GROUP ASSIGNMENT 2: ANALYSIS ON MARKETING ENVIRONMENT PDF

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Summary

TABLE OF CONTENTS ACKNOWLEDGEMENT .............................................................................................................. 1 INTRODUCTION ............................................................................................................... 1 Brief History ...............

Description

TABLE OF CONTENTS ACKNOWLEDGEMENT..............................................................................................................2 1.0

INTRODUCTION...............................................................................................................3

1.1 Brief History...........................................................................................................................3 2.0

MICROENVIRONMENT..................................................................................................5

2.1

Company..........................................................................................................................5

2.2

Supplier............................................................................................................................5

2.3

Marketing Intermediaries...............................................................................................6

2.4

Competitors......................................................................................................................6

2.5

Publics...............................................................................................................................7

2.6

Customers.........................................................................................................................7

3.0

MACROENVIRONMENT.................................................................................................8

3.1

Demographic....................................................................................................................8

3.2

Economic........................................................................................................................11

3.3

Natural............................................................................................................................11

3.4

Technologies...................................................................................................................12

3.5

Political...........................................................................................................................14

3.6

Cultural..........................................................................................................................15

4.0

CONCLUSION..................................................................................................................16

REFERENCES..............................................................................................................................18

M K T 4 2 0 - A N A LY S I S O N M A R K E T I N G E N V I R O N M E N T- N E S T L É |2 ACKNOWLEDGEMENT Firstly, all the thanks to God, the Almighty, our group assignment is a complete success for His showers of blessings. The task was carried out by all the group members, even though there were a few problems among us while doing this assignment. Luckily, we could sort up all of the issues and manage them wisely and adequately. We would then like to express our sincere gratitude to Professor Madya Dr. Rozita Binti Naina Mohamed, the lecturer of Principles and Practice of Marketing (MKT420), to do assignments and provide invaluable guidance throughout this assignment. She is always there for us if we are in trouble or tricky doing the mission and explaining as clearly as possible. We are incredibly grateful for what she's been offering us. Thank you to our parents, then mentally and physically, to help us finish this task during our studies. Thank you for all your encouragement and corporation to understand our situation during this hectic week. Thank you for your support, prayers, caring, and sacrifices to inform and prepare us for our future. Finally, I would like to thank our beloved friend who still sticks together and works hard for a successful assignment with every commitment and obligation. I assume that all of this will add a lot of benefits to our group evaluation. Millions of thanks also to all of our classmates, because they help us do our group assignment. They always willingly helped us out with their abilities as much as they could. Thank you very much for all your love, my friends.

M K T 4 2 0 - A N A LY S I S O N M A R K E T I N G E N V I R O N M E N T- N E S T L É |3 1.0 INTRODUCTION Nestlé is the multinational corporation that we have selected for our project. The corporation started in Switzerland as a Swiss international food and beverage company and one of the world's giant food corporations. They also lead agricultural suppliers and industry leaders in coffee and mineral water, and various products. Nestlé uses the symbol of coat of arms and the bird's nest, which means that the product is of higher safety and quality for the consumer. Nestlé always supplies adequate food relevant to the nutritional, health-related consumer profitable business. The organization also added infant food, frozen food, bottled water, yogurt, biscuits, milk beverages, ice cream, breakfast cereals, pet food, and other treats. Nestlé is one of the world's biggest beauty industry owners, L'Oréal (Wikipedia, Nestlé, 2021). The Nestlé strategy is guided by a collection of core principles, such as innovation and renovation, which ensure that existing brands grow and balance regional activities and product lines. Number one of priority is to provide the finest and most essential products to its clients. They also believe that actions that have long-term benefits for the company and at the same time benefit the local community. Next, the business strives to be the most prominent brand globally and the most fabulous food brand synonymous with the most delicate quality items. They concentrate more on their mission slogan, "Good Food, Good Life," which illustrates the intent of the company's formation. They influence the social climate in the design of balanced food that helps well-being, cleanses the ecosystem, and produces healthier food.

1.1 Brief History It started with Henri Nestlé, a pharmacist, began producing food in 1855 for children unable to breastfeed. A little boy refused to handle his mother's milk and other alternatives making his first accomplishment to become a successful person. (Wikipedia, 2021). Then citizens quickly realized the value of the latest food, as a new product formula saved one life. Aftersoon, Farine Lactée Nestlé was put on the market in much of Europe, and a new brand name began to come to life. In 1905, Nestlé started to merge with the Anglo-Swiss Condensed Milk Company. At the turn of the 1900s, the corporation operated factories in the United States, the United Kingdom, Germany, and Spain. Consequently, World War I's impact on government contracts had dried up, and consumers had switched to fresh milk. Condensed milk is long-lasting and straightforward to carry, making it

M K T 4 2 0 - A N A LY S I S O N M A R K E T I N G E N V I R O N M E N T- N E S T L É |4 more common among soldiers. But Nestlé management responded by streamlining procedures and cutting debt. Prices began to fall in the 1920s, and Nestlé & Anglo-Swiss lost their stock to a high level. First, Nestlé has expanded to include innovative products, with chocolate being the second most influenced product. In that period, Chocolate Drink Milo was introduced in Australia in 1934. Income dropped from 20 million dollars in 1938 to 6 million dollars in 1937 when World War II. In developed countries, factories have been built, particularly in Latin America. Interestingly, after the war, Nescafe was introduced as the US Army's current business product. After that, the production, and profits of the company in the wartime economy bloomed. In 1960, purchasers for buying freezers increased, and the demand for ice cream increased. Nestlé purchased the frozen food from the Swedish manufacturer Marabou and then extended it to the international market. In 1986, Nestlé bought French yogurt maker Chambourcy and then acquired canned food and took over the American frozen food business (Nestlé, The Nestlé company history, 2021). The downturn in traditional corporate markets partly balances Nestlé's growth in the developed world. In Malaysia, the first factory in Petaling Jaya, near Kuala Lumpur. They started trading in Malaysia in 1912, the Anglo-Swiss Condensed Milk Company. Several of our leading brands have been part of the household for decades, like Maggi, Nescafé, Milo, and KitKat. Their strategies are to go international but act locally. There are currently operating six factories and producing over 500 Halal-certified products (Nestlé, 2021).

M K T 4 2 0 - A N A LY S I S O N M A R K E T I N G E N V I R O N M E N T- N E S T L É |5 2.0 MICROENVIRONMENT The microenvironment is basically an environment that directly affects a company or business. The microenvironment is directly related to the organizational environment and affects the organization periodically. Marketing success requires good relationships with other company departments, suppliers, marketing intermediaries, competitors, customers, and the public who come together to form the company’s value delivery network

2.1 Company The company are an element of the microenvironment. In designing marketing plans, the marketing management department needs to know other departments such as The Top Management Department, Research and Development (R&D) Department, Finance Department, and Human Resources Department. All the departments within a company are involved in shaping the internal environment. In fact, the Nestlé company headquarters is in Vesey, Switzerland. Nestlé business has the support by 86 countries and there are more than 500 factories. For example, Nestlé Malaysia Berhad always ensures the accuracy of financial records and in accordance with the accounting standards set by Nestlé companies to fulfil its responsibilities to stakeholders. The company also encourages the continuous improvement of Nestlé company product sales through professional training and improvement for all levels in the organization.

2.2 Supplier Suppliers are also an element of the microenvironment. Nestlé company organizations need to wisely choose quality materials or labour that are appropriate to the type of business they are running. The supplier is the individual responsible for supplying the resources needed by the company to produce the product or service to the customer. Suppliers play an important role in ensuring the smooth running of a company's business. If the supplier service is of low quality and not delivered on time will affect the planned production and sales time as the production process must be delayed and at the same time will result in little loss to the company. Nestlé company suppliers are divided into two groups that are labour suppliers and raw material suppliers. Labour suppliers play a role in providing the labour needed by companies to optimize their production levels. Nestlé Company in Malaysia has more than 5,800 employees nationwide (Nestlé, 2021). As for the raw material supplier, Nestlé Company takes great care of the quality of the raw material because Nestlé Company is in the food and beverage industry. For example, Nestlé Company continuously obtains grain supply and is guaranteed safe and well-known source because it will be used to produce products such as baby food.

M K T 4 2 0 - A N A LY S I S O N M A R K E T I N G E N V I R O N M E N T- N E S T L É |6 It also helps to reduce Nestlé Company operating costs due to local raw material sources can be obtained at cheap prices. Maintaining good relationships with suppliers can help companies gain advantages over competitors such as reasonable offer prices. This is because if the supplier offers a high price from the business also need to increase the price of the product.

2.3 Marketing Intermediaries Marketing intermediaries play a role in helping companies promote, sell, and distribute their products to end buyers. Resellers are distribution channels that help companies find customers and make sales to the community. For example, Nestlé Company in Malaysia produces its products in 7 factories and then distributes its products through the National Distribution Center to its retailers such as supermarkets such as Giant, Tesco, Jusco, and department stores such as 7-Eleven, 99-Speedmart (Nestlé, 2008). As we have seen, almost all grocery stores or supermarkets sell Nestlé products whether food or beverages such as milo, baby food, and ice cream. Nestlé works with all marketing intermediaries to ensure customers get a clear picture of the product features released by the company. Marketing intermediaries are one of the key determinants of increased sales of Nestlé Company products. This is because customers will be slow to realize the existence of the product if only the manufacturer companies market the product because customers are closer to the retailer, store department, or online store if they want to get a product. This proves the importance of marketing intermediaries in helping to increase product sales for Nestlé companies.

2.4 Competitors Competitors are also a micro-environment variable and involve companies with comparable products and services. A company must consider who its biggest competitors are in order to be competitive, while considering its own size and position in the market. The company would create a competitive edge over the competitors (Kotler, Armstrong, & Opresnik, 2018). While Nestlé is Malaysia's pioneer in the packed food industry the other rivals who compete rigorously with Nestlé such as Dutch Lady Milk Industries, Lam Soon (M) Sdn Bhd, and F&N Sdn Bhd. Nestlé's history in Malaysia for over a century now has a strong edge over the above-mentioned businesses. An excellent and trusted supply chain and a retail chain network had been formed by Nestlé. For decades, Nestlé's trust among the Malaysian community has also been based on difficult job and quality products and varied different prices, but yet again, after experiencing strong competition with rival companies in chocolate bars, dairy products and other packaged food, the company is capable of retaining its profitability ratios that are beneficial to its investors, other packaged food products and portrayed the decent image to the public.

M K T 4 2 0 - A N A LY S I S O N M A R K E T I N G E N V I R O N M E N T- N E S T L É |7 2.5 Publics A community that has a specific or potential interest in or impacts on the capability of an organization to ensure success. These can be classified as local public, general, and internal, financial, government, media, citizen-action. Concentrating on these major audiences and their consumer markets, marketing objectives can be planned (Agrawal, 2016). Government public will influence the company by passing rules and laws that limit the activities of a company. Financial public are the community influences the ability of the company to get resources. The main financial groups are banks, institutional investors, and shareholders. Citizen-action public includes environmentalists and minority groups and can confront a company's actions and put them in the public spotlight. Local public are the local community groups and will often challenge the influence of a company on the local environment and the extent of obligation for their actions. General public is the consumer base of the company and can impact the business as it may also It may cause profits to go up or down a s any change in their mood, whether positive or bad. Internal public are including the staff, managers, volunteers, and the board of directors are members of this organization. Large companies use letters and other ways of informing their internal public and motivating them. This positive attitude carries over to the outside public as workers feel confident about the company, they serve for. Media public are when the news, features, editorial views, and other material are carried by this group. Television stations, websites, magazines, journals, and other social media are also included (Armstrong, 2012). For instance, Nestlé had been carried out the media public marketing by carried out the advertisement through mass-media such as newspaper and online advertisement for its promotion. Nestlé has a strong social presence that will also allow it to connect with its customers and interact with them and gain additional understanding into their products and other services.

2.6 Customers Customers are the most significant characters in the company's microenvironment. The objective of the value creation supply chain is to communicate and build positive relationships with targeted customers. In simple language, without customers, a company will not survive. (Toppr, 2020) A successful company maintains a close eye on its product lines for both customers and consumers. It must record and track any shifts in the customer's tastes and preferences, along with changes in the customer's purchasing habits. The direct customers of Nestlé are grocery and retail stores that market the products of the organization at a decent price and a rational profit to the end consumers (Nestlé, 2011). The end users of Nestlé are customers who demand a variety of items. In its wider number of direct customers, the company has a strong brand name. Other than that, Nestlé Malaysia also did an outstanding job by localizing its menu to attract the targeted customers especially the local. For example, KitKat has released their limited-edition flavour which is “KitKat Nasi Lemak” with the

M K T 4 2 0 - A N A LY S I S O N M A R K E T I N G E N V I R O N M E N T- N E S T L É |8 unique taste that combines the flavour the chocolate with the Nasi Lemak. Next, the other product line from Nestlé named as NESTEA offers the customers with flavour of Teh Tarik that suits with the local’s tastebud which the locals prefer to drink Teh Tarik in the morning instead of Lemon Tea. It shows that Nestlé Malaysia had adapted the local’s custom and beliefs, and also had improved their brand and also the business.

3.0 MACROENVIRONMENT There are factors in its environment that it has no influence over when a company works in an economy and a society, and they are a factor in its macroenvironment. The macroenvironment is the company's external environment. Since the situation is not controllable by the organization as a rule, it is too wide to operate and unpredictable. The organization's performance will therefore rely, to a large extent, on the ability of the company to adapt and react to these changes in the macroenvironment. The macroenvironment consists of the larger economic, demographic, political, natural, cultural, and technological forces that influence the microenvironment. A company works in a broader macroenvironment with powers that form the company's possibilities and pose risks. In the marketing climate, even the most dominant companies may be exposed against turbulent and changing forces. Some of these are volatile and uncontrollable factors. By expert management, some can be controlled and managed. Companies who recognize their conditions and respond well to them will succeed. The ones who can’t face tough times. This lesson has been taught by many dominant business leaders in the hard way.

3.1 Demographic The first factor of macroenvironment is demographic environment. In terms of occupation, race, age, location, gender, density, size and other statistics, demography is the study of human populations. The demographic environment is of major concern to marketing because it contains individuals and consumers are made up of individuals. The world population is growing at an explosive rate. It now exceeds 7.3 billion people and is expected to grow to more than 8 billion by the year 2030.5 the world’s large and highly diverse population poses both op...