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Product Life Cycle



Introduction To Nestle 2-Minute Maggi Noodles

It's a brand of instant noodles made by Nestle India Limited. It was found by the Nestle family based in Switzerland in the 19th century. Nestle launched Maggi in India in year 1982. Nestle wanted to explore the potential for instant food among the Indian consumers. It took several years and investment on part of Nestle to establish itself in India. Now it enjoys a 90% market share in this segment .

Product Life Cycle

A concept that provides a way to trace the stages of a product's acceptance , from it's introduction {birth} to it's decline {death}.

Introductory Stage
High failure rates No competition Frequent modifications High production costs Nestle India limited , an Indian subsidiary of the global FMCG major , Nestle introduced the Maggi brand in India with it's Maggi 2-minute noodles With the launch of Maggi noodles , NIL create an entirely new food category - instant food in the Indian packaged food market .Since then NIL has been able to retain it's leadership in the instant noodles food category

Market Penetration
Promotional campaigns in schools Advertising strategies : focus on young children New product innovations according to the needs of customers : vegetable Atta noodles , Cuppa mania , Dal Atta noodles Different packaging : 50grms , 100grms packs

Growth Stage
Increasing rates of sales Entrance of competitors Initial healthy profits Development costs are recovered In early 1990's the demand for Maggi noodles started to fall due to launch of Top Ramen ,another instant noodle product So in order to increase sales , NIL formulated the flavor of Maggi noodles which was not accepted by the consumers In March 1999 NIL re- launched the old version of Maggi noodles , after which the sales revived

Maturity Stage
Declining sales growth Saturated market Extending product lines Heavy promotions to dealers and consumers Prices and profits fall In 2003 HLL introduced Knorr Annapurna , a liquid snack segment in competition to NIL's Maggi range The new product by HLL was priced at rs.5 and came in 4 variants Like Maggi ,Soupy Snax targeted all age-groups ,particularly office goers

Segmentation To Differentiation
Classic Noodles - 5 to 10 yrs Veg. Atta Noodles - health conscious Rice Mania - teenagers Cuppa Mania - office goers

{if no innovations are made}

Decline Stage

Long drop in sales Large inventories of unsold items Elimination of all non-essential marketing expenses

Analysis why Atta Noodles failed ??

In 2005 NIL launched Maggi Veg. Atta noodles It was based on consumer's needs for more whole grain based products Extensive research and development was done by the NIL team Maggi Atta noodles provided all the essential dietary fibre of whole wheat grains Maggi Atta noodles were priced more than the regular noodles in the market

Reasons For Failure

PRICE: The price of Atta noodles was little more than the regular noodles FALSE CLAIMS: In October 2008 Nestle mistakenly aired an ad claiming that noodles helped "in building strong muscles and bones ".The Indian Advertising Standards Authority declared it a false claim later NOT PURELY VEGETARIAN: Maggi Atta noodles contained additives such as E250d and E627 which are made of fish and hence not suitable for vegetarians LACK OF ESSENTIAL NUTRIENTS: It lacked presence of essential vitamins such as A and C. Moreover it targeted health conscious people but it contained a high percentage of fats .

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