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Neve in Brazil

International Marketing Strategy for Coventry University London Campus
by

Pamela Downing

on 24 July 2015

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Transcript of Neve in Brazil

Behavioral:
occasions: (social occasions, family time), impulse buying
Brazil demographics
(as of July 2014)
Total population: 203.455.312 as of 23/11/2014

0-14 years: 23.8% (male 24,534,129/female 23,606,332)

15-24 years: 16.5% (male 16,993,708/female 16,521,057)

25-54 years: 43.7% (male 43,910,790/female 44,674,915)

55-64 years: 8.4% (male 8,067,022/female 9,036,519)

65 years and over: 7.6% (male 6,507,069/female 8,805,247)
CIA Factbook 2014
POSITIONING STATEMENT
For those who can't live without a sweet treat, but still want to be healthy, Neve is the perfect combination of delicious frozen yogurt and fresh fruity flavors. To be enjoyed at the beach, the mall or anywhere the fun is!
Tutti Frutti
Yogen Fruz
Bendita Fruta
Yogoberry

Cheese cake Neve
Biscuit crumbs
Blueberry Neve
Frozen Yogurt
Industry
in Brazil
Psychographic:
social class – mid-high
USP: 12 generic flavours, as well as 17 unique flavours such as apple pie and red velvet.
USP: Self-serve frozen yogurt, with 23 unique flavours in Brazil
USP: Various flavours, including seasonal monthly introductions
Demographics:
Middle class families (more than 1/3 of population)
age 5-12
Geographic:
Developed cities
Shopping malls
Cinemas
Beaches
USP: Five different flavours, including specials such as blackberry and Sicilian lemon.

STRENGTHS
WEAKNESSES
OPPORTUNITY
THREATS
SO
WO
ST
Shopping Malls

Buyer Power
Medium / Low
Intensity of
Rivalry
Medium
Threat of New Entrants
High
Threat of Substitutes
Low
Supplier Power
Low
Porter's Five Forces
Theme Parks
RESOURCES AND CAPABILITIES
Situational Analysis
Beaches
Rio de Janeiro
Sao Paulo
7 P's
High quality
Low quality
High price
BRAND POSITIONING CHART
SWOT / TOWS Nestle in Brazil
EXECUTIVE SUMMARY
Key Facts About Nestle
4.6% Organic Growth (FY2013)
Group sales of CHF 92.2 billion +2.7%
44% of sales from Zone Americas
(Nestlé Annual Report 2013)
Mission
Vision
Creating Shared Value for
To be a leading, competitive, Nutrition, Health and Wellness Company
Company Introduction
Latest Figures from Nestle
Our Team
Pamela Downing
Laetitia Chambard
Prina Vibhakar
Bianca Chitic
Ching Wing Frank Wong
Introductions
Situational Analysis
Objectives
Strategy
Implementation
Monitoring and Control
Acquisition&Retention
Recommendations
Marketing Objectives
3. Generate 20% of repeat purchases and customer satisfaction by 2018 measured by customer feedback
1. Year on year growth
2. Diverse product portfolio
3. Innovative culture - extensive investment in R&D
4. High brand equity
5. Strong production capacity
1. Inconsistent food quality has damaged the company image
2. Criticism over irresponsible marketing techniques
3. Evident gap in healthy products
1. Latent market for healthy foods: Obesity challenge leads to a high demand for healthy foods

2. Large population with increasing disposable income in a growing economy

1. Legislation and restrictions on advertising to children
2. The attractive market will lead to increased competition
3. Market of frozen yogurt dominated by local companies
New Product Development
Product Strategy
Product Research
Primary
Secondary
Pricing Strategy
Early growth
Late growth
Decline
Maturity
Introduction
Introduction Stage:
Penetrative Pricing Strategy
R$ 4.50 per 100g cup of Neve
Early GROWTH STAGE:
Value-BASED PRICING strategy
Late growth stage:
Value-based pricing strategy
Maturity stage:
Competitive pricing strategy
R$ 6.00 per 100g Neve
Decline stage:
Competitive Pricing Strategy
Prices will be lowered to achieve cost leadership and exist to serve a Niche market
Competitor prices range between R$5.50 - R$9.50
Gap Analysis
Our Product
Healthy, High Protein, Low Fat, Low Cal
Melts slower than ice-cream
Fun form of dots
Place
Promotion
Process
People
Physical Evidence
Distribution Strategies
Selective distribution
Dependent on customer segment
Multi-channel distribution across marketing intermediaries
Vertical marketing integration
20-30 years old, for better attraction and interactions with children and families

Will be provided with food handling training and customer service

Two people in each shops, one at the cashier, one at the preparation in order to gain efficiency























R$5.50-6.50 per 100g cup of Neve
Price dependent on the perceived value of Neve and according to beach location and shopping mall
R$ 6.00 - 7.00 per 100g cup of Neve
Demand
Reassessed
Prices
Readjusted
Company mission statement
1. Achieve sales revenue of £8 million after 1 year (short term) and targets for 2 (£25 million) and 5 (£60 million) years (long term))
2. Gain brand awareness during the pre-launch campaign by sponsoring local sporting activities and conducting giveaways at the targeted segments
Our mission of "Good Food, Good Life" is to provide the best tasting, most nutritious choices in a wide range of food and beverage categories and eating occasions, from morning to night.
Customers
Shareholders
Society
Diverse product portfolio: Over 4,000 brands from baby food to pet care

Nestle group divided into 3 main Zones:
Zone Americas
Zone Asia, Oceania and Africa
Zone Europe

Rated No. 54 out of 100 Best Global Brands

Established in Brazil for 93 years

R$ 5.50 per 100g of Neve
Increased competition leads to competitive prices to defend market share and retain customers
BRL 5.00
BRL 6.50
BRL 7.50
Break Even Analysis
22 factories owned in Brazil
Hierarchy of effects model
(Kotler & Armstrong 2014)
8% market share of Yogurt industry in Brazil
First launch in Brazil
PATENT
Competitor Product Analysis

4 years to issue patent only 10% are granted. Special circumstances will allow the patent to be escalated to less than a year.
Deposit fee: from BRL 55,00 to BRL 140,00
Invention analysis: from BRL 160,00 to BRL 400,00
Utility model analysis: from BRL 110,20 to BRL 280,00
Insurance of the patent letter: from BRL 40,00 to BRL 95,00
Yogurt, flash-frozen into little dots using liquid nitrogen
Current State
Future State
ACTION PLAN
Current State
Action Plan
Set up various events to promote Neve
Push strategies
Pull strategies
Use 360 Feedback in order to gain customer and staff insight into their feelings towards Neve
steps to create brand awareness
Steps to gain brand loyalty
Use Nestle's strong brand position to promote Neve in Brazil.
Use pre-existing brands of Nestle to promote Neve
Steps to Achieve sales revenue of £8 million (yearly assessments (short term) and targets for 2 (£25 million) and 5 (£60 million) years (long term))
Offer customers loyalty cards and assure them that Neve is a high quality, and affordable product
Use appropriate pricing strategy
Sustain brand loyalty
Have a clear structure and sales strategy
Ideas generated: New product must be healthy
New product to be aimed at families


Healthy cereal bars
Green tea extract in cereal bars
Frozen yogurt- make it unique by making the frozen yogurt form into dots
Frozen yogurt in the form of dots does not exist
7 companies sell frozen yogurt in Brazil
Families on days out would eat our frozen dots (focus groups)

The competitors average price of frozen yogurt is around the R$6.50 mark
The product would look like a handful of frozen dots, with the packaging representing the flavour of the choosen dots
Conduct focus groups and taster sessions, as well as online questionnaires to gain wider feedback.
Promote our product via facebook, TV Ad, word of mouth and sponsoring local sport events
Launch our product in our 5 selected stores on the 15th of December 2014
5 Distribution factories, located close to our choosen stores
Market our product via Facebook, twitter, posters, leaflets, TV Ad and word of mouth
cROSS-PROMOTIONAL ACTIVITIES
Sponsorships
Samples and giveaways
TV Commercials
Website / Social Media
Competitive advantage thanks to already existing brand recognition
Gap in healthy food market
3. Brand recognition
Improve brand image on healthy food market

Brazil
Largest country in both South America and Latin America
Fifth largest country, in terms of both population and geographical area in the world
7th largest economy by nominal GDP and and the seventh largest by purchasing power parity, as of 2012.
High production capacity can overcome the one of internal companies


Power of global companies much lower in Brazil





































































frozen
yogurt
flavours
design
package
quality
QR code
social media
& website
4 flavours
colourful dots
bubble-shaped
logo, mascot & dots
brand image
non-artificial ingredients
Nestle concept on health
directing to website
brand awareness
Avocado
Papaya
Pineapple
& cilantro
Acai
Consumer behaviour
Brazilian consume what is produced in the country
selection of locally-grown fruit
Brazilians are massive fruit consumers
(due to high temperatures)
local responsiveness
pressure for global integration
pressure for local responsiveness
Global
strategy
International
strategy
Multidomestic
strategy
Transnational
strategy
The Three Layers
appealing +
differentiation
Beaches

Shopping malls

Themes Parks
Low price
vans
Stands
DIFFERENTIATED MARKETING STRATEGY
Neve possess the leverage of Nestle (assets and capabilities)
Service provider representatives
Procedures
Controls
Information flows
Payment
Speed and timing of delivery
Three requisites:
Novelty
Inventiveness
Industrial application
MODE OF ENTRY
FOREIGN DIRECT INVESTMENT
Nestle has been in Brazil for 93 years with a presence in 99% of the households
Most of Nestle product portfolio has been created through FDI and Franchising (such as Haagen Daaz)
Explosion of middle class segment in Brazil
Two mains target segments
5-14 years old
families
initiators
buyers
Alliances
Attractions parks => cross profitability advantage
CIPD
360° performance appraisals

Buyer process
Development of Customer (Children)
Direct purchase
Money children influence parents to purchase
Future market
Customer behavior - decision making steps
Thank you for your attention
Any question?
RECOMMENDATIONS
CONTINGENCY
MONITOR AND CONTROL
ACQUISITION AND RETENTION
Only a few established frozen yogurt companies
Neve is the only company to offer frozen yogurt in the form of dots
Ice-cream, chocolate, general deserts
No other direct substitute to 'frozen dots'
Yogoberry
Yogen Fruz
Tutti Frutti
Yogolove
Bendita Fruta
Yoggi
Yogofresh
Frozen yogurt is an upcoming trend is Brazil (Mintel, 2013).
Neve is offering a product that has never been introduced before
Nestle have dairy partners in Brazil, thus use vertical integration (Nestle, 2011)
Based on Porter's Five Forces, Brazil is an attractive country.
Price:
R$5.50 (Natural) (£1.36)
R$6.50 (Flavoured) (£1.61)
Price:
R$7.90 (Standard) (£1.96)
R$9.90 (Special) (£2.46)
Price:
Dependent on weight of cup, R$5 per 100g (£1.20)
4. Generate awareness of the nutritional value of NEVE WITHIN THE FIRST YEAR OF LAUNCH.
12%
FINANCIAL SALES
Expand Neve into neighbouring countries
Use franchising to expand Neve in Brazil
Develop new flavours which are inline with consumer taste
Expand product line (related and unrelated diversification)
E
V
E
"At Neve, we believe everyone should have the chance to be healthy, happy and have fun everyday! This is why we are committed to doing our best in making our customers happy and ensuring each customer is provided with a unique experience when buying our product".
Disney endorsement
Sustainability
0% fat alternative to fight obesity challenge
WT
New flavour
Primary
Secondary
Risk Analysis
Factory
OUTLINE
partnership with haagen-dazs
MONITOR AND CONTROL
BUDGET
Profitability
ROI: YEAR 1
supermarkets
Menchies (n.d.)
Nestle SA (2014)
Nestle SA (2014)
Nestle SA (2014)
Nestle SA (2014)
Responsible Production
Responsible Consumption
Value-creating strategies
Customer Loyalty
inimitable
Partnership with the Olympics in Brazil in 2016.
Creation of attractive Mascot (FLOCO)
Cinema teaser trailers and adverts
Distribution of vouchers and coupons
Creation of loyalty card
Development of product and flavours

Surprise gift in package
Higher perceived value
Benefit from
brand reputation
resources
expertise
TV ADVERTISEMENT
iNFORMATIONAL APPEALS
tRANSFORMATIONAL APPEALS
A brief overview of the products USP's
Using a mother and a child to show who would use the product
building awareness
Providing knowledge
facebook
Packaging
POS Displays
sponsorships
Official Olympic Partner RIO2016
Neve will be the Official Healthy Treat of the 2016 Olympics
PACKAGING
INFORMATION LEAFLETS
INCREASE LIKEABILITY OF THE BRAND
B2B
B2C
PERSONAL SELLING &
NEGOTIATIONS
BULK DISCOUNTS

SALES PROMOTIONS
MASS MEDIA
SOCIAL MEDIA
PACKAGING
BRAND CHAMPIONS
An overview of retail prices
an overview of wholesale prices
Wholesale price:

R$ 4.00 per 100 units purchased

R$ 3.50 per 500 units purchased
ROI: YEAR 2
5.5%
4%
FLOCO - OUR MASCOT
Front Page
Back Page
Profitability
Full transcript