With Milo's relaunch, Nestle builds a millennial track around its brands

Topics nestle | Nestle India | Nestle Maggi

Nestlé says it has taken the digital-first route for many of its brands, such as KitKat and Milo
Last month Nestlé relaunched its malt-based drink Milo, just months after it signed up as the official energy drink for the popular Indian Premier League franchise Chennai Super Kings. A few months earlier, the company introduced three organic variants of its popular brands, including one for infants. To add to the talk of wellness and conscious snacking, the company has been working in a taste-plus-health tagline in its advertising for brands across its portfolio.

Nestlé that has spent over a hundred years in the country and has spent much of the last decade fighting a bruising battle over its flagship brand Maggi says its branding strategy is reflecting the millennial push coming from within its rank and file. While the focus on healthier, premium and organic variantsmay not translate into big sales numbers, experts say that the move will help build a halo around the brand that will stand it in good stead in the years ahead. 

Suresh Narayanan, chairman and managing director, Nestlé India speaking during a meeting for the brand refresh for Milo said, millennial consumers are conscious of what they eat, about the environment and fitness and are ready to pay for quality and nutrition. And Nestlé, despite its age, is a millennial company because he added, it has 70 per cent millennial employees on its rolls. 

Health and nutrition come at a price, but that is where the millennial audience lies. According to the company, its premium products grew nearly 21 per cent during the first half. For its new version of Milo too, the company has opted for a premium track. It is being launched with a 400 gram tin priced at Rs 230, which is much higher than 500 gram jars of Horlicks, Bournvita and Complan priced at Rs 35, Rs 216 and Rs 245 respectively.

"Organic products end up being expensive and unaffordable to the middle class. You could have organic products, but that is more as an image leader, where the move can help build a halo around the brand," said Ambi Parameswaran, brand strategist and founder of Brand-Building.com.

The company says that its move towards a healthier fix for its brands goes hand-in-hand with its thrust on digital marketing and communication. In the last three years, its digital communication has grown 45 per cent year on year, while it has moved away from traditional media. Many brands are connecting to the consumer first on digital now (Maggi, KitKat) according to Narayanan. 

Going digital has meant frequent communication and building a larger social cause around the brand. Hence KitKat’s new campaign has been tailored around the growing penchant for travel within this demographic. 'My Travel Breaks' talks about travel experiences in the country instead of relying on the usual foreign destinations, Narayanan said. “We are hopeful it would help development of infrastructure of tourism in those places. 

We will tie up with local entities so that there would be a positive rub off for employment in these smaller locations," he added. 

The advertising is being localised too, data is being used to define regions more narrowly and audiences are being mapped more accurately. The country has been carved up into 15 clusters on the basis of close to 150 different parameters, set by Nestlé and its partners. The earlier model took a pan-Indian approach to its advertising.

The cluster plan begins with the consumer, Narayanan said. What kind of products, brands, SKUs do consumers in the locality like, where do they like to purchase, what kind of media they use and how many times do they see it – all of these parameters inform the branding strategy for the company. This helps the company to know when, where and how much to spend and organise promotions and activations relevant to the geography. This clustering approach was implemented in two of its smaller markets, Andhra Pradesh and Karnataka and has helped the company to pick up market share. "This is really being at the temple of analytics, using multiple vectors for understanding consumer behaviors, and using this to plan and target our brands," he said. 

The company has already launched 61 new products, despite only 70 per cent being the success rate. But new products contribute around 3 per cent of company's sales and failures help get to know the local conditions better, the company said.

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