There would be hardly any guy in India who has not eaten Maggi. But the interesting fact is that Maggi which is most profit making product of Nestle was not started by Nestle. Maggi was started by a businessman named Julious Maggi in the year 1886. And in the year 1947 Nestle acquired Maggi. After that Maggi planned to take the product to entire world. And in the year 1983, when India won the World cup, Maggi had entered India.
Maggi has 70% of India's market share in the noodles business. And no one was able to beat Maggi till date. But why is it like this? What is the reason behind this? There are three secrets behind this. The third reason is so powerful that if it hadn't been there then first two secrets would have been useless. So Hello Guys welcome back to our website case-bio.blogspot.com where you get interesting things.So what is the first secret?
#1 Neuromarketing : Case study on nestle maggi
The first secret is Neuromarketing. How does it work? See when Maggi entered India for the first time, so they firstly marketed themselves as a convenience product for women. And they failed miserably, the only reason was that Focusing on Consumer and Not the Buyer. See what is the psychology of the buyers? First of all see, what your buyer is. Who is the buyer of Maggi? The housewives, women who work at home, those are the real buyers of Maggi. And how do their psychology works? Now see, woman's psychology is simple in India.
The women are more interested in buying product for their kids rather than for them self. And Maggi committed the same mistake initially. They marketed for women whereas they should have marketed for kids. After that Maggi changed their marketing campaign. But they faced another problem, which was, in India the staple diet is Roti-Sabji and Dal-Chawal. So what does Maggi had to do? Maggi wanted to replace the snacks in India with Maggi. So they targeted the snacks segment. What types of snacks are consumed in India? Pakoda, Samosa, Sandwich all these are consumed. Kids like to have all these items in the evening. But these items needs huge time to cook. Now the cheap alternative is Chips or Biscuits.
But there is one factor, there is huge catch, catch is in the quantity. You understand this, see if kids have to eat enough then they need at least 3-4 packets of chips, they will have to eat at least two of them. And if it comes to biscuit, they will need 2-3 packs. Now here understand the psychology of women. The household women believe that if their kids have 2-3 packs of chips or of biscuits then it is too much unhealthy. The reality is that one packet of Maggi is more unhealthy than biscuits or chips but still how does women psychology works?
So women psychology or our mother's psychology simply says that if the kid is having chips or biscuits then it is too unhealthy. Instead of that why shall not I cook and feed him with single Maggi packet? And this is where Maggi has targeted consumer studying the psychology. After studying this, Maggi re-marketed itself as a 2 minute noodle. And their slogan was "Taste Bhi Health Bhi" Now you would ask, "Is this all sufficient? This is the reason why Maggi is so successful today?" Well, No! There is one more factor behind this. So see The neuromarketing of Maggi is supported by its brand Qs. What are the factors in the brand Qs that Maggi uses?
Visual Codex
The first one is Visual Codex. If you study the Visual Codex of Maggi, if you see its logo then you will find two colors, Red and Yellow. These two colors are very much dominant colors. And in human body it increases Ghrelin which is a hunger hormone. So we feel hungry automatically looking at such things.
Design Consistency
The second factor is Design Consistency. If you properly study the logo and packaging of Maggi then you will find that for years they have not changed it. The reason is that they wanted to generate long term recall value in our minds and even in our parents minds.
Void Fillers
And the third factor is Void Fillers. There is void in everyone's life. So Maggi observed that women are becoming detached from their kids. And we must strengthen this bond. And this void is filled by Maggi with its emotional story telling. They designed their ads in such a way that they strengthen the bond between mother and child. And this is what all mothers Need. "Okay! So that is why Maggi is dominating". Well, no! This is not the reason behind Maggi's domination.
#2 Comeback of Maggi : Maggi marketing strategy
The real reason is behind domination is somewhat else. So see, in the year 2015 when Maggi was banned, when Maggi was tested in lab then it was found that Maggi contains illegal quantities of Lead and MSG - Mono Sodium Glutamine. At that time the allowed quantity was 2.5 PPM and Maggi sample contained 17.2 PPM of lead and MSG. And these are very dangerous levels. Because of which the Maggi was then banned.
Now what happened with Maggi at that time? On 5th of June 2015, Maggi recalled its stock worth Rs. 300 Crores from market. Now the interesting thing is that 8 months later Maggi made a comeback. How?
See Maggi was banned in June 2015 but they did not stop their marketing. From August end they resumed their marketing campaigns and used the nostalgic feeling, nostalgic marketing. They introduced good campaigns such as We miss you Maggi, Maggi is Safe Now. What happened because of these campaigns. The communication with the consumer did not break but became stronger.
See it was banned in June and relaunched in November properly by passing the three tests. And when it was launched they collaborated with Snapdeal. They launched it smartly. Flash sale was used. Flash sale means available for short duration and stock will not last long. What happened due to this is they built the scarcity in the market.
They run a campaign in collaboration with Snapdeal "Dil ki Deal!" And that's where they had a slot of five minutes for which the Maggi would be available over there. In 5 minutes they sold 60,000 packets. Thus Maggi understood that they are still king and they just need to re-enter the market. But, Maggi's comeback would never have been possible if Maggi had not used this strategy.
Range Brand Marketing Strategy of Maggi Noodles
The strategy is Range Brand Marketing Strategy. What is this? See the Range Brand Marketing means You have launched a range of products under a brand name. How many products of Maggi are sold? Spices, Sauces, Soups, Upma, Pasta are sold. So much variety of products are sold under the brand name of Maggi. The advantage of this is that even if one product faces an issue still brand name is not directly damaged because of so many products. And that is why Maggi had launched so many products.
Even if any issue comes in future then they are not dependent on single product and their brand value is not affected too much. Okay! That's why Maggi is so much successful. Hmm! No! If Maggi did not have this third secret then first two secrets would have been useless.
#3 APC : Maggi biography
A for Addiction
What is that third secret. Well the formula is APC, how does it work? A for Addiction, Maggi is very addictive, so much so that you cant even imagine. How does it work. See some substances are added in Maggi which makes Maggi addictive. The first substance is Flavour enhancer (635), it does two things, first it makes the aroma or smell of the Maggi very strong which can be sensed in the nose and increases Ghrelin in the body. It means you feel more hungry. And second thing it enhances the taste. What happens because of this? When you eat Maggi your body releases Dopamine, a happy hormone. And our body need large amount of Dopamine.
Now see this would not have worked at all if these two contents were not added to Maggi. What are these? They are raising agent (500) and Guar gum. These two increases the density of Maggi, makes it thicker, makes it more filling. Due to these two things happen, first when you eat you get the taste and Dopamine is released, second, when you eat and feel fulfilled still your body releases more Dopamine. And Dopamine is highly addictive. So anything that is releasing Dopamine is addictive, may it be Video games, Social media, Maggi.
P for Price in-volatility
P for Price in-volatility. If you you look at the price of Maggi then they have not increased much. It was Rs. 7, then Rs. 10 and then Rs. 12. Not much rise. Now what are the reasons behind this? First is the positioning of Maggi, how is it? The positioning and pricing goes hand in hand. The positioning is as an affordable snack. See if you have to keep affordable so you need to keep the rates low. Second is the buyers of Maggi, Maggi knows its buyers, their first buyers are women, 70% of the Maggi is purchased by women. Why?
Because they go for the grocery. And the women are very much price sensitive when they buy the ration. If they find anything expensive then they don't buy it, especially when it comes to groceries. And the second is reselling. Maggi is very much into reselling, if you observe there are so many shops, outlets on hill stations where Maggi is sold. People sell it for Rs. 30-40. So if the Maggi increases its prices then those people will stop selling Maggi. And here also Maggi will suffer loss hence they don't raise the price.
Now over the years inflation is there but how did Maggi managed all these things? Well it is quite simple. They have reduced the quantity and packaging material. If you observe Maggi had 100 gm pack earlier, now they have kept the price unchanged at Rs. 12 but reduced it to 70 gm. And they also reduced the thickness of the packaging material. Because of which they are able to sustain at low prices in market.
C means convenience
And C means convenience, see Maggi provides so much of convenience to people. Firstly it is a packed food which you can carry anywhere, second it is ready to cook, nothing much needs to be done third is that anyone can cook it. Fourth, brother it is a two minute noodle, so cooks very fast, so it provides so much of convenience. Addiction, Price in-volatility, Convenience - APC Combine these three things with two strategies of Maggi which forms an unbeatable brand. If you enjoyed this case study then do comment.
