Businesses operate in markets that are constantly changing. Consumer tastes and expectations are always on the move. This case study examines a market-focused innovation developed by Nestlé. It explores the development of Maggi 'A Natural Choice': a range of culinary (cooking) products that is primarily targeted at chefs.
Nestlé is the world's leading food company. Since it was set up by Henri Nestlé to provide an infant food product, it has been associated with providing high quality, customer and consumer focused products. In recent years it has focused on becoming a nutrition, health and wellness company. Wellness is about supporting people to live more healthy lives e.g. through the development of probiotic yoghurts that help maintain the balance of the digestive system. The company is a world leader in research and development, and Nestlé's scientists work in all areas to create healthier and more nutritious foods. Maggi is an important brand for Nestlé. It is a global brand - widely recognised as a consumer and foodservices brand in continental Europe. In the UK, Maggi consists of a range of culinary aid products that are exclusively available to the catering trade (known as 'foodservice') - primarily to chefs. Maggi 'A Natural Choice' is a new development that is unique to the UK.
Nestlé FoodServices sells Maggi 'A Natural Choice' to wholesale distribution companies, such as 3663 and Brakes, and Cash and Carry operators such as Booker, who in turn supply chefs and the catering trade. The UK foodservice market is very competitive. Companies must apply high standards to products and their nutritional content to meet stringent food safety and labelling laws. In addition, members of the public are becoming increasing knowledgeable and choosy about what they eat, as a result of food scares and an increase in food allergies, leading to even higher specifications.
The Maggi brand experienced a decline in sales in the UK leading up to 2004. This was because the product had come to be seen as uninteresting and old fashioned due to its dehydrated format and flavour. The product failed to meet users' increasing requirements for fresh tasting culinary aids.
Maggi commissioned face-to-face qualitative research to get a deeper insight into chef and consumer views. Chefs were asked to discuss their requirements.
The results showed that consumerswere saying 'fresh is best'. However, the chefs' view was slightly different in terms of: 'My customers would like everything to be made from scratch (i.e. made from basic raw ingredients), but I don't have the time and money to do this'. The research revealed that the market was divided into a number of segments. A segment is a part of an overall market made up of customers with similar characteristics. Chefs fitted into four main segments:
The research showed a sizeable demand for Segment 3 - a target for Maggi 'A Natural Choice' products. Brand proposition - the research defined a proposition for developing the new brand. This new proposition was to create a product with more natural qualities for 'chefs who aim to please' who want their cooking to be as fresh tasting as possible. Natural qualities would be defined in terms of taste, smell, look and texture. Target market-- Maggi 'A Natural Choice' target was to be 'chefs who aim to please'. Their prime aim is to provide delicious, wholesome foods that customers enjoy. These chefs enjoy their work and have a pride in the satisfaction they give customers. They are not in business just to make money. Brand ambition - Maggi 'A Natural Choice' combines the goodness and taste of real ingredients with time and cost saving.
Research and development
Nestlé's strength in product research and development makes it possible to develop products to fit market requirements. Maggi is committed to providing cutting edge products that chefs want, e.g. products with a lower salt content. These products are high quality and easy to use. The new products need a more natural taste while at the same time offering value for money.
The Maggi 'A Natural Choice' range is now lower in salt and made using sunflower oil. In addition, where possible the range benefits from having no added MSG, is gluten free and contains no artificial colours or flavours. The Maggi 'A Natural Choice' range has clear and easy to understand nutrition and allergy information on all packaging to help chefs understand what is in the products so they in turn can inform their customers. The range is aimed at a variety of chefs. For example, two Maggi 'A Natural Choice' products widely used in school kitchens are:
1. multi-use tomato sauces - this saves time vs using chopped tomatoes. The product is pre-reduced which means less wastage (the juice from chopped tomatoes makes up one third of a tin and is usually poured away) and also less cooking time as the product can be used straight from the tin. It contains sunflower and olive oil and is pre-seasoned with basil and oregano so it can be used straight from the tin. The sauce is mainly used as a pizza topping or a pasta sauce as well as in soup and casseroles, and one serving can contribute to one of the suggested five portions of fruit and vegetables per day.
Maggi also uses easy to understand labels showing nutritional and other information. For example, the multi-use tomato sauce label states:
- there are no added colours or artificial flavours
- there is a low fat content
- the salt and sugar content has been reduced by 25%
- the key nutrients contained e.g. energy, protein, carbohydrates, sugars, fat, saturated fats, fibre and sodium, salt equivalent labelling (if used on brand)
- details of allergenic ingredients used.
2. bouillons (i.e. stock or broth for soup and sauces produced by cooking vegetables, poultry, meat or fish in water, which is then strained) - using a paste or powder bouillon is quicker than preparing stock from scratch and helps to provide a consistent, authentic flavour. They are easy to use, cost effective and there is no waste. Chefs prefer paste bouillon because they believe it dissolves better when added to water. Maggi paste bouillons are ideal for school catering because they are gluten free, contain no added MSG, artificial colours or flavours, are made with sunflower oil and have less than 0.7g salt per 100ml when made up. Bouillons are mainly used as a base to soups and sauces, as well as adding flavour to casseroles and stews.
New product development (innovation and renovation)
Each of Nestlé's European factories is a centre of excellence that specialises in developing new areas of food technology. New paste bouillon research and development is carried out at an Austrian factory. The new Maggi 'A Natural Choice' paste bouillons are created and developed there. New product development involves a number of important stages. To give an idea of timescale, the development process for paste bouillons took 6 months.
At the same time front labels are designed, product photography commissioned, recipe sheets produced and sales presenters are designed to ensure a successful product launch.
Launching to chefs is very different from the launch of a product for the retail environment. This is because it is not easy to communicate directly with chefs, as this target market is made up of busy people who work unsociable hours.
Publicity in the press started 6-8 weeks before the launch. Selected trade media such as Catering Update and Caterer and Hotelkeeper carried advertising and promotional material. Eight page supplements were produced to get the message across. These appeared in the April and May editions of the magazines, along with ongoing features in the wider press. Direct mailing of informative literature to chefs and other users supported this. Promotions including providing opportunities at special events for chefs to sample new products were set up.
Maggi works closely with the main FoodServices wholesalers (3663 and Brakes) and Cash and Carry operators (e.g Booker). This ensures that distribution of Maggi 'A Natural Choice' to caterers and chefs is effective. These companies use a Product Listing Order Form (PLOF), which is updated by negotiation in April and September only. It is imperative to ensure distribution takes place to meet these critical timelines. Wholesalers, together with cash and carry operators, were therefore given supporting promotional material about the new products to coincide with the launch.
Other activities to develop young chefs run alongside Maggi 'A Natural Choice' advertising and promotional activity. Nestlé FoodServices sponsors two major prestigious events for chefs which involve using Maggi 'A Natural Choice' products. The Nestlé Toque d'Or competition is in its 18th year. Nearly every young chef dreams of running their own restaurant. The challenge set is the task of designing a restaurant concept and theme. This includes putting together an exciting menu. Teams of six students work on this challenge.
The other event is the Local Authority Caterers Association (LACA) School Chef of the Year award sponsored by Nestlé FoodServices. This was launched to applaud the skills of many unsung heroes - the school chefs who prepare the daily school dinners. Each entrant has one and a half hours to cook a healthy, balanced main course and dessert within a strict budget. The meal must appeal to 11 year old pupils.
This is an important competition since schools provide an estimated 30% of children's daily food and nutrient intake. The government's Healthy Living blueprint encourages school caterers to help pupils eat sensibly and adopt healthier lifestyles. The LACA School Chef of the Year award recognises the important work going on in school kitchens throughout the UK. These awards, together with the launch of Maggi 'A Natural Choice', are all part of Nestlé's commitment to providing healthier menus within a busy chef's time constraints.
The Maggi 'A Natural Choice' range is designed to combine chefs' requirements for tasty wholesome food with consumers' requirements for more nutritionally balanced, healthier meals. Maggi 'A Natural Choice' is a carefully researched and developed product designed to give customers more of what they want.