Nestle Case Study
Strategy Decision Sheet
1. Decision Making Situation
NHW (Nutrition, Health and Wellness) Industry:
Due to the rise in health concerns and changes in the preferences of food of consumers, the market for nutrition, health and wellness products was increasing. The sales of food and drink products in the same industry reached $570 billion in 2009 and were predicted to rise at 5 % per year over the next few years.
Company: Nestle:
World’s largest food company with sales of $116.62 billion in 2010 and the products marketed in 130 countries.
Its motto is “Good Food, Good Life” which is also reflected in the mission “to provide consumers with best tasting and most nutritious choices in wide range of food and beverage categories”.
Vision: “To become the leading nutrition, health and wellness firm in the world”.
All the strategic decisions related to M&A and product improvements were guided by NHW strategy adopted for 13 years from 1997.The focus was more on achieving long term growth than to bring radical short term changes.
Changes in alignment of NHW strategy:
Acquisition of Powerbar in 2000
Creation of a nutrition strategic business division formed from the executives of different product teams. The division developed the 60/40 + metric in 2003 to measure and improve the product so that at least 60% of the time the consumers prefer Nestle product to competitors in blind test.
Later in 2005, healthcare nutrition, performance nutrition, infant nutrition and weight management divisions were brought under Nestle nutrition.
Investments in R&D and marketing increased.
Rolled out a cross company packaging innovation: Nestle Nutritional Compass to educate consumers about 4 aspects: nutrition info, guidelines for intake and links for consumer service.
Corporate Wellness Unit was also created internally to drive NHW across all companies.
Acquisitions:
May, 2006: Health and cereal manufacturer Uncle Toby’s
June 19, 2006: Jenny Craig, US brand which sold
1. Decision Making Situation
NHW (Nutrition, Health and Wellness) Industry:
Due to the rise in health concerns and changes in the preferences of food of consumers, the market for nutrition, health and wellness products was increasing. The sales of food and drink products in the same industry reached $570 billion in 2009 and were predicted to rise at 5 % per year over the next few years.
Company: Nestle:
World’s largest food company with sales of $116.62 billion in 2010 and the products marketed in 130 countries.
Its motto is “Good Food, Good Life” which is also reflected in the mission “to provide consumers with best tasting and most nutritious choices in wide range of food and beverage categories”.
Vision: “To become the leading nutrition, health and wellness firm in the world”.
All the strategic decisions related to M&A and product improvements were guided by NHW strategy adopted for 13 years from 1997.The focus was more on achieving long term growth than to bring radical short term changes.
Changes in alignment of NHW strategy:
Acquisition of Powerbar in 2000
Creation of a nutrition strategic business division formed from the executives of different product teams. The division developed the 60/40 + metric in 2003 to measure and improve the product so that at least 60% of the time the consumers prefer Nestle product to competitors in blind test.
Later in 2005, healthcare nutrition, performance nutrition, infant nutrition and weight management divisions were brought under Nestle nutrition.
Investments in R&D and marketing increased.
Rolled out a cross company packaging innovation: Nestle Nutritional Compass to educate consumers about 4 aspects: nutrition info, guidelines for intake and links for consumer service.
Corporate Wellness Unit was also created internally to drive NHW across all companies.
Acquisitions:
May, 2006: Health and cereal manufacturer Uncle Toby’s
June 19, 2006: Jenny Craig, US brand which sold