Marketing in an International Environment for Milk Company

Question: Discuss about theMarketing in an International Environment for Milk Company. Answer: Introduction In the present scenario, marketing is essential for enhancing the volume of sales and profitability of businesses. Nowadays, companies focus on developing and implementing different marketing strategies to attract new customers and retain the old ones (Armstrong et al. 2015). However, it can be critically argued that carrying out marketing in an international environment is not an easy task for organizations as it requires lots of efforts and resources. The present study is based on Nestle, which was founded in the year 1905 in Switzerland. The selected business enterprise offers various products linked with food and drinks to different international customers. This research explores the history of Nestle along with its critical resources and their capabilities. Nestles overall strength and weaknesses are also reflected in the present study. Company Background History of the company In the year 1866, the Anglo- Swiss Condensed Milk Company was founded, and in the year 1867, Henri Nestle founded an infant food company. Furthermore, both these companies decided to merge their operations in 1905, and the result of this was the foundation of Nestle Group. It can be expressed that since its establishment, Nestle has always followed an aggressive strategy in the context of mergers and operations (Nestle 2017). For example, in the year 1929, the selected business organization carried out the merger with brands such as Peter, Cailler, Kohler Chocolats Suisses. In 1971, it merged with Ursina-Franck with an objective to improve its overall efficiency (Nestle 2017). The most renowned product of Nestle, i.e., Nescafe was launched in 1938, and in 1977, Nestle SA was incorporated. It was the year 1935 when the company launched the most famous international chocolate bar which is KitKat. The brand has been very successful in its domestic market, and it has been able to acquire a substantial market share because of its product quality. Regarding expanding in the new international market, the objectives of Nestle can be to increase its sales and profitability, to find new customers, to enhance existing customer brand and to improve the overall brand image in the international market. Organizational resources /capabilities It can be expressed that human and technology are the two major resources available with Nestle. The HR practices adopted by Nestle can be termed as effective enough to ensure that a pool of talented and skilled employee is available for the organization (Galalae George 2017). Further, the workers are highly motivated and contribute a lot to the overall success of the company. Nestle also focuses on providing training and development programs to its employees so that their skill set and core competencies can be improved (Benyon Dunkerley 2014). On the other side of this, Nestle also emphasizes on adopting new and advanced technology and integrating the same in manufacturing and overall business operations (Brem, Maier Wimschneider 2016). The use of upgraded technology assists the organization in carrying out the smooth flow of all activities and business practices. In addition to this, technological resources also play a vital role in delivering fast, accurate and satisfactory pro ducts/services to people in the market. Organizational strength and weakness The brand image of Nestle in international market can be termed as the biggest strength of the company. The organization lies in the category of fortune 500, and it is also considered as the large corporation in the food industry in the context of revenue generated (Moura, Branco Camoesas 2015). Another key strength of Nestle is its team of research and development which is efficient enough to innovative new products and satisfies the demand of people in the market. Strong product portfolio and high quality of goods offered are some other strength of Nestle. On the other hand, consumer and legal issues at regular interval can be considered as the primary weakness of Nestle. The ban of products such as Nestle Maggie in India and Boycott of Nestle baby Formula has adversely affected the brand of the image of the organization. Further, products such as Carnation milk can also be termed as the weakness of Nestle as these products are not able to satisfy the need and demand of people in present scenario (Bharucha 2016). Market Selections Analysis of target country market micro environment Kit Kat can be termed as one of the most popular products of Nestle, and it has been very successful in many international markets. It was introduced in the year 1935 and still today, Kit Kat is in high demand. Now, the company can look forward to increasing its market share and can introduce Kit Kat in new markets such as Japan (Hamilton Webster 2015). The rationale behind selecting and targeting a whole new market is that it will provide potential opportunities for growth and development to the chosen organization. However, the product will be affected by the political, legal, environmental, social, technological and economic factors existing within the selected market. It can be expressed that Nestles product will be directly affected by the political environment which exists in India. Kit Kat is very popular in international markets but in Japan the government is paying huge attention to diseases such as obesity. Kit Kat is the product which is generally consumed by teenagers and kids (Cavusgil et al. 2014). Further, strict laws and regulations are developed by the government of Japan to protect issues linked with obesity in teenagers. To operate in the new market, Nestle will be required to carry out certain changes in Kit Kat, and it may also need to reduce the calories and sugar level in the products. The strict laws can results in adversely affecting the sales of Kit Kat in new market. Japans economy is very strong and it is also considered as one of the largest economies in the globe. Furthermore, the economic conditions of Japan are favourable to introduce Kit Kat in the new market. Apart from this, social factors such as growing population of youngsters and demand of chocolate bars among kids will also positively affect the sales of Kit Kat in Japan. In context of technology, it can be asserted that at present, the selected new market is having the most advanced technology in the world (Huff, Song Gresch 2014). Thus, Nestle also has an opportunity to set up its manufacturing unit in Japan for carrying out the production of Kit Kat. The advanced and upgraded technology (machines and systems) will also play vital role in making the selected product successful in new market. However, it can be argued that the legal environment in Japan is rigorous and the brand will be required to follow all regulations and laws while carrying out its business operations. Negligence of corporate and labour laws can affect the sales and overall brand image of Nestle negatively. The new market is also stringent regarding environment protection, and the brand will be required to take care of the same (Ang, Benischke Doh 2015). Like other international chocolates, Nestle can introduce Kit Kat bars in foil covers as it will help in lowering down the environmental pollution. Apart from this, green practices for manufacturing of the bar will also be needed to conduct smooth operations in the new market. Detailed micro research The target market here for Nestle is Japan where the company will be looking forward to introducing the most famous chocolate bar, i.e., Kit Kat. Over the past few years, the demand of chocolate in Japan has grown well, and this can be major success factors for Nestle in a new market (De Beule, Elia Piscitello 2014). The country is also considered as the biggest consumer of chocolate in the entire Asian market. Furthermore, the growing population of kids and youngsters will provide a potential platform to Nestle regarding introducing and selling Kit Kat in the new market. The demand for chocolate bars is growing, and at present, it is an excellent opportunity for Nestle to enter the market (BLOOMBERG 2016). Nowadays, the chocolate manufacturers in Japan emphasize on factors such as healthy labeling of the foods, awareness about consumer changing demand and aggressive product development strategies (Powell 2014). The target customer of Nestle in Japan is going to be kids and teenagers who fall under the category of middle and higher income group in the society. Apart from this, aggressive marketing of Kit Kat bar will be carried out by Nestle in Japan to create awareness among target customers. To sustain in the competitive market, Nestle will be required to conduct changes in its overall strategies and products at regular intervals by changing customer demand in a new market. Competitor analysis In the present scenario, competitor analysis is an important function of management as it helps in identification of the key strategies and plans adopted by other market players. The analysis helps in generating useful information which can be used in areas such as product development or formulation of new marketing strategies. Mars can be termed as the biggest competitor of Nestle Kit Kat in Japan. Further, the objective of Mars is manufactured different food products in such a way that all the stakeholders are benefited from the same (Baker 2016). Mars Snickers are one of the most famous chocolate bars in Japan, and it can give direct competition to Kit Kat. In addition to this, Mars has adopted a moderate price strategy and a marketing strategy which is quite aggressive. It can be expressed that Nestle will be required to invest the significant amount of efforts and resources to steal the market share from Mars and make Kit Kat successful. The quality of Snickers is exceptional, a nd thus, Nestle will be required to adopt an innovative strategy in product development and marketing. Conclusion From the above report, it can be concluded that Nestle is one of the most renowned brands in the food industry of the world. Further, it is successful operation in more than 85 countries of the world. High brand image, sufficient research and development team can be termed as the major strength of the company. On the other hand, controversies at frequent intervals have emerged as the weakness of Nestle. To enhance its existing market share, sales and attract new customers, the company will be looking forward to entering the new market such as Japan with one of its most popular products which are Kit Kat. It can be inferred that factors such as economic, social, technological are favourable and thus will contribute in long terms success of the company. On the other hand, Nestle will also need to ensure that it follows the corporate and labour laws developed in the new market. It can be concluded that Mars is going to be the biggest competitor of Nestle in Japan and Kit Kat will face d irect competition from Snickers. Recommendation Some recommendations to Nestle for making Kit Kat successful in Japan are mentioned below as: It can be recommended that the company should go for the strategy of adoption instead of focusing on standardization. As per the recommended plan, Nestle will be required to carry out certain changes in its product and marketing strategies according to the need and culture people in the new market. The rationale behind this is that adoption will support in meeting the demand and needs of consumers in the Japanese market in the best possible manner. It will also play an important role in making Kit Kat successful in the market. It can be suggested that aggressive marketing practices should be used by Nestle in its new market. More focus should be given to social media and online marketing tools. It can be expressed that aggressive marketing will help in developing demand of Kit Kat among people in the market. Further, it also supports the selected business enterprise in getting a competitive advantage over other market players operating in the industry. The strategies and products should be developed from information gathered through macro, micro and competitor analysis of the new market. 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