Advertise with fastmoving.co.za
 
 

Nestle’s coffee push brews better sales
Nestle’s coffee push brews better sales

Nestle’s coffee push brews better sales

MARKETING NEWS

IOL Business/ - Jul 20th 2016, 09:57

Zurich - Nestle SA, the world’s biggest food company, reported first-quarter sales that beat analysts’ estimates, as Nescafe and Nespresso were boosted by marketing to ward off increased competition in coffee. 

Sales rose 3.9 percent on an organic basis, the Vevey, Switzerland-based maker of KitKat bars and Perrier water said in a statement Thursday. Analysts had expected 3.6 percent, according to the median estimate in a Bloomberg survey. Revenue from powdered and liquid beverages - predominantly the coffee business - rose 6.3 percent.

Nestle misses sales target for third year

Nestle’s world-leading coffee business faces a fresh challenge from JAB, which has spent more than $30 billion acquiring assets like Keurig Green Mountain, the maker of the most popular single-serve coffee system in the US. Europe’s biggest company by market value gets about a quarter of its sales from the unit that includes coffee. The good performance in coffee was boosted by advertising, according to Jon Cox, an analyst at Kepler Cheuvreux in Zurich.

“Nestle invested money into marketing in the fourth quarter, which actually dampened group margin in 2015, but is now paying off,” said Jon Cox, an analyst at Kepler Cheuvreux in Zurich. “It’s taking advantage of the uncertain situation among competitors in coffee amid JAB’s rapid acquisitions of multiple businesses.”

Volume-driven

The first-quarter growth rate is the slowest since 2009. Shipments rose 3 percent, Nestle said. Pricing boosted sales by 0.9 percentage point.

Maggi regained market share in India after last year’s product recall though the comparison with the year-earlier period was difficult, Nestle said.

The maker of Gerber baby food confirmed its forecasts for 2016. Nestle said in February it expects organic revenue growth to be similar to last year’s 4.2 percent and below its long-term target because it’s hard to raise prices. Nestle also said at the time it aims to achieve improvements in margins and underlying earnings per share in constant currencies.© Independent On-line 2013 

Read more about: south africa | sales | nestle | marketing

Related News

Retail sales remain muted with consumers under pressure
20/09/2019 - 14:31
Retail sales for July marginally declined to 2 percent year on year as sales growth continued to reflect a muted demand in South Africa, with consumers’ discretionary income under strain.

Digital marketing: multi-touch attribution
19/09/2019 - 13:43
The effective tracking of digital marketing campaigns is not as easy as initially thought. One question that often pops up is: at what point did consumer conversion take place? During a campaign, it’s difficult to attribute this correctly, especially with multiple touchpoints such as display and native advertising, sponsored social posts, video ads on mobile or paid-for search results all running consecutively.

Ackermans launches ‘Moms4Moms’ educational platform to give mothers a helping hand
16/09/2019 - 14:03
According to a 2017 Statistic South Africa report, 61% of South African children are raised by only their mothers. This reveals that the majority of South African women have to navigate single-parenthood, as well as being the sole provider for their families.

Rhodes Food Group's turnover rises amid healthy international growth
16/09/2019 - 11:14
The international turnover of Rhodes Food Group, which makes Bull Brand corned meat and Bisto gravies, rose 13.4% in the 10 months to end-July, boosted by a weaker rand and exports of fruit snacks to the US.

Lego's sales bounce back with the help of Marvel superheroes
04/09/2019 - 09:11
Models of superheroes and villains from Marvel’s Avengers movies helped lift first-half sales at Lego, as the Danish toymaker continued its turnaround drive with investments in China, India, the internet and new stores.