Nestlé India Limited – Financial Analysis

High income households

Middle-class

Size

1.2 million

Assumptions:

1. Roughly 10% of the urban population
2. Life span of kitchen appliances = 5 years
3.  80% would want to have a modular kitchen

1.5 million

Assumptions:

1. 25% of the urban population
2. Life span = 5 years
3. 40% would want to have one

Products

Premium/Lifestyle

1.  Electric chimneys
2. Built in sinks and built in cabinets
3. Installed Microwaves and water purifiers

Cost Saving/Functional

1. Chimneys with auto clean technology
2. Basic cabinets and basic sinks
3. Microwave ovens
4. Repair of the existing kitchen set-up to modular kitchens.

Pricing

The products can be charged at a premium price in order to compensate for the profits that they might not be getting from the cost saving products.

The products should be placed at a low price initially to attract more middle-class families. This would act as a barrier to entry for competitors and would be the perfect opportunity for Veto to use its first mover’s advantage. The prices can be increased later.

Places

1. Few customized stores integrated with its AC stores in high-end malls
2. Places frequently visited by housewives like supermarkets, exclusive home-shops etc.
3. E-commerce

1. Supermarkets
2. Malls
3. Showrooms

Promotion/

Advertising

1. Promotions over the internet, social media , newspapers and real estate and women magazines
2. Offering discounts on AC purchases if Veto’s modular kitchen appliances are purchased.
3. TV Ads
4. Product placement in movies and TV serials
5. Sponsoring events that attract women

Same