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Wednesday, 16 July 2014

Nestlé seeks "common language"

Warc, 9 August 2013
VEVEY: Nestlé, the food group, is seeking to develop a "common language" that will help it allocate resources more effectively to activities such as marketing and innovation across the globe.

The Swiss multinational trades in over 184 countries, and is attempting to find a meaningful way to measure its operations in highly variegated trading environments against one another.

"How do you compare noodles in India versus pizza in the US versus coffee in China?" Wan Ling Martello, the firm's chief financial officer, said in summing up this challenge on a conference call.

"Having the tools, having a common language, that looks at all the cells - which are basically category in a [given] geography - and putting everything on an equal footing is very important for us."

Nestlé has boosted its consumer-facing marketing spend by 15% over the last six months, with digital recording a 30% improvement.

While Nestlé's outlay in this area is ultimately decided by management teams in individual nations, the firm does set certain standards to be followed worldwide.

"That's one of the core things that we hold our market management responsible for," said Martello. "Our expectation of the market is to make sure that marketing spend is never sacrificed in order to deliver margin."

In terms of specific projects, Nestlé recently boosted it spending in Brazil for the Confederations Cup football tournament, and in preparation for the FIFA World Cup next year.

This impacted confectionery margins in the region, Martello revealed, but the "opportunities to invest" behind its brands during were simply too strong to miss.

Last year, the firm also celebrated 100 years of trading in Singapore and the Philippines, as well as reaching its 90th anniversary in Brazil.

These efforts must be balanced against product launches, introducing existing lines into untapped markets and introducing new systems. "It's a lot of moving parts depending on what's happening," Martello said.

Data sourced from Seeking Alpha; additional content by Warc staff

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