Case Study

on
Nestle : The Infant Formula Controversy

Susangkar Das
Roll no:- 107
Section - MD
 Company Details
Organization name: Nestle’
Slogan: Good Food Good Life
Established: 1866
Product Category: More than 2000 brand
Employee: 328000
Number of country of business: 191 Number
of factories: 418 in 86 countries
 Summary of the case

• For over 20 years, Nestlé has been directly or indirectly charged with
involvement in the death of Third World infants.
• “Nestlé Kills Babies,” and accused of unethical and immoral behavior.
The Charges:
Charge against infant formulas is whether advertising and marketing of
such products have discouraged breast feeding among Third World
mothers, thus contributing to infant malnutrition and death.
• The only way of water comes from a highly contaminated river in Peru.
• Throughout the Third World, many parents believe the bottle itself has
nutrient qualities and they dilute the formula to stretch their supply.
• In rural area, children had never been breast fed, and since birth their
diets were basically bottle feeding.
• There has been a dramatic decrease in the incidence of breast feeding
because of intensive advertising and promotion of infant formula.
The Defense:
• Nestle believes that breast milk is the best food for infants and
encourages breast feeding around the world as it has done for decades.
• Infant formula should be used as a supplementary not primary food.
• Third World Mothers feed bottle because their work schedules in
fields do not permit breast feeding.
•Weaning foods formula is not qualitifull.
The Resolution:
• Nestle undertook to carry out more comprehensive health education
programs.
• Nestle fully supports the World Health Organization (WHO) United
Nations Children’s Fund (UNICEF) code.
New Nestle policies:
• No advertising to the general public
• No sampling to mothers
• No mother craft workers

New Twist:
• Human immune deficiency virus (HIV) infected among children by
consuming mothers’breasts.
 Q1. Responsibilities of the company
Remain in the business and try to improve product quality.
 Try to educate the consumer about hygienic and sanitation problems.
Contribute in social events as sponsorship to conduct medical and
nutrition conferences.
Setting up their pricing strategies which will be reasonable and
affordable for the target audiences.
And most of all, repositioning their brand to regain the goodwill.
 Q2. Avoiding the accusations

 At first learn about consumer perception of target market.

 Focus more on the benefits of breast feeding.
 Suggest their product as supplementary or use it in special cases.
 Offering low cost medical diagnosis service.
Q3.Suggetions for the companies for protecting itself
in future
• Before entering into a new market, the marketer should gather proper
knowledge about the history and culture of the target market.
• They should do more study about medical effects of their products
because they are providing such an important for human beings.
• They should not only care about making profit but also their
consumers interest.
• They should promote healthy eating habit for mothers during her
pregnancy and then baby.
 Q4. Ethical and Socially responsible decisions
In normal business operations, difficulties arise in marketing decisions,
establishing policies, and engaging in business operations in five broad
areas:
 Employment practices and policies
 Consumer protection
 Environmental protection
 Political payments and involvement in political affairs of the country
 Basic human rights and fundamental freedoms
Ethical business conduct should normally exist at a level well above the
minimum required by law or the “controlling legal authority”.
 Q5. Advice for Nestle

Continuous effort to show the benefits of breast feeding.

Conducting programs to ensure women health and educate them to
have proper nutrition and sanitation.
Conducting research to know the means by which reducing the risk of
affecting by HIV from mother to child.
Thanks you……