The Concept of Marketing Mix and Its Implementation.

Marketing mix is the set of marketing tools that the firm uses to pursue its marketing
objectives in the market, consists of combination of 4 variables or activities as the core
of company's marketing system including Product, Price, Place, Promotion (4P).

1. Product, is all the things offered to the public in order to be seen, held, bought or
consumed. Products can consist of product variety, quality, design, feature, brand name,
packaging, sizes, services, warranties, and returns.

2. Price, is the amount of money that consumers pay to buy the product or replace the
property of the product, including last price, discount, allowance, payment period,
credit terms, and retail price.

3. Place, is a various of company’s activities to make products affordably produced or

sold and available to the target market, including channel, coverage, assortments,
locations, inventory, and transport.

4. Promotion, is a various of company’s activities to communicate and introduce

products to the target market, including advertising, sales promotion, sales force, public
relations, and direct marketing.

a. Advertising, is all forms of nonpersonal presentation and promotion of ideas, goods,

or services by a designated sponsor using payment.

b. Sales promotion, is a short-term incentive to encourage the desire to try or purchase

products and services.

c. Public relations and publicity, is a various programs designed to promote and protect
the image of the company or individual products created.

d. Personal selling, is a direct interaction between one or more potential buyers with the
aim of selling products.

e. Direct marketing is a direct marketing communication to get responses from

customers and certain candidates, by using letters, telephones, and other nonpersonal
interfaces.

The Evolution of Marketing Mix Factor

Marketing mix consists of product, price, place, and promotion (4P) as the era
development and the demands of market which continuously evolves in line with the
development of consumer behavior and the intelligence of marketing experts.

1
The development of the marketing mix into integrated service management using the
8Ps approaches:

1. Product elements, are all components of service performance which creates the value
for customers.

2. Place, cyberspace, and time, are management decisions about when, where, and how
to serve a good service to customers.

3. Promotion and education, are all communication activities and the designation of
incentives to build the customer's desired perception of the specific services that the
company provides.

4. Price and other user outlays, are the expenditure of money, time, and effort that
customers sacrifice in buying and consuming the products and services that the
company offers or serves.

5. Process, is a method of operation or a series of actions necessary to present a good

product and service to the customer

6. Productivity and quality. Productivity is the extent to which efficiency of service

inputs is transformed into service outcomes that can add value to customers, while
quality is the degree to which a service can satisfy customers because it meets the
needs, wants, and expectations

7. People, are customers and employees involved in producing products and services
(service production)

8. Physical evidence, is the tools required in presenting the real quality of products and
services

Nestlé has a mission to be recognized as a leader in Nutrition, Health and Occupation in

the world, trusted by all stakeholders, and being a reference to financial performance of
industry. Nestlé believes that leadership is not just about the size of the company, but
also about the behavior. Nestlé understands that trust can only be obtained by
consistently fulfilling their promises in the long run. These missions and behaviors are
summarized in a simple motto, "Good Food, Good Life", which reflects a passion through
the company.

The Nestlé roadmap is aimed at creating alignment between their employees based on a
number of integrated strategic priorities to accelerate the achievement of the mission.
The mission demands all of their employees to have the long-term inspiration needed to
build the future and short-term business actions, and deliver the required level of
performance.

2
Competitive Advantages :

1. Unrivaled product and brand portfolio

2. Unrivaled Research & Development (R & D)

3. Unrivaled geographical presence

4. Employees, culture, values and attitudes

True competitive advantage is produced by various advantages that are hard to imitate
throughout the value chain generated in decades.

There is a close relationship between good products and strong Research and
Development, between the vast geographical presence and the spirit of effort, between
great employees and strong values.

Growth Drivers :

1. Nutrition, Health and Hygiene

2. Emerging Markets

3. Outdoor leadership

4. Premiumization

These four areas provide good prospects for growth. They can be applied across our
categories and around the world.

Everything is driven by the Nutrition, Health and Occupational agenda. As well as the
motto "Good Food, Good Life" which offers consumer products with the best nutrition
profile in its category

Operational Pillars :

1. Innovation & Renovation

2. Anywhere, anytime, anyway

3. Consumer communication

4. Operational efficiency

Nestlé must excel in these four interrelated core competencies. All of them encourage
product development, renewal and quality, operational performance, interactive

3
relationships with consumers and other stakeholders as well as differentiation from
competitors.

Excellence in the whole area makes Nestle consumer-oriented, able to improve

performance in all important aspects and achieve excellence in the implementation.

Nestle strives for leadership and gain confidence by meeting the expectations of
consumers whose day-to-day choices drive the performance, the shareholders, the
communities and the expectations of society. Nestle believes that sustainable value for
shareholders can only be realized in the long term if the behavior, strategies and
operations also value the communities, business partners, and, of course, the
consumers, also known as "Creating Shared Value".

Neslte invests for the future to ensure the financial and environmental sustainability of
the activities: in terms of capacity, technology, capabilities, employees, brands, Research
and Development. The goal is to meet today's needs without jeopardizing the ability of
future generations to meet their needs, and to do so in a way that ensures year-to-year
profit growth and high returns for shareholders and the public at large in the long run.

4
SWOT Analysis (Strength, Weakness, Opportunity, Threat)

Strength

It is important for every marketing object of the company, to be able to cooperate in the
business. Using a simple SWOT analysis can improve the company and every board that
wants to be led. The ability of the company to position its products depends on the
ability and satisfaction of consumers in their needs. This is the value contained in
marketing, including sales and market share, analysis of competition, sales and profits
for the future and analysis of changes in consumer behavior.

Cooperatively, Nestle is the largest and best food brand producer. With its high quality
products over the years, Nestle still maintains the quality of its products to face other
competitors as well as keep the balance in business.

With a portfolio of products including 8 of 30 sales of convectory brand, such as Quality

Street, Aero, Smarties, Polo, and Rowntree's fruit Pastilles, Milky Bar and After Eight, it
is essential that the marketing object on each product must be compatible to all
corporation’s objects. Groups or individuals, each product has its own character,
strengths, weaknesses and consequences, the marketing object of each product must be
specialized.

The advantages of Nestle for 50 years become the best food brand and become a brand-
minded for consumers. When consumers enjoy Nestle products, then the strapline
'Have a break, have a Nestle' will be the semantic network. The shape and taste is also
costumed in the area where the product is created, then Nestle has succeeded for 50
years into the ranks of favorite snacks in the world.

Weakness

Nestle products have hardly any deficiencies because they always pay attention to
changes in market demand and consumer tastes. Following the needs of consumers is
the paramount to the success of the company. However, if we examine more deeply in
the lack of Nestle in terms of promotion in 1999 that made sales plummeted. From the
data obtained at that time, teenagers did not like Nestle and prefered other brands they
thought more suited to their souls.

To overcome this, Nestle made the decision to launch a new, more youthful product.
And after the launching of this product in 1999, the sales significantly increased, making
it back into the ranks of the best chocolate crispy products. Based on that experience,
Nestle promotes its products through two media. However, Nestle is under pressure
with the emergence of new product competitors which fight in the market share.

5
Opportunities

Changes in consumer tastes provide a good opportunity for Nestle to create new
variants for its customers, to see the existing business opportunities requires the
sensitivity to read changes in the external environment. Field survey is the best way to
know the changes that occur, consumers always want to be noticed. The opportunities
that exist today insists Nestle to keep upgrading its products but still sticking to its
principle by maintaining the original product character or character that has always
been the hallmark of Nestle's products compared to other products.

In addition, Nestle's big name has also become one of the good opportunities for Nestle
products because of the brand-minded consumers that make them to buy Nestle
anywhere and anytime. Nestle always pays attention to marketing objects for the long-
term benefits. With a patent brand using strapline 'Have a break have a Nestle', Nestle is
trying to reach out all circles, closing all possible competitors.

Threats

In the case of Nestle under the name by Danone matching this brand with the name of
Cit Cat, this became a nuisance of Nestle and Nestle's reputation threat. This condition
was obviously very disturbing because this brand was firstly used by Nestle. The
challenge was hard enough, insisting Nestle to appeal to the Director General of
Hak Kekayaan Intelektual (HAKI), especially to the directorate of its brand. In filing a
lawsuit, Cit Cat was subjected to a bad faith suit due to the same brand as Nestle's. Such
a threat can influence the efforts to match the brand in order to make consumers
affected.

Therefore, in facing these challenges, re-oriented must be conducted in order to answer

the reason why Nestle products can have a competitor whose name is almost the same.
Based on the review, the successfulness of Nestle influences the competitors to try to
equate Nestle. Good management also supports the strength of the brand, good business
planning makes Nestle achieve success and maximum profit.

Strategies For Competitive Advantages

Every product on the shelf, every service and every customer contact, helps to form
Nestle’s image. A Nestle brand name on a product is a promise to the customer that it is
safely consumed, which adheres to all rules and meets high quality. Customer standards
expect Nestle to fulfill this promise every time. Nestle always compromises about the
security of the product and every effort should be made to avoid health hazards.
Complying with all relevant laws and regulations is a must and not negotiable. The
people, equipment and instruments are made to ensure the security, availability and

6
suitability of Nestlé products any time. Companies with very large quality standards
make fewer mistakes, wasting less time and money and are more productive. They also
make higher profits. Quality is Nestle’s most successful product. This is the key to
Nestle’s success, today and tomorrow.

Marketing Goals and Objectives

Nestle is keen to deliver healthy products to the wider community around the world so
that people around the world can be assured of their health by the presence of Nestle's
quality assured products. In addition, Nestle has a goal like most other companies that
want to compete with other companies with a healthy competition and can dominate
the world market. Nowadays, the goal of Nestle's company to master the world market
in a healthy way is almost reached by using a good market strategy, while the hard work
of Nestle is getting stronger and growing rapidly.

Nestle's business objective is to manufacture and market the Company's products in

such a way as to create long-term sustainable value for shareholders, employees,
customers and business partners. Nestle recognizes that consumers have a genuine and
legitimate interest in behavior, beliefs and actions. Nestlé continues to maintain its
commitment to follow and respect all applicable local laws in each market.

SMART Analysis:

S = Specific

M = Measurable

A = Actionable or Achievable

R = Realistic

T = Time Frame

Marketing Strategy

Market Segmentation and Targeting Strategy and Consumer Profile Market

Segmentation Analysis

In order to get the maximum market share and in connection with the product in the
minds of consumers, according to the observations and market surveys, it is concluded
that Nestle Pure Water's segmentation Life is based on two points : Geographical
Segmentation and Demographic Segmentation.

7
1. Geographic Segmentation

The company has divided geographical segmentation in some areas. First they have a
segmentation of the whole country and from every provincial capital, they divide the
area to the north, east, west, south. So it can be easy for a company to work efficiently
on supply chain management.

2. Demographic Segmentation

Nestle Pure Life is not the highest quality product that only high class uses. This product
is for all ages, such as baby, elderly. No age, gender, income and other types of
restrictions on the product usage. This product is for all. Anyone can use the product as
needed.

Targeting Strategy

According to the observations and market surveys, it is concluded that there are
unregulated demographic techniques to set specific target markets. Because, water is
something that everyone needs. Everyone can use the bottle size Nestle has to offer.