Market Segmentation of Nestlé
The industry for food processing is among the most influential and actual ones at all times. Nestlé is one of the biggest and most influential companies in this industry. It was founded in 1866 focusing on breakthrough infant food production. Throughout the upcoming years, the company has got involved in the production of other types of food as well. Today Nestlé presents more than 2000 brands that are sold in more than 187 countries around the globe. Many factors influenced the success of Nestlé. Among them, market segmentation and positioning strategies have their place and role. So, let’s find out the strategies behind Nestlé’s success by discussing it thoroughly.
Starting from the market segmentation of Nestlé, let’s reveal the target audience of the company.
For this purpose, let’s go through the following commercial of Nestlé and analyze it.
The commercial is quite emotional, touching, and interesting. It presents a story about a family who decided to adopt a child. All the scenes are changing smoothly, creating a perfect storyline and evolving plot. The commercial focuses on two children. The little boy in the family feels extremely jealous of the adopted girl. He doesn’t want her around his parents, toys, and doesn’t involve her in different fun activities he does.
The situation seems hopeless as the boy tries to vigorously distance the adopted girl from everyone and everything. Despite all these problems, the parents don’t give up and hope for a positive twist in their relationships. Everything changes at one instance when they find something fun that they can do together. They start playing with worms and seemingly enjoying the process.
Also, they look for snacks and enjoy them together. After all, they create a strong and loving bond and food becomes something connecting these two. Both children and their parents seem adventurous as they are not afraid to take on new challenges, experiences, and risks.
Not all pairs are ready and able to decide to adopt a child as it may bring lots of difficulties and problems into a family. This shows that these spouses are ready to accept challenges and are quite responsible for their actions and decisions.
The parents and two children collectively represent the target segment of Nestlé. All their characteristics and the details of the video show that Nestlé focuses on the segment called Sharers.
Target Segment: Sharers
Lifestyle and Values:
Representatives of Sharer’s target segment love new experiences and emotions. They are not afraid to take risks and challenges and treat them with enthusiasm and courage. These people are extremely adventurous and strive to get enjoyment and pleasure from all situations and activities. They try to do this even if the situation or activity is not exciting or interesting for them.
When it comes to the priorities in life, Sharers are family-oriented people who treat their life duties with great dedication and responsibility. Their home, family, and parents have huge importance for them.
These people do everything to ensure good care and well-being for their close ones. They like spending a lot of time with friends and family at home. They try to make the atmosphere in their home comfy, warm, cozy, nice, and enjoyable for everyone.
At the same time, Sharers are extremely attentive to their appearance. This also refers to the members of their family. These people want to ensure that they and their close ones are eating healthy and staying fit. Sharers consider having a good career very important for their financial stability.
They can be easily influenced by ads, movies, and magazines. As a result, this influence can also be noticeable in the changes in their daily routine. These people love transforming their lives and add variety to them.
Attitude to Shopping:
People from this segment are quite knowledgeable about the trends and novelties on the market. Sharers get pleasure from regular shopping and visits to shopping centers. They enjoy shopping and it brings a sense of fulfillment to them.
Their love for shopping doesn’t suggest that they can’t control the disposable money they have. These people understand their budget limits very well and are remarkably good with their money.
Anyways, this won’t stop them from splurging on desirable products without considering the price or quality of the product. It is not surprising, that Sharers love to try, experiment, and adopt new brands or products in the market.
They don’t stay loyal to brands and switch between them and mainly to the new ones all the time. Sharers want to stand out from the crowd and look different. For this purpose, they use high-end products that they can afford to buy.
Interesting facts about Sharers
- Despite their love for adventurous and new experiences, they don’t like traveling no matter if it is about holiday escapes or short trips.
- Sharers consider TV an inseparable part of their lives. TV helps them to escape from ordinary life and compensate for any limitations in their life. Also, in terms of media, they like magazines about entertainment, fashion, and celebrities.
- These people don’t like using computers and are not fond of technologies in general. Internet is not a life-changing aspect for them, thus they don’t use it often.
Positioning Plan of Nestlé
Positioning strategy is extremely important for any company despite its size, operation, industry, products, etc. Positioning strategy is an effective tool that can have a crucial impact on the continuous growth and success of the company.
Using positioning strategy, companies get the opportunity to create a positive and strong brand image in the minds of the customers. When choosing it, each company should consider the unique and strong aspects of the company, as well as all the specifics of the company and the industry.
The food processing industry is a remarkably competitive one as any other industry related to food. Throughout time, people have become more demanding and attentive to the food they buy and consume.
This has led to continuous changes in needs, preferences of consumers, and changes in trends in the food processing industry. The companies had to start thinking more sustainable and focus on creating food that is healthier for consumption.
Nestlé is one of the biggest and most popular companies in the food processing industry. With the big number of brands that it owns, the influence that Nestlé has on the industry is remarkably big. Nestlé was able to create an effective positioning strategy by taking into consideration all its strongest aspects. The company bases its positioning strategy on the competition.
Positioning strategy based on competition focuses on differentiating the company from the other ones in the market. By adopting this type of strategy for positioning, Nestlé tries to stand out from other players in the industry in several directions.
The company differentiates its products from the others of the competitors by putting a strong focus on the high quality of their products. It transfers the benefits that their high-quality products could bring through the company motto “Good Food, Good Life”.
Also, Nestlé offers a remarkably wide range of products from different categories, which is another way of standing out in terms of products. At the same time, the logo of Nestlé is extremely unique and is not like any other logo of the competitors.
It is easy to recognize and associate with the name of the company thanks to not being mainstream and simple. The logo is unusual and creates a strong and positive brand image.
Another way of differentiation is the channels used by Nestlé. People know this company and its products as ones that are widely available thanks to effective and fast-working distribution channels. Besides Nestlé offers outstanding customer service, which I another strength for the company and positive association for the customers.
Next up, let’s go through the 4 Ps of the Marketing Mix of the company.
The 4 Ps represent the tactics used by the company to effectively promote the brand, its products, and attract new people. So, here are the 4 Ps of Nestlé:
Product: As one of the largest food processing companies in the world, Nestlé offers a remarkably wide range of products. The products of the company are popular for their high quality and nearly always tend to have a unique feature that helps them to stand out from other alternatives in the market.
Thanks to the extensive number of different types of products, everyone can find something corresponding to his/her taste and preference from the products of the company. The huge number of products by Nestlé can be categorized into four groups. These categories are dairy products, ready to cook food, beverages, and chocolate.
Nearly all the brands in each of these categories are extremely popular, renowned, and demanded. The products of Nestlé are known for their attractive, tempting, and carefully designed packaging.
Price: When it comes to pricing, there are different strategies that Nestlé uses for pricing its products. Because of the large number of products in different categories, the company can’t just use one strategy for pricing its products. Thus, Nestlé uses several types of pricing strategies depending on the product. Here are some of those strategies implemented by Nestlé:
Skimming Pricing: When using this strategy, Nestlé put comparably higher prices on its products compared to the other similar option on the market by the competitors. Nestlé uses a skimming pricing strategy when it comes to the products that are extremely popular and can be considered leaders in their category compared to the other brands. The company uses this type of pricing on Nescafe coffee, Maggie, etc.
Competitive Pricing: Nestlé uses this type of pricing strategy when it comes to the products that are in severe competition with the other offering in the market. For instance, Nestlé uses this type of pricing for KitKat. The company prices the product similar to the similar products of competitors and lets the customer decide between the offered options.
Place: The products of Nestlé are available in more than 187 countries around the world. The impact that the company has on the international market is huge. Nestlé did everything to make sure that its products are available in as many locations as possible, reaching a larger customer base. Most parts of sales and revenue of the company come from Europe.
The products and brands of Nestlé are distributed not only in the rural but also in the urban areas making the customer base of the company very inclusive and diverse. The majority of Nestlé products are fast-moving consumer goods (FMCG), which makes the company use channels that will ensure fast and timely distribution of the quickly sold products.
The products of the company are widely available in different types of stores such as supermarkets, small and large grocery stores, etc. Nestlé products are also available in different online stores.
Promotion: Promotion is a crucial aspect influencing the success and popularity of companies despite products, industries, etc. Nestlé understands the power of promotion and uses it to attract customers and stand out among the competitors in the market. Promotion through different media channels is one of the most popular tactics of the company. Nestlé uses both conventional and unconventional media channels.
The company introduces and promotes its products through TV, online ads, social media channels and allows the customer to get a better insight into its products. Nestlé continuously presents different types of campaigns, motivates, and inspires its customer through them.
Their campaigns mainly aim to create an emotional connection with the customers. Along with these, Nestlé actively takes part in different initiatives and charity programs.
Summing up, Nestlé is one of the largest representatives of the food processing industry. The company is known for its excellence, experience, and dedication. It continues to adapt to the changing needs and wants of the customers and the evolving tendencies on the market to keep up with time. Despite the changing environment and the adjustments to adapt to them, Nestlé carries on its initial values and keeps on admiring its customers with the high quality of its products. Nestlé owes much of its influence and success to the market segmentation and positioning strategies it has implemented. That’s all for the Market Segmentation Strategy of Nestlé. Check out the main page of our website for more posts like this.
