2009 Processor of the Year: Nestle USA

A $101 billion global company works hard at understanding shoppers with a $60 weekly food budget.

By Dave Fusaro, Editor in Chief

3 of 3 1 | 2 | 3 > View on one page

Researchers do not know the cause. But in tandem was a heightened awareness of how many agricultural crops worldwide are pollinated by bees. "One-third of all the foods we eat are pollinated by honeybees," says Diane McIntyre, senior pubic relations manager for Häagen-Dazs. "But over the past three years, more than one in three honeybee colonies has died nationwide, posing a serious risk to our natural food supply."

So, Nestlé's Häagen-Dazs brand took up the cause. "We had never adopted a cause before, but this one seemed so right," McIntyre says. "With 50 percent of the Häagen-Dazs brand's all-natural ice cream flavors dependent on ingredients pollinated by honeybees, the solution to their disappearance was critical for the brand."

In 2008, the Häagen-Dazs brand began funding sustainable pollination and CCD research at University of California at Davis and at Pennsylvania State University. The company also resurrected an old Häagen-Dazs flavor—dating all the way back to founder Reuben Mattus' days—called honey vanilla, now renamed Vanilla Honey Bee.

The brand pledged $250,000 again this year, bringing its total donation for honeybee research to a half a million dollars over two years. Neither the cure nor the cause of CCD has been discovered, but current thinking focuses on mites, poor nutrition, insect diseases and neonicotinoids in pesticides. Research continues.

One advantage of being part of a large and global company is the opportunity for employees to work in other countries. "I had the opportunity to work in Australia two different times and the international experience made me a much better person and a much better executive," Alford continues. "No matter what country you work in, there is always a diverse mix of employees from around the world. It's a necessity if you want to make it to the most senior ranks of leadership at Nestlé.

"A great example is our worldwide CEO Paul Bulcke. Paul joined Nestlé over 30 years ago in his native Belgium as a financial analyst. He moved over to marketing and worked in Switzerland, Spain, Ecuador and Chile. Then he held market head jobs in Portugal, Czech Republic, and Germany. He was heading up the entire North and South America Zone when he was named worldwide CEO early last year."

Despite all its advantages, size does have its shortcomings. As the world's largest food company, Nestlé SA tends a balancing act between fostering independent and localized thinking and enforcing corporate goals, between requiring financial discipline and sharing its considerable financial resources.

It's precisely that kind of stewardship that enables the budgeting of $500 million to build the world's largest and most sophisticated milk-based beverage plant (in Anderson, Ind.), which will create shelf-stable milk products that can be shipped at ambient temperatures and with a six-month best buy date.

…And yet promotes Libby's canned pumpkin every fall.
That comes up with the formulation and process changes that invented the concept of slow-churned ice cream, which lowered calories and fat but maintained the taste of full-fat ice cream.

… And still makes Pixy Stix and Lik-M-Aid.
That can dictate to its plants the conversion to harmless non-fluorocarbon refrigerants – including much original development work on carbon dioxide and ammonia hybrid systems – to prevent ozone depletion.

…And still makes condensed milk.
But all the size, global reach and financial discipline is secondary to the food and the consumers who buy it.

"Ultimately, all of us at Nestlé are passionate about food," says Alford. "I always say that we have to understand our consumers better than anyone else to remain successful. We use a variety of means to dig as deep as possible so we can truly identify with our consumers' wants and needs.

"One of our most recent initiatives has to do with identifying how consumers behave in-store – where they are known as shoppers. Marketing to a consumer is different than marketing to a shopper, because what a consumers says they will buy and what they actually buy are not necessarily the same thing. We know from research that up to 70 percent of purchase decisions are made in-store – so we are working with our retail partners to give shoppers what they want in each retail outlet, whether it's meal solutions, recipes or different types of information about our products.

"At our most recent marketing summit, we focused on shopper marketing and took part in a valuable exercise that allowed us to walk in our shoppers' shoes. We all went to different food stores with a shopping list and a fixed budget of $60 for a week's worth of groceries. That's the challenge most of our consumers face every week and it was a great learning experience. My goal is to get the shopper marketing mindset to become more integrated into our planning process and our overall business approach."

3 of 3 1 | 2 | 3 > View on one page
Show Comments
Hide Comments

Join the discussion

We welcome your thoughtful comments.
All comments will display your user name.

Want to participate in the discussion?

Register for free

Log in for complete access.


No one has commented on this page yet.

RSS feed for comments on this page | RSS feed for all comments