Capturing the opportunity from new consumer trends Patrice Bula: EVP, Strategic Business Units, Marketing and Sales

1 | September 26, 2017 | Nestlé Investor Seminar 2017 Disclaimer

This presentation contains forward looking statements which reflect management’s current views and estimates. The forward looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward looking statements. Potential risks and uncertainties include such factors as general economic conditions, foreign exchange fluctuations, competitive product and pricing pressures and regulatory developments.

2 | September 26, 2017 | Nestlé Investor Seminar 2017 Being relevant to a new generation

The right products Experiences Earn trust Be authentic and beyond product benefit society

- Clean recipes - Convenience - Transparency - Our purpose and values - Natural ingredients - Discovery - Empathy - Elevate social dimensions - Proximity - Enable self-expression - Engaged (CSV) - Authenticity - Be share-worthy

3 | September 26, 2017 | Nestlé Investor Seminar 2017 Changing Nutrition, Health and Wellness (NHW) expectations are leading to new growth opportunities

Estimated market size in 2016* (CHF billion) +3% 195 bn

-1% 136 bn

+10% +4% 33 bn +7% +8% 19 bn +12% 7 bn 4 bn 3-6 bn

Natural** “Free-from”/ Plant-based Organic Lactose-free High- Gluten-free reduced protein*** (Reduced fat, sugar, salt, carbs, caffeine)

Source: Euromonitor data 2016, in Nestlé-relevant categories * Market size based on retail sales price, CAGR % 2010-2015 ** Naturally Healthy: Food & beverage on the basis of naturally containing a substance that improves health & wellbeing beyond the product’s pure calorific value *** High protein data not available directly, as new categories are investing in high protein variants. High protein supplements and nutrition products estimated at CHF 9 bn; meat analogues and vegetarian products estimated at CHF 1.5 bn. Rough estimate related to Nestlé categories : CHF 4 bn.

4 | September 26, 2017 | Nestlé Investor Seminar 2017 Consumer expectations are holistic, multi-dimensional and intertwined

5 | September 26, 2017 | Nestlé Investor Seminar 2017 Our core strategy: driving our portfolio transformation at scale

Integrating new NHW Creating new brands Acquiring “born pure” brands dimensions into our core brands and accelerating their growth

6 | September 26, 2017 | Nestlé Investor Seminar 2017 Example: driving “naturalization” of our petcare portfolio at scale

“Naturalizing” the core portfolio Creating new brands Acquiring “born pure” brands

Ancestral diets Regionally-sourced

Human-grade quality Protein-packed for active dogs CHF 375 million*, 51% CAGR** CHF 154 million*, 54% CAGR** CHF 381 million*, 26% CAGR**

*Sales FY 2016, **CAGR (2014-2016) 7 | September 26, 2017 | Nestlé Investor Seminar 2017 Integrating organic as part of our brand offer

Infant formula & baby food Food Dairy

2017: China 2016 - 2018: U.S. 2016: China, Mexico 2017: ASEAN, Middle East 2018: U.S. Coffee Ice cream

2017: U.S., EUR, Mexico 2016 - 2017: U.S. 2018: EUR 2016:

8 | September 26, 2017 | Nestlé Investor Seminar 2017 Authenticity: telling genuine brand stories

Waters Uncle Tobys Ice cream

9 | September 26, 2017 | Nestlé Investor Seminar 2017 Proximity: locally-sourced ingredients

Cailler Herta

10 | September 26, 2017 | Nestlé Investor Seminar 2017 New “free-from / high-with” diets

Gluten-free Lactose-free Reduced sugar High-protein

7% avoid gluten 4% avoid lactose 56% of European adult 75% of consumers increasing consumers reducing sugar protein intake

11 | September 26, 2017 | Nestlé Investor Seminar 2017 Accelerating gluten-free new product offering with superior organoleptics

Food Cereals

2017: EUR 2015+: U.S. 2016: EUR 2017: U.S., Italy

Maggi food service range 2016: EMENA, Mexico, Caribbean, Central 2016-2017: U.S., Canada, 2016: UK & Ireland, , , , , U.S. America EMENA, Australia

12 | September 26, 2017 | Nestlé Investor Seminar 2017 Lactose-free: gaining momentum in LATAM, AOA, as well as premium nutrition

Dairy Nestlé Nutrition Ice cream

2016: Switzerland 2016: , Indonesia 2016: Brazil 2016: Brazil 2016: LATAM

13 | September 26, 2017 | Nestlé Investor Seminar 2017 Naturally reducing sugar

Dairy Confectionery

Up to 30% reduced sugar No added sucrose Up to 30% reduced sugar

14 | September 26, 2017 | Nestlé Investor Seminar 2017 High-protein products

Dairy Food Cereals Ice cream

2016: U.S. 2017: Australia 2017: U.S. 2016: EUR 2018: U.S.

15 | September 26, 2017 | Nestlé Investor Seminar 2017 Plant-based diet

Flexitarians Vegetarians Vegans

Decide to reduce meat protein intake and Do not consume meat, fish or poultry but Consume food and drink only from actively seek plant-based alternatives may eat eggs / dairy plant sources

(+14% globally) (+4% globally) (~2% globally)

16 | September 26, 2017 | Nestlé Investor Seminar 2017 Offering plant-based alternatives across categories at scale

Starting from a solid base Accelerating with new launches Scaling up acquired “ born pure” brands

Milk-free Food

17 | September 26, 2017 | Nestlé Investor Seminar 2017 Offering healthier grain-based snacking across multiple occasions and life stages

Children’s breakfast Grain-based snacking Handheld snacks

18 | September 26, 2017 | Nestlé Investor Seminar 2017 Premiumization: authenticity, simplicity and noble ingredients

Ice cream Culinary Confectionery Coffee

2017: U.S. 2016: Mexico, ASEAN 2017: EMENA 2018: EMENA

19 | September 26, 2017 | Nestlé Investor Seminar 2017 Accelerating Coffee growth through premiumization and new experiences

Premiumization Cold coffee

20 | September 26, 2017 | Nestlé Investor Seminar 2017 Novel personalized experience and delivery models

Chocolatory Direct delivery of personalized menus

2017: 15 boutiques + 66 pop-ups* *pop-ups: 1 to 3 weeks during festive seasons

21 | September 26, 2017 | Nestlé Investor Seminar 2017 Novel personalized services and products

Children / Mother Personalized Petcare Nutrition for Seniors Nespresso “ for Chefs ” Nutritional service Nutrition

70’000 kits sold

22 | September 26, 2017 | Nestlé Investor Seminar 2017 Connecting with a new generation

Millennial-centric platform choices Mobile first creative design Digital media spend above FMCG industry average

40% Nestlé FMCG average

30% 30% When you recycle, your used coffee grounds can become green energy. 25%

20%

10%

0% 2012 2013 2014 2015 2016

Source: Nestlé media agencies 23 | September 26, 2017 | Nestlé Investor Seminar 2017 Empirically measured, externally recognized creative effectiveness

% of aired Nestlé ads in top copy Effie effectiveness index 2017, Food effectiveness quartile*

63% 0 100 200 300 Nestlé 57% Peer 1 Peer 2 42% Peer 3 FMCG norm for aired ads Peer 4 (37%) Peer 5 Peer 6 Peer 7 Peer 8 2014 2015 2016 Peer 9

*Copy effectiveness measured using Millward Brown Short Term Sales Likelihood Source: Effie Effectiveness Index worldwide 2017, Food Category (STSL) Index. Database includes both aired and non-aired ads 24 | September 26, 2017 | Nestlé Investor Seminar 2017 “Non-working” creative excellence working hard for our brands

Felix Nespresso U.S.

327% 256% 15% 21% Nespresso Main branded growth competitor in 112% France 109% 22% 16% 56% Category growth

Felix UK 2013 2014 2015 2016 2017 18% 25% Main branded competitor in UK 59% Exposed to TV ad 40% 44% 36% Not exposed to TV ad 24% 4%

Share of Effective Brand Purchase voice share of voice awareness consideration

Source: Millward Brown – Share of voice vs. Effective share of voice Source: UBS Global Research August 2017; Kantar TNS Brand Tracker

25 | September 26, 2017 | Nestlé Investor Seminar 2017 • Nescafé Gold (EMENA) • Ideal (Brazil) • (EMENA) • Coffeemate (USA) • () • Purina Beyond (Global) • Illuma (China) • Nespresso (USA) • Nespresso «the choices we make» (Global)

26 | September 26, 2017 | Nestlé Investor Seminar 2017 Media effectiveness

Outperforming competition in media buying Enhanced transparency and data integrity 20% cost advantage vs. industry benchmarks Nestlé online video viewability indexed to industry average

1.8 100% 1.6 80% 1.4

1.2

1.0 Industry average viewability 0.8

Benchmark Nestlé cost index cost index 0.6

Q2’15 Q3 Q4 Q1’16 Q2 Q3 Q4 Q1’17 Q2 Q3

Source: Audit of markets representing 80% of global media spend Source: Moat, an independent vendor for measuring viewability, brand safety, fraud and attention of online advertising. Industry average is among Moat clients for Q2 2017. All data desktop + mobile. 27 | September 26, 2017 | Nestlé Investor Seminar 2017 More than CHF 500 million in savings have been reinvested in productive brand building

• Research agency Inefficient • Media vendor spend negotiations negotiations • Competitive reviews • Competitive • Production decoupling agency reviews Productive Inefficient • E-auctions spend spend • Digital agency Productive consolidation spend • Creative agency fee management Working Non-working media media

* Marketing spend cost savings 2015, 2016 and projected 2017

28 | September 26, 2017 | Nestlé Investor Seminar 2017 In summary

• We are integrating consumers’ new NHW expectations across our entire portfolio • Acquired ‘born pure‘ businesses will bring additional sources of growth, as well as inspiration

• Our brands will continue to strive to connect and dialogue with consumers through creative excellence, new digital layers of services and personalization

• We will continue to gain efficiency in all dimensions of our brand building

• It is less about “big food” vs. small brands, than it is about great brands genuinely answering new consumer expectations

29 | September 26, 2017 | Nestlé Investor Seminar 2017 Thank you

30 | September 26, 2017 | Nestlé Investor Seminar 2017