A STUDY ON CUSTOMER SATISFACTION TOWARDS NESTLE PRODUCTS

INTRODUCTION

Nestlé is one of the world’s largest nutrition Company in India. It is catering milk

products, beverages, food items, bottled water, juices, and breakfast and confectionary items.

Keeping the market taste in view Nestle has recently launched a new products. Popular

Nestle brands entered this part of the sub continent during Indian rule and the trend continued

during pre-independence days of India. After independence Nestle World Trade Corporation,

the trading wing of Nestle, sent regular dispatches of Nestle brands to India. By that time

some of the brands such as Nespray, Cerelac, Lactogen, Blue Cross etc. became household

names. Nestle products is the finest and 100% pure products among all other brands and it’s

a flagship brand among other Nestle products. The price of Nestle products is competitive

and they are using all sorts of advertisement material and concepts to target their market.

Their major competitors are Shezan All pure, Haleeb Good Day and other imported brands.

The market share of Nestle products is 60%. The research problem that we were told

by the Company was to know the reason of decline in sales of Nestle products in India.

Nestle products being the flagship brand showed declining sales this year which was the main

area of concern for the Company. The sales growth declined from 20% to -1% within this

year. The information needed to solve the research problem included information regarding

marketing mix, competitors, customer taste preferences and lifestyles etc.

1.1 CUSTOMER SATISFACTION

Customer satisfaction of nestle products is an emerging phenomenon that is considered a vital

issue for which the business firms are very sensitive. The main objective behind its

improvement is to see the consumer purchasing behaviour which is very important in

company’s performance and maintain sustainable growth in a highly competitive

environment. The concept of customer satisfaction is very crucial due to its importance in

business performance and benefits for an organization.

This study aims at:

 To examine the various factors influencing nestle products?

 To study the impact of customer satisfaction on nestle products.

 To investigate the role of brand performance in customer satisfaction .

 To investigate the role of brand efficiency to improves customer satisfaction .

 Empirically investigates the role of customer satisfaction for enhancing of nestle

products.

Customer satisfaction can be defined with the use of two basic concepts: transaction based

satisfaction and cumulative satisfaction. Transaction based satisfaction is based on the

evaluation of a specific purchase once the selection has been made and the product has been

purchased. On the other hand, cumulative satisfaction is based on the overall experience after

the purchase and use of the product/service over a certain period of time. With respect to the

definitions above, the former is more suitable for the authors of this article, since their

research is focussed on customer satisfaction with nestle product. Furthermore, satisfaction

can be defined and measured as consumer ratings of specific attributes and can be defined as

a comparison of previously held expectations with perceived product or service performance.

With respect to the focus of nestle product quality, we have defined customer satisfaction as

a subjective reflection of this quality.

In researching satisfaction, firm generally ask customers whether their product or service has

met or exceeded expectations. when customers have high expectations and the reality falls

short, they will be disappointed and they may discard or stop using the nestle product. Thus
every marketer should give importance to customer satisfaction. In other words consumer

satisfaction is one of the major goals of marketing.

1.2 STATEMENT OF PROBLEM

The study is conducted to find out the level of consumer satisfaction of nestle products with

reference to nestle product. The study helps to make sound decision both in preventing and

solving customer problem. customer satisfaction survey is a procedure by which consumer

report their feelings and interest towards the product they use or prefer. Individual responses

are combined and analyzed that how the quality and price of nestle baby food products can

influence the satisfaction level of consumer.

1.3 SCOPE OF THE STUDY

As learning is a human activity and is as natural, as breathing. Despite of the fact that

learning is all pervasive in our lives, psychologists do not agree on how learning takes place.

How individuals learn is a matter of interest to marketers. They want to teach consumers in

their roles as their roles as consumers. They want consumers to learn about their products,

product attributes, potential consumers benefit, how to use, maintain or even dispose of the

product and new ways of behaving that will satisfy not only the consumer’s needs, but the

marketer’s objectives. The scope of my study restricts itself to the analysis of consumer

preferences, perception and consumption of Nestle Chocolates. There are many other brands

of chocolates available but my study is limited to two major players of chocolates leaving

behind the others. The scope of my study is also restricts itself to Coimbatore region only.

1.5 RESEARCH METHODOLOGY

This chapter describes the methodology of the study. This project is based on information

collected from primary sources. After the detailed study, an attempt has been made to present

comprehensive analysis of consumption of nestle products consumed by the people. The data
had been used to cover various aspects like consumption, consumer’s preference and

customer’s satisfaction regarding Nestle chocolates products. In collecting requisite data and

information regarding the topic selected, I went to the residents of Ludhiana and collected the

data.

DATA COLLECTION:

The data, which is collected for the purpose of study, is divided into 2 bases:

Primary Source:

The primary data comprises information survey of study of consumer satisfaction towards

Nestle products”. The data has been collected directly from respondent with the help of

structured questionnaires.

Secondary Source:

The secondary data was collected from internet, References from Library.

Survey design:

The study is a cross sectional study because the data were collected at a single point of time.

For the purpose of present study a related sample of population was selected on the basis of

convenience.

Sample Size and Design:

A sample of 100 people was taken on the basis of convenience. The actual consumers were

contacted on the basis of random sampling.

TOOLS USED : Percentage analysis

A percentage is a part of a whole. It can take on values between 0 (none of the whole) and

100 (all of the whole). The whole is called the base. The base must ALWAYS be reported

whenever a percentage is determined.

FORMULA: % = f/N*100

%= Percentage

f=frequency

N=number of cases

1.6 LIMITATIONS OF THE STUDY

In attempt to make this project authentic and reliable, every possible aspect of the topic was

kept in mind. Nevertheless, despite of fact constraints were at play during the formulation of

this project. The main limitations are as follows:

 Due to limitation of time only few people were selected for the study. So the sample
of consumers was not enough to generalize the findings of the study.

 The main source of data for the study was primary data with the help of self-
administered questionnaires. Hence, the chances of unbiased information are less.

 People were hesitant to disclose the true facts.

 The chance of biased response can’t be eliminated though all necessary steps were
taken to avoid the same.

CHAPTER SCHEME
 Chapter 1 deals with introduction customer satisfaction and design of the study
  Chapter 2 deals with Review of literature
 Chapter 3 deals with company profile.
 Chapter 3 deals with Analysis and interpretation of data
 Chapter4 deals with summary of findings,suggestion and conclusion.

1.4 OBJECTIVE OF THE STUDY

This project is based on the study consumer satisfaction Nestle products. Objectives of the
study are:

 The other objective is to know about the customer satisfaction level associated with
the product and the customer preference level.
 To increase customer satisfaction and recapture the market share by fulfilling the
customer needs.
 To study the factors affecting the consumption pattern
 To analyze the effectiveness of promotion campaign of Nestle products on consumers.

 To determine consumer awareness about the product

 To determine quality of Nestle Products.

2.REVIEW OF LITERATURE

Parasuraman, Zeithaml, Berry, 2008 A number of research studies have been

conducted recently to highlight the relationship of customer's satisfaction and quality of

service Parasuraman, Zeithaml, Berry, 2008. Perceived service value is one of the

competitive advantage factor and fundamental predicator of customer satisfaction.

Bolton, Drew 2011 The use of latest technology in delivering the service quality is

imperative for the organization. The organizations should be conscious about the impact of

service quality on profits and what level of service quality must be delivered to retain

customers. Employees responsiveness, motivation, selling skills, attitude, training, clearer

role and perception and knowledge of the after sales service are the elements which can be

judged and have a tangible impact in the after sales service and plays very important role on

the goodwill of the company and increase the credibility of the organization and enhance the

trust and confidence of the customer.

Bitner,2000;Merchant Account Glossary points out that "Customer satisfaction is an

ambiguous and abstract concept and the actual main station of the state of satisfaction will

vary from person and product or service to product or service.

According to Norman and Ramirez (2004), companies can relieve customer’s work

load by tackling certain issues, but at best, companies canenable a better capability to

complete certain tasks better. Product or services that enable to perform their tasks require a

deeper understanding of the customer’s business.

(Koller, 2007). Marketing activities strive to produce customer satisfaction with the

four product, promotion, price and place Many companies perform the "place" function of

physical distribution separately from marketing. However, it is likely that physical

distribution through the provision of customer service contribution to success of a company

and can enhance customer satisfaction.

Paul Rozin (2009) in his article states that Chocolate is the most craved food among

females, and is craved by almost half of the female sample (in both age groups). Although
this craving is related to a sweet craving, it cannot be accounted for as a craving for sweets.

About half of the female cravers show a very well defined craving peak for chocolate in the

premenstrual period, beginning from a few days before the onset of menses and extending

into the first few days of menses. There is not a significant relation in chocolate craving or

liking between parents and their children.

Sarah Hagget (2000) says that a controversial, government endorsed campaign to

tackle obesity by encouraging children to exchange chocolate bar wrappers for sports

equipment. A company like Cadbury is capable of delivering 12 million messages into the

market place and engaging young people in positive dialogue. Under the scheme, school-

children get “free” equipment when they collect tokens from Cadbury chocolate bars. It has

been calculated that children need to collect tokens from 5440 chocolate bars for a net and set

of volleyball posts.

Lipp (2005) in his view states that his work reviews the literature on the

compositional data of vegetable fats used or proposed as alternatives to cocoa butter in

chocolate and confectionery products. Cocoa butter is the only continuous phase in chocolate,

thus responsible for the dispersion of all other constituents and for the physical behavior of

chocolate. Unique to cocoa butter is its brittleness at room temperature and its quick and

complete melting at body temperature. There were, and are, strong efforts to replace cocoa

butter in part forchocolate production for technological and economic reasons.

Philip K. Wilson (2012) from his view says that in 1753, the noted nosologist, Carl

Linnaeus, named it The obroma cacao, food of the Gods. Two and a half centuries later,

Joanne Harris emphasized this exotic’s erotic sensations in her award winning fiction debut,

Chocolat. For millennia, healers have touted its myriad medicinal, yet mystical, abilities. By

the 1950s, chocolate, what had long been used as a drug, a food and as a source of currency,
was being marketed merely as a pleasure-filled snack. Over the next half century, the craving

to carve out chocolate’s healthy, medicinal qualities resurged.

Jan Wollgast (2000) feels that Cocoa beans are rich in polyphenols in particular

catechins and proanthocyanidins. However, a sharp decrease in quantity occurs during

fermentation and drying of cocoa beans and further retention has been reported during

roasting. Characterisation and in particular quantification of polyphenols in chocolate has

only been developed relatively recently. This work reviews further on the literature on the

available methodology for analysis, quantification, isolation, purification, and structure

elucidation of polyphenols in cocoa components and other commodities. The characterization

and quantification of the polyphenol composition is amongst the first steps to be done to

evaluate a putative contribution of chocolate to human health.

3. COMPANY PROFILE

Although Nestle has been associated with India since the beginning of the century

through the importing and trading of infant food and condensed milk, manufacturing in India

only began with the setting up of the factory in Moga in 1962. The first product to be
manufactured was Milkmaid. In the last 35 years the company has shown rapid progress and

has increased its product range to 80 products as of October 1997. Nestle India Ltd. now

ranks 22nd amongst India’s most valuable companies (Annexure B) . Its gross revenue has

increased from Rs 1001.1 crores to Rs. 1213.8 crores in 1996. This remarkable growth has

been achieved through -

 Rapidly creating greater manufacturing capacity, both at factories as well as with co-

packers.

 Taking measures to ensure availability and improved quality of key raw materials - fresh

milk in particular.

 Strengthening of the sales and distribution network (particularly in smaller towns)

 Ambitious and cohesive manpower training and development programs for the personnel

of the company across all disciplines.

The company’s exports also resulted in a very successful year in this area as exports

grew by 27% to Rs. 250.8 crores in 2003. The main contributors to this increase were the

export of tea and coffee to USA, Japan, Russia, Hungary and Taiwan.

HISTORY

Nestle India Ltd. is a part of the Nestle SA group which is one of the largest

manufacturing companies in the world. Henri Nestle founded the company in 1867. Nestle

has two major divisions -Le Society des Products which looks after the production and

marketing and Nestle Ltd. which provides the technical assistance to the group companies.

Since its inception in 1867, the company has diversified it product range from the infant

weaning formula (which was its first product) to beverages, confectionery, ice creams and pet

foods among others. In a span of 130 years the company has ranked 26th among the world’s

largest corporations and boasts of a turnover of $48932.5 million and employee strength of
221,144 people spread over 75 countries worldwide Nestle has long been viewed as one of

the most multinational of the multinationals. This is because today only 2% of its turnover

comes from Switzerland. Out of the remaining 98%,Europe contributes 43.5%, North and

South America contribute 36.5% and Africa and the Asia Pacific Regions contribute 18%.
The Spirit of Nestle

“Organisational excellence is never achieved through a one time effort; It is always a

process of continuous improvement across a number of areas of operation.”

A key factor for Nestle’s success has been its quest for continuous improvement

through ushering in greater productivity and more efficiency in everyday operations. Despite

the infrastructure impediments in India, Nestle has set itself high standards of business

performance. This is reflected through the essence of the company - its mission statement.

Nestle’s mission

“To be in every way the leading company in the Indian food industry and a good

corporate citizen by providing our consumers with superior quality products, our shareholders

with rapid growth & fair returns and our employees with a challenging and satisfying work

environment.”

To translate this spirit into a planned and measurable process, Nestle has set up key

objectives across all divisions.

Key Objectives

Production

 To optimise production costs while enhancing product quality so as to make Nestle

products even more competitive in the market place.

Sales and marketing

 To reach a sales turnover of 3000 crores by the year.

 To double the turnover every three years

People

 To help employees to retain a long term perspective and integrate them fully with the

company’s business goals

 To retain a broad perspective while addressing individual needs

 To view growth as a continuous process

 To concentrate on attitudinal changes by developing leadership skills, an appreciation of

interdependence between units and the enhancement of a sense of belonging to Nestle.

Finance

 To maintain profit levels above the average for the food industry in India.

The Business Excellence and Common Application (BECA) initiative essentially translates

the spirit of the Journey towards excellence into an organised, systematic and measurable

approach. The aim is to aid the achievements of the company’s key objectives of rapid

growth by ensuring that all operations incorporate the spirit of meaningful planning, effective

cost control and efficient implementation. BECA is about “ planned improvement in

everything we do ”