According to Nestlé’s latest financial statement, its organic growth reached 8.1%, supported by dynamic retail sales, a return to growth in out-of-home communication channels, higher prices and market share gains. . By channel, organic growth in retail sales was 7.3%.
At the same time, eCommerce sales grew by 19.2%, reaching 14.6% of total Group sales, with strong momentum in most categories including coffee, Purina PetCare and culinary.
Organic growth in out-of-home channels was 21.3%, helped by the relaxation of movement restrictions in certain geographies.
Mark Schneider, CEO of Nestlé, said organic growth was strong in most geographies and categories, with strong retail sales momentum and a return to growth in out-of-home communication channels. “Through rapid innovation, strong brand support, increased digitization and rigorous portfolio management, we have laid the groundwork for consistent single-digit organic growth for years to come,” a- he declared.
“The extension of our partnership with Starbucks to ready-to-drink coffee will open up new opportunities in a fast-growing segment. Our portfolio choices, our solid execution and our decisive actions in terms of sustainable development allow us to create value for all stakeholders, â€he added.
Total reported sales rose 1.5% to $ 46 billion and the growth was widespread across most geographies, the company said. However, the biggest contributor to organic growth was coffee, fueled by strong demand for the three main brands Nescafé, Nespresso and Starbucks. Starbucks products grew 16.7%, with sales reaching US $ 1.545 billion in 79 markets. On July 26, 2021, Nestlé and Starbucks strengthened their collaboration to bring ready-to-drink coffee-based beverages to select markets in Southeast Asia, Oceania and Latin America.
Meanwhile, Purina PetCare experienced double-digit growth driven by science and premium brands Purina Pro Plan, Purina ONE and Felix, as well as veterinary products. Nestlé Health Science sales grew at double-digit rates, reflecting strong demand for vitamins, minerals and healthy aging supplements and products.
Ready meals and cooking aids show high single-digit growth, based on strong demand for Maggi and Stouffer’s. Vegetarian and plant-based food offerings continued to post strong double-digit growth, led by Garden Gourmet. Dairy products experienced high single-digit growth, led by fortified milk, coffee creamers and ice cream. Confectionery recorded double-digit growth, supported by strong growth in sales of impulse products. Water returned to positive growth, driven by the international premium brands S. Pellegrino and Perrier.
However, infant nutrition has seen a decline in sales, impacted by falling birth rates amid the pandemic.
The Asia, Oceania and Sub-Saharan Africa zone recorded organic growth of 6.8%. Most categories gained market share, especially pet food, coffee, confectionery and culinary products.
China posted double-digit growth, helped by a recovery in out-of-home channels and the Chinese New Year calendar. The biggest contributor to growth was Nestlé Professional, with sales surpassing 2019 levels. Coffee, culinary, dairy and Purina PetCare all saw strong double-digit growth, but infant nutrition recorded strong double-digit growth. a drop in sales, with market shares declining but slowly stabilizing.
Southeast Asia experienced slightly negative growth in a difficult economic environment.
Strong single-digit growth in Malaysia and Vietnam was offset by lower sales in the Philippines due to a high comparison basis in 2020. Confectionery and ice cream sales grew at a double-digit pace, with particularly strong momentum in Malaysia. Dairy products experienced mid single-digit growth, driven by strong demand for fortified milk.
South Asia recorded double-digit growth, with continued strong momentum in e-commerce. Growth was widespread across most categories, led by Maggi, KitKat and Nescafé. Baby Nutrition shows negative growth and continues to gain market share in South Asia and Africa.
Separately, the company is in the middle of a press review for Singapore and Malaysia and will invite several agencies to submit their credentials. The winning agency will be announced in the third quarter of this year. The review will involve a re-examination of how to manage media strategy, planning and purchasing in light of the rapidly evolving digital platforms and the changing landscape and media agencies.
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