity and other value added features in the products. (i) Electronic media

(ii) Print media (iii) Outdoor medi

9. Food Consumption http://rstb.royalsocietypublishing.org/content/365/1554/2793.full

It is important when considering future food policy that a sustainable pattern of food consumption be considered, ensuring a sufficient a sufficient supply and collaborative effort to build more locallybased, self-reliant food economiesone in which sustainable food production, processing, distribution, and consumption are integrated to enhance economic, environmental and social health because people food consumption trend are change they are like fast food as compared to other food, hotelling, outside parties, gathering. 10. Quality Assurance.

In this discussion we observe that in the modern world people are more curious about the quality of the juices because they are more health conscious nestle has made quality product and well known brand all over the world through its quality they create value for the customer. 11. consumer Behaviour It is very difficult to understand the consumer behaviour its required a proper research but nestle differentiated their product through other customer. nestle manager says that we make product according ot the requirement of consumer.we sell what the consumer want not what we offer.

3)

Methodology

For collecting data, questionnaire was made; containing general question about the juice preference and then asking questions related to Nestle Orange juice to know about the brand. Two questionnaires were made to get them filled by consumers and retailers to get information from both retailers and consumers to know about the variables affecting sales of Nestle Orange Juice For the research under study sample size was as follows: 200 samples of consumers and 70 samples of retailer Out of 200 samples of consumers only 178 were valid responses and others were discarded due to their invalid responses. In the retailers only 59 were the valid responses which can be thought as of taking a portion of the whole and studying that portion to make estimates about the whole. Consumers selected in the sample were students of Lahore School of economics LUMS Punjab University Fast

 Hailey College of banking and Finance IMS(institute of management siciences)

4)

HYPOTHESIS
Household income has significant impact on the consumption of Juices. A significant relationship exists between gender and degree of liking of Nestle Orange Juice A significant relationship exists between age and consumption of Nestle Orange Juice Significant relationship exists between the Taste of Nestle Orange Juice and consumption of Nestle Orange Juice. Significant relationship exists between the Price of Nestle Orange Juice and consumption of Nestle Orange Juice. Significant relationship exists between the Appealing Advertisement of Nestle Orange Juice and consumption of Nestle Orange Juice. Degree of liking Nestle juice has any impact on the degree of liking Nestle orange juice. A significant relationship exists between Taste and Degree of liking Shezan juice. A significant relationship exists between the degree of satisfaction of consumers with the packaging of the Nestle Orange juice. A significant relationship exists between Nestle brand juices and preference to stock then by the Retailers. There is a significant relationship between sales and appealing advertisement of Nestle Orange Juice. A significant relationship exists A significant relationship exists between the sales and the profit margin of Nestle Orange Juice between the price of the juice and the profit margin of Nestle Orange Juice

The hypothesis that was formulated based on our research question are as follows:

1) Possible outcome
To check whether sales has any impact on the profit margin of Nestle orange juice. In the questionnaire the questions were asked regarding the sales pattern of Nestle orange juice that is whether the sales are high or low. By using the data obtained from questionnaire a cross tab was made to see the relationship between the sales of Nestle orange juice and the Profit margin of Nestle Orange juice. To check whether sales has any impact on the profit margin of Shezan orange juice. In the questionnaire the questions were asked regarding the sales pattern of Shezan orange juice that is whether the sales are high or low. By using the data obtained from questionnaire a cross tab was made to see the relationship between the sales of Shezan orange juice and the Profit margin of Shezan Orange juice. From the results of this questionnaire the following hypothesis was concluded: To check whether changes in price of Nestle orange juice has any impact on the profit margin due to sales of Nestle orange pack, carton or both. In the questionnaire the questions were asked regarding the effect of change of price of Nestle orange juice. By using the data obtained from questionnaire a cross tab was made to see the relationship between price change and resultant profit margin of Nestle Orange juice

2) Time period
Policy Action Research studies are expected to be concluded within 3 months from the commencement of the assignment. Introduction Preliminary interview Methodology Outcomes 15% 35% 40% 10%

3) References
Tariq Waseem Floor Manager (HKB) 1)www.nestle.com.pk 2)http://nisearch.com/search/pdf/market+reserch+on+nestle+india/10/10

3)http://webcache.googleusercontent.com/search?q=cache
4)http://www.otherpapers.com/Miscellaneous/NESTLE-MARKETING-STRATEGIES/7402.html 5)Nestle Marketing strategy, Research Paper

Author. Mrs.Preeti Rajpal 6) http://www.alliancesud.ch/en/policy/water/downloads/nestle-pakistan.

7) http://www.cci.in/pdf/surveys_reports/food-processing-india.pdf 8) http://www.research-assistance.com/paper/23384/a_ra_default/nestle.html

9) http://www.juicyjuice.com/Products/FAQs.aspx 10) http://www.scribd.com/doc/33118347/Marketing-Strategies-of-Nestle