On September 26, Nestle S.A., the world’s largest food company, held its annual investor summit in London. As reported by FoodNavigator (1) on September 27, Nestle leaders at the summit outlined six important consumer trends that, when translated into new Nestle products and initiatives, will fuel Nestle’s strategy for growth going forward.
The six key food trends driving strategy at Nestle include the following:
1. Natural is King
· As reported by FoodNavigator, Nestle plans to shift all of its food brands to formulas and brand platforms that are more natural in character. The company also plans to focus on natural brands in its M&A strategy. Recent acquisitions such as organic frozen food brand Sweet Earth Foods fit into this strategy.
· Nestle plans to integrate organic ingredients and certified organic SKU’s into many more of its brands.
· Nestle is planning to expand its offerings of gluten-free and lactose-free products.
4. Reduced Sugar
· Nestle is addressing sugar concerns in two ways: a) formulating products with a lower sugar content; b) Introducing a new breakthrough natural sweetness innovation that will deliver a sweet flavor profile with significantly less sugar content.
5. High Protein
· Nestle has increased the number of its new products in several different brands and categories which feature high-protein formulas.
· Nestle sees the consumer interest in plant-based foods and a long-term trend, and the company plans to accelerate its introduction of plant-based options.
Veterans of the natural foods industry will immediately notice a strong parallel between Nestle’s current strategies and the principles that natural industry leaders have embraced and developed. Those principles have long focused on the benefits of natural & organic ingredients, “free-from” products, products with no sugar or lower levels of sugar, and plant-based alternatives to meat and dairy. What we now see is that the long-held principles of the natural products industry are being incorporated in the strategies of the largest international food companies.
Hockey hall-of-famer Wayne Gretzky was asked how it was that he consistently scored so many goals. His oft-quoted answer: “I skate to where the puck is going to be, not where it has been.” The leaders of the natural foods industry, over the years, have successfully used insight and forward thinking to position the industry and its products at the place where consumers are going to be.
Nestle is well-known as a leading food innovator with enormous resources, amazing talent and experience and formidable research capabilities. The company’s embrace of natural foods values serves as a strong validation of the values and the prescience of the natural food industry’s founders and pioneers. Those natural industry founders developed products which were originally very small and somewhat “on the fringe” compared to the mainstream offerings of the broader food industry. These natural foods have now proved to represent exactly what consumers want in their diet for healthful, sustainable living.
All of us owe a huge “Thank You!” to our natural foods industry founders for their vision, dedication and guidance. We also need to thank the current cohort of natural products entrepreneurs for continuing to “burn bright” with new and innovative solutions that meet consumer needs. So too should we thank the folks at Nestle for their commitment to organic products and natural values, as articulated in their forward-looking strategy.
The entire food industry is catching the natural and organic wave, from the smallest start-up at a local tabletop show to the executive offices at Nestle S.A. It’s up to each of us (and all of us working together) to continue to push to create products and consumer solutions that move the food industry ahead on the pathway of sustainability.
1Kate Askew: Six Trends Nestle Hopes Will Deliver ‘Industry-Leading’ Growth; FoodNavigator; September 27, 2017
Clrk Driftmier is the Managing Director of Strobus Consulting