Customer Satisfaction Using a Same Marketing Segmentation

Customer Satisfaction Using a Same Marketing SegmentationINTRODUCTIONNestl is a transnational company and is of the worlds largest in food and beverages industry. Heinrich Nestl, whom to a fault known as Henri Nestl, was the founder of Nestl Company (Nestle. 2010, Introduction, Nestl Online uncommitted at www.nestle.com), which headquarter is in Vevey, Switzerland in the category of 1866. Nestl Malaysia was established in the year of 1912 in Malaysia as Anglo-Swiss Condensed Milk Company. Nestl Malaysia head office is now located in Mutiara Damansara, Petaling Jaya, Selangor, and has 6 sales offices with more than 5000 employees nationwide. Besides, Nestl manufactures its own crops in 7 factories and grocery stores over 300 Halal products across the nation. (Nestl. 2010, Nestl in Malaysia, Nestl Online available at www.nestle.com.my) Nestl specialized in foods and beverages industry, a few of the many rise known brands Nestl has in Malaysia includes Maggi, Nescaf, Milo, Kit Kat, Nesvita (formerly known as Nestum), as well as pet c atomic number 18 products such as Purina and Friskies.Nestls vision (Nestl. 2010, Corporate Philosophy, Nestl Online available at www.nestle.com.my) is to be the leader in Nutrition, Health, and Wellness Company by delivering world-class products of the broad(prenominal)est consistent quality, reliability, and convenience based on business excellence principles throughout the operation. Nestls mission (The Nestl Corporate Essence Our roots and wings 2007, p.4) is to enhance the quality of life with good food and beverages, everywhere, so people could live a healthier life. In identify to achieve their vision and mission, Nestl Nutrition Research Centre (Nestl. 2010, Research Development, Nestl Online available at www.nestle.co.jp) pays great attention to understand the consumers nutritional and ablaze exigencys and utilise todays world superior science and technology to produce high quality products to the world.MARKET S EGMENTATIONEvery consumer has different needs. Hence, it is not workable to satisfy every customer using a same marketing segmentation, which is also known as mass marketing by offering a single marketing mix to all consumers. Moreover, as a spheric market has become extremely competitive, and consumers are increasingly demanding which is very difficult to satisfy. Therefore, Nestl uses direct marketing for every product to their customers.For example, in consumer product, Nestl baby milk product such as Nestl Neslac Excella Gold is segmented only to infants and toddlers. However, baby does not select the capacity or capability to buy the food they needed. Therefore, to market this baby milk product, Nestl does not fully focusing on babys basic need which is hunger, exclusively also to the babys parents in terms of how the nutrition provided will give their children the best possible advantages in the childrens life and development.Another example is Nestl Milo, the milk bever age with coffee and malt. Don Howart, the executive director of Nestl and Singapore Coffee and Beverages claimed that Milo remains popular among the young and has a 90% (The Sun. 2010, Milo with ProtoMalt to get through the day, Sun2Surf Online available at www.sun2surf.com) market share among chocolate malt drinks in Malaysia. Besides the youngsters, old people and active people are also part of the basin markets of Nestl Milo drinks.However, at first, Nestls business was launched internationally and realised the fact that food products suffer to be taken into account to the local eating and affectionate behaviour due to the circumstance countrys practices, cultures, and traditions. Therefore, (1) Nestl has always shown respect for diverse cultures and traditions and trying to integrate itself as much as possible into the cultures and traditions, adding also to the local surround its own set of values. Therefore, (2) Nestl embraces cultural and social diversity and does not d iscriminate on the basis of origin, nationality, religion, race, gender or age. (The Nestl way and Leadership Principles 2006, p.9)STRENGTHSNestl is a transnational company, not to mention Nestl is also the largest industry in foods and beverages, hence Nestl has every capability to attract more consumers compare to the local companies. On account of its high market share and high financial power, Nestl also has greater financial capability in altering existing products in terms of packaging, the formula of the finicky product and others or creating new products, as well as to adapt or upgrade latest reading administration technology in manufacturing, baseball club processing and other related fields in order to sustain their competitive advantage by delivering dismount cost of goods and services than their competitors in this impulsive environment.Secondly, Nestl has quite an effective strategic marketing capability. For example, Nestl Maggi instant noodles has built a stabl e patent and is very well known in many countries curiously in Australia and Malaysia. This is because Maggi instant noodles is easy to be differentiated from its competitors such as Cintan Instant Noodles. Moreover, Nestl has also developed a very blind drunk brand pertain for Maggi instant noodles because of strong advertising, which has indoctrinated closely of the people to name the other brands of instant noodles as Maggi instant noodle instead of the brands original name.Furthermore, Nestl also has a strong Research and Development operations that helps the company to achieve cross-border synergy such as packaging its global products to local preferences. Nestl also emphasises on using todays information technology, which Nestl believe it will present a long-term opportunity for them to smoothen the companys operation or to increase efficiency in packaging, among any other companys operations. Besides, Nestl also has better technological capability, for instance, to renova te the existing products to be more innovative, high quality, and much healthier product as Nestl realised that consumer-centred innovation and renovation is the most important pillar of Nestls worldwide strategy, which would accelerate Nestl to advance from good to better. (The Nestl Corporate Essence Our roots and wings 2007, p.34) And because of Nestls commitments, more people aver on the products delivered by Nestl because of its proper health and safety measures.Besides, Nestl also has great leadership attri stilles. The leaders such as the top executives, branch managers, and others are responsible for(p) in building organisation capability. For example, the Chairman and Chief Executive Officer of Nestl S.A., Peter Brabeck, (Castelarhost. 2005, Nestl LC1 S.W.O.T Analysis, Castelar Articles Online available at www.articles.castelarhost.com) emphasises internal growth worldwide, which means to achieve higher volumes of sales by adding value to the products, renovate existin g products, and innovate new products, to keep pace in the industry because of rapidly changing of consumer expectations.PROBLEMS AND SOLUTIONSNestl produces hundreds of products, has a global network of suppliers, and multiple distri hardlyions and selling channels. Hence, to anticipate and respond in this rapidly changing in market demand condition is very difficult. When forecasting a market demand, Nestl will need information to detect shifts in demand early so they could adjust for trends and send the just messages to the suppliers, shippers, and distribution centres before they are flood with unwanted or defective goods or dearths. (Manhattan Associates. 2010, Planning and forecasting Anticipate and Respond to Changes in Demand, Manhattan Associates Online at www.manh.com)However, every company has its weakest think, so is Nestl. The weakest links are issues they are inefficient to control. (Labs. 2010, Supply Chain Efficiency Starts at the Top, Food Engineering Online ava ilable at www.foodengineeringmag.com) Firstly, the most common problem is the sources of egress of raw materials. This is due to a sudden and unexpected increased in demand, which will cause extreme hang on shortages for commodities that will result in major price increases. For instance, bad weather and natural disasters have always been an issue affecting incoming raw materials. Secondly, the inaccuracy of orders received in inventory. No company can ever achieve the requirement of zero defects especially in foods and beverages industry. For example, when the purchasing department of Nestl ordered 10,000 of mixed berries yoghurt from its dealer, but what the retailer received was only 8,000 of mixed berries yoghurt, or on another occasion they might received defective inventories. Another example is, when Nestl tells its dealer that they needed extra orders of a particular product to be shipped right away because of unexpected increased in demand, but in fact, the supplier may already has orders from other customers. This usually pass on during special occasion such as Chinese New category, the demand of Nestl Cornflakes cereal will increase because many people will buy this product to make cookies. This will causes Nestl to encounter a great loss because of inaccurate order of magnitude because they could not produce the actual output needed.Therefore, in order to solve these problems, it is crucial for Nestl to engage with multiple suppliers or dealers in that particular region, so they could acquire inventories from multiple dealers, which will definitely decrease the risk of shortage due to incontrollable situation. Besides, Nestl should also base on their demand and purchase planning on last couple of years of sales to forecast current year of demand and supply. Other than that, mutual trust and strong relationship with all the dealers are needed in order to increase the flexibility of material supply management, as well as to enhance the bargainin g power of Nestl. However, if there is a surplus, Nestl may need to plan a promotion to clear their inventories, other Nestl will encounter a great loss such as paying high material handling cost, waste of warehouses space, or inventories that are not sold became defective and may need to be disposed which no profit will earn. Therefore, when there is a big event organized such as Jom Heboh Carnival. Nestl will set up a booth at the carnival to sell its products, which are close to the expiry date at lower price such as Maggi products, Nescaf, Milo, yoghurt drinks, Nestl ice creams and so on. People often buy the products in big quantity because of the lower price than the market price. As a result, Nestl could clear their inventories rather fast and save some space in the warehouses. which is a win-win situation.Thirdly, even though Nestl has a logistics department but it doesnt deal with transportation logistics. Nestl outsourced its supply chain transport to the third-party logi stics (3PL) as Nestl tries to cut their supply chain costs and to concentrate more on their in-plant operations. Although Nestl doesnt have a transportation logistics department, but they do have a preservation team to cooperate with the third-party logistics in routing protocol. Nestl is using a Dynamic Source Routing (DSR), which is a unanalyzable and efficient routing protocol designed specifically for use in multi-hop wireless ad hoc networks of mobile nodes. The protocol is composed of the two main mechanisms of Route baring and Route Maintenance, which work together to allow nodes to discover and maintain routes on-demand to arbitrary destinations in the ad hoc network. (Maltz. 2003, The Dynamic Source Routing Protocol CMU Online available at www.cs.cmu.edu) Therefore, the delivery team is there to help Nestl and the 3PL that DSR is working as per company direction as well as DSR performance.Next, it is the poor partnership relationship between dealerships and consumers. De alers need these capabilities because they, in close partnership with manufacturers Nestl, are a connecting hub of services for the consumers, and other stakeholders. However, Nestl solved this problem by using the Dealer Management Systems (DMS) as well as their dealers. DMS is a software solutions that provide tools for managing sales, services, parts and inventory management, business management, integration, and core architecture. DMS help manufacturers and dealers create integrated marketing campaigns to offer inventory to butt end markets. This will integrate innovations into traditional in-store sales and service processes and offer technologies for non-traditional merchandising, sales, and service strategies through alternative channels for consumer engagement via Web, by phone, or in-vehicle. (Microsoft Corporation. 2008, Microsoft Offers the Dealer Management Solution Microsoft Online available at www.microsoft.com/automotive)RECOMMENDATIONSAfter the reviews stated above , those were not the only solutions that are available. MDZ has come up with a few recommended suggestions that may work or solve the problems that were encountered by Nestl. Instead of just finding or having multiple suppliers, Nestl could acquire the inventories from the other outlets from the other region. Because some regions have different demographics, for instance, race. Some areas have higher percentage of Malays such as Kuantan, Pahang, and some may have higher percentage of Chinese such as Ipoh, Perak. The Chinese New Year (CNY) example stated above, in Kuantan area, there might be less demand during CNY, so to prevent shortage, Nestl could just acquire the inventories from Kuantan. However, if there is a surplus, and unable to clear the inventories at a short time, Nestl could consider benefaction for short-run purpose, this could help to clear the old stocks, as well as to help the donation receivers and build better goodwill and name of Nestl.Secondly, Nestl is a multi national company it definitely has the capability in owning a transportation logistics department. Because of the hundreds variety of Nestls products, 7 manufacturers in Malaysia, as well as thousands of customers such as retailers, wholesalers, distributors and so on, Nestl could handle its own transportation service. Nestl could gain the whole power in such as mode selections, routing, and others. They could do almost anything such as consolidating different type of products but to the same outlet. Besides, they could save every penny they use in transportation cost compare to third-party logistics (3PL) because 3PL charges according to the quantity, inventory storage space, value added processes such as special handling, and more. It may benefit in the short run, but definitely not in the long run, as Nestl centred in the long-term business and strives to achieve effectiveness and efficiency.Lastly, Nestl could use both manual and automation organization in managing sales, servic es, and others. This is because one cannot trust wholly to a machine, as it may not be documenting the steps in its own processor. Because some steps bevel square be automated and may required operator intervention to prevent the escapement processing steps, even though adapting advanced technologies could help saving cost as labour cost is reduced, but if there are still problems occur, it will affect the business such as loss of customers because of the mistake. Therefore, Nestl must update the system software regularly and full utilisation of available technology as well as the manual operators, which will effectively increase the efficiency and reliability of the supply chain systems.CONCLUSIONNestl exerts great efforts to achieve its visions to be the leader in Nutrition, Health, and Wellness Company by producing better quality of products to the consumers. Nestl also examine about the consumers needs from time to time and satisfy the consumers as much as possible. Nestls st rengths such as high financial capability, effective strategic marketing capability, strong research and development, as well as great leaderships have helped them through the obstacles. Above all, Nestl focuses on its missions and ensures consistency by making the right decisions to manage and build its business to deliver the promise of Good Food, Good Life all over the world.