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NestléInvestor Seminar Health, Nutrition and Wellness at Nestlé ChristianeKuehne Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman 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 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Our vision "We want to grow from the respected and trustworthy food company that we are known as now, into a respected and trustworthy food, nutrition and wellness company"* *Peter Brabeck-Letmathe Blue Printfor the Future, October2001 3 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Building on our heritage 1867: Henri Nestlé creates"Farine Lactée" for infants, elderlyand infirms 4 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Nestlé's approach to Nutrition, Health & Wellness Drive the Nutrition, Health & Strengthen our leadership Wellness orientation across position in the core nutrition the Company business CorporateWellnessUnit NestléNutrition Company 5 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Whatthe CorporateWellnessUnit does. • The mission: Drive the Nutrition, Health& Wellnessorientation acrossNestléto deliversustainableprofitable growth. • The strategy: Persuade consumersto preferourbrands by addinga superiorNutrition, Health& Wellnessdimension to our Food & Beveragebusiness • Wellness in Action is about: Accelerating the speed at which our vision and strategy transform into trust & value in the minds and hearts of consumers • Outcome: A higherpropotionof Group sales in added-value, fastergrowing, more profitable segments 6 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Roadmap 7 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Consumer 8 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Most consumers see a strong link between food and their health Overall USA UK Sweden Spain Holland Italy Germany France 0 10 20 30 40 50 60 70 80 90 100 DatamonitorConsumer Survey, October 2004 IMPORTANT VERY IMPORTANT 9 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Nutrition increasingly influencing consumer choice Relative importance of motivation for main meal choice in US/Europe Complements other food Indulgence Energy Boredom, stress Taste % Quick, easy Hunger Using up ingredients Healthy, nutritious 0 10 20 30 40 50 60 70 80 90 100 DatamonitorConsumer and Industry Opinion Surveys, 2004 10 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman 60/40+ 11 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman 60/40+ 60/40+ our strategic transformation tool To increase the To communicate the nutritional value of our taste and nutritional products but not at the advantage of our expense of taste products 12 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Whichmeans… Weneedto know the product"truth" –the consumer preference –the nutritionalvalue of ourproduct –ournutritionalcompetitiveadvantage 60/40+ is the X-ray of our products 13 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman It isalsoa powerfulBusiness tool Consumer Communication Innovation / Renovation 60/40 Taste Nutritional Assessment Assessment Nutrition Profiles Consumer Insights DrivingGrowth, MarketShareand EBITA 14 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman 25% of our Food & Beverage business ... ... goes through 60/40+ testing per year 15 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Dairy China NestléHigh Calcium High Iron 16 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Dairy China NestléHigh Calcium High Iron "I want to keep my body feeling young, Insight and for this I need strong bones!" 60/40 Consumer 66/34 taste preference Preference Nutritional Good Nutritional Nutritional Competitive Advantage: Calci-N for Assessment Foundation bone health Communication "With strong bones, you can face any challenge" TV Commercial Improvedprofitability+410 bps, Business turnaroundfromdecline Results to +4% MS in 10 months 17 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Ice Cream Canada Real Dairy 18 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Ice Cream Canada Real Dairy "I want to be able to indulge myself and my family, while still feeling Insight like a good Mum" 60/40 Consumer 68/32 taste preference Preference Nutritional Good Nutritional Foundation Assessment Ownership of consumer nutritional expectation through the Brand: Communication Real Dairy NestléReal Dairytookleadership fromBreyerswithin2 yearsand Results playeda key role in the "Good For You" business 19 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Ice Cream Canada Real Dairy Becoming Number One! Breyers 30 Reformulation 25 20 15 10 Launch Nestlé Real Dairy 5 0 3 3 4 5 5 3 3 3 0 4 4 4 0 4 4 4 5 5 5 5 0 6 6 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 0 0 0 2 0 0 0 0 0 0 0 0 2 0 0 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 9 4 9 4 9 4 0 5 0 4 0 5 9 6 1 6 1 6 1 8 1 1 0 0 2 2 2 1 1 0 3 2 1 1 1 0 0 2 2 1 r t v r y t t c r t v r p e g c o n a y l p c e b p e g c o n a n u O Ja a u e O e n u O Ja A Ju A N M M J S D F A Ju A N M BNF NRD ACNielsen Marketrack, period ending March 18,2006, $Share of Premium I/C 20 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Ice Cream Canada Real Dairy Real Dairy Vanilla is the flagship for a "Good For You" range With Omega 3 No sugar added 97% fat free 98% fat free Made with real fruit 21 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Maggi France Sveltesse 22 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Maggi France Sveltesse " I know I shouldeat5 fruits and vegetablesa day, Insight but it'snot easy... " 60/40 Consumer Parityvs. regularsoup(withfat) Preference Nutritional Good Nutritional Nutritional Competitive Advantage: fibers Assessment Foundation Great Quick and easyvegetableson the go. Communication TV Commercial Results RIG +15%, MS + 0.8% 23 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Maggi France Sveltesse PrintAd 24 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Products 25 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Nestlépolicies • NestléPolicy on the Level of trans Fatty Acids in Foods • NestléPolicy on the level of Sodium (Salt) in Foods • NestléPolicy on the level of Sugar in Foods • NestléPolicy on the Iron Fortification of Foods • NestléPolicy on Nutrient Fortification 26 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Health & Nutrition strategy in action Consumer Insights R+D Framework Renovation Nutrition targets +Policies Innovation Ì +60/40+ profile +Communicatio n Nutrition Insights Obesity • Reduce sugar by concern New Milo 15% Reduce sugar to • New malt extraction meet Nutrition • Increase complex Ì criteria carbohydrate • Same taste Sugar • Same costs Concern 27 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Health & Nutrition strategy in action Children’s Health & Nutrition Solutions NIDO Nurturing AGE SPECIFIC "Right Taste, Right Price, ALL AGES Right Nutrition" Full Cream Affordability "All in One Growth" 28 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Optimisingnutritional profiles REDUCING SUGAR INCREASING CALCIUM REDUCING FAT INCREASING FIBER REDUCING SALT 29 29 NesttlléInvestor Seminar -VeveeyyJune 8-9, 2006 Name of chairman Optimising nutritional profiles 30 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Optimising nutritional profiles - Reducing 22% reductionin 5 years.Todaycovers43 differentrecipes Level of sodium in soups per 100 ml Level of sodium in soups per 100 ml 2000 2005 700 700 600 600 500 500 g g m 400 400 m m m u u 300 i 300 i d d o o S S 200 200 100 100 0 0 0 2 4 6 0 2 4 6 8 0 2 2 1 3 5 7 8 0 2 4 6 8 9 1 3 5 7 9 1 3 1 3 4 5 6 7 8 9 9 1 3 5 7 1 1 1 1 3 3 3 3 3 4 4 1 1 1 1 1 2 2 2 2 2 2 3 3 3 3 3 4 4 123456789101112131415161718192021222324252627282930 1 2 2 2 2 31 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Optimising nutritional profiles - Increasing 32 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Adding Health Benefits Vitality / Protection Immunity & Protection Heart Health Long-Lasting Energy BrandedActive Benefitsaccountedfor sales R Intestinal Health Groofwth &CHFBu 2ildi.n9g StBrongioer in Easy2005 Helps Energy Development Bones Digestion Release Active Cholesterol Long Lasting Feeling Good, "Refuelling" Helps Keep Calcium Control Alertness & It Shows Growth in your Bones 33 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Branded Active Benefits (BAB) BABsare registered trademarks related to specific health benefits whose purpose is to add value to existing Nestléproducts: Making a good Nestlébrand even better They are always science-based 34 Nestlé Investor Seminar - Vevey June 8-9, 2006 Name of chairman Success Story: Powdered Beverages Philippines Innovations to reinforce Milo as " King of Energy"