Brand Management Case: the dramatic Tale of Maggi in India

When I was a child, my mother used Maggi noodles as the ideal incentive to force me to comply. Maggi was ALWAYS the "Oh! so delightful" reward, whether I assisted her with household tasks or a reward for good grades.

If you haven't battled with your siblings for a more significant part of India's favorite "comfort food" to quell nighttime hunger pangs, you are probably living under a rock.

For the majority of us, Maggi's brand identity evolved to stand for the rush of nostalgia, a dash of delight, joy, and playfulness.

"Maggi is to instant noodles what Google is to search engines."

How, then, did Maggi noodles manage to captivate the collective imagination of a nation (and, mind you, a nation of 1.4 billion people!)? More importantly, how did it alter conventional eating habits in a country that was "rice and wheat" obsessed?

Maggi's brand has been repositioned from a dud product to India's favorite snack.

Maggi arrived in India in 1983, marketed as a convenience item for working-class women. The Indian middle class had never heard of instant noodles before, let alone given them any thought or tried them. In the category, the product had a first-mover advantage, but not so much in the eyes of consumers. The early sales numbers could have been more significant.

However, Nestlé chose to decipher a proper consumer insight because it was still committed to the product. Indians are used to eating rice and wheat for their significant meals (lunch and dinner). Nestlé had to locate a situation in which Maggi would fit perfectly. After careful consideration, "Evening snacks" proved to be Pandora's box Maggi required for its comeback.

Kids usually whined about hunger when they got home from school in the evening. While other options, such as potato chips and biscuits, were viewed as unhealthy, homemade snacks took a long time to prepare. Maggi finally reached a breakthrough! It retargeted children, teenagers, and college-going students who yearned for delectable, quick-to-prepare snacks between meals.

Following a successful repositioning strategy, Maggi created a strong brand culture using exterior and internal clues to express the Modern Indian mentality.

Building recognizable brand signals for Maggi in India

Brand cues combine verbal, written, and visual tales influencing customer purchase decisions and brand perception. How did Maggi use them to become so recognizable?

Strong Visual Cues:

• Maggi uses vivid color cues known to increase appetite, such as red and yellow.
• The logo and packaging's visual coherence invokes nostalgia and makes the brand appealing to people of all ages.

Evergreen Communication

• The term "2-minute noodles" used to promote the product's convenience launched a cultural trend for the company.
• Maggi heavily used emotive storytelling to highlight indulgent moments in the mother-child relationship and spread the notion that young people with an independent spirit best represented contemporary India.

Powerful Distribution

• Maggi used Nestlé's size and supplier dynamics to get to every part of the nation. This improved its competitive shelf visibility and broadened its penetration into the remote hinterlands.

Maggi experimented with product flavors and packing quantities over time at a consistently low cost to be available to everyone. Because of the brand's legacy, within 25 years of its launch, Maggi had a market share of 90% of the instant noodle market. More than 20% of Nestlé India's income came straight from Maggi noodles and the brand's ancillary goods (soups, sauces). And it was also Nestlé India's largest brand, with a value of 1500 crore INR ($235 M).

The "infamous" ban: damaged trust and brand complacency

Until the summer of 2015, our favorite noodles had a fairytale-like existence. Authorities in charge of food safety and regulation discovered higher than allowed lead amounts in the noodles, which set off the nightmare.

Because Nestlé misjudged the gravity of the situation, it casually refuted these accusations and could not prevent customer confusion (if any!). The public interpreted the brand's laziness and silence as confessions of guilt. Parallel to this, media outlets started aggressively covering stories until they became viral, seriously hurting brand perception. The brand collapsed more quickly than any stock market as consumer rage increased.

"You can be so right and yet be wrong in this situation. We had solid factual points, but our argumentation could have been better."

• Nestlé Global CEO Paul Bulcke.

According to Nestle's first quarterly loss in three decades, Maggi's market share decreased from an astonishing 80% to below 5% in just one month. Maggi was subject to a broad national prohibition, and all significant stores withdrew the product from their racks.

Six weeks were given to Maggi to demonstrate its safety requirements. It eventually passed the test and returned to the shelves, but regaining the consumer base was too much work. Parents were quite worried about giving Maggi to their kids.

Brand influencers and endorsers no longer desire to be connected to the brand. And numerous rivals strategically filled the gap left by its impolite absence. With ITC's SunFeast Yippie, Nissin's Top Ramen, Ching's Secret, Wai Wai, and HUL's Knorr occupying most of the market, it became highly fragmented.

Crisis Communication & Agility in the Reconstruction of a Failed Empire

The most significant mistake made by Nestlé was failing to understand and, more importantly, respect the offended consumers' feelings. Their communication throughout the crisis was, by all means, abrupt and formal, missing the personal touch and the humility to accept errors.

Maggi responded to the new age of information consumption, "Social Media," to actively engage with people once the company discovered its wrong ways.

Comprehensive monitoring revealed critical customer sentiment data and told the brewing PR problem. Nestlé then launched a "We miss you too" campaign to highlight a group of Maggi devotees sharing stories about their love for the noodle in a Maggi-less world while increasing their advertising and promotional spending.

"Social media and digital platforms are crucial to our brand-building strategy. When these two work together, brands can achieve great things."

• CEO of Nestle India, Suresh Narayanan

Additionally, Maggi worked with the renowned e-commerce site "Snapdeal.com" to create welcome kits, including a box with 12 packets of Maggi, some gifts, and a welcome back note.

Within just 5 minutes of the Maggi Flash Sale, Snapdeal wholly sold out 60,000 Maggi Welcome Kits. After the sale was resumed, hashtags like #DILKIDEALWITHMAGGI were popular on Twitter.

Following a resoundingly positive response to the flash sale, Maggi held several online contests where participants could share their thoughts and feelings regarding Maggi's reappearance. Customers took part enthusiastically, flooding the brand's Twitter, Facebook, and YouTube pages with messages supporting Maggi.

Thus, the firm prepared the ground for Maggi's official return to Indian store shelves. By the third quarter of 2016, Maggi had quickly reclaimed a market share of 57%, regaining a sizeable portion of its former glory.

Finally, ALWAYS GET IN TOUCH WITH YOUR CUSTOMERS!

India's Maggi dilemma serves as a reminder of the importance of constantly being sympathetic to public opinion. Being right never matters in life. I think finding a solution and engaging correctly is critical.

In a time of difficulty, one should maintain foresight. Always be prepared for the unexpected and think forward. To create a balanced portfolio and lessen reliance on a single product, the corporation engaged in extensive product extension, creating 42 new goods and variants. The company emphasized nutrition and health more, streamlined its business structure, and expanded advertising. The most notable advancements, however, were made in the PR and communication machinery.

The rest is history and a crisis management case study, as we all know.