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October 30, 2018

Mondelez launches snacking business hub

Mondelez International is launching a business unit to try to capitalise on changing consumer trends in the global snacking market.

Mondelez International is launching a business unit to try to  capitalise on changing consumer trends in the global snacking market.

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The US-based owner of Cadbury Chocolate and Oreo biscuits will start its SnackFutures programme in November, led by Tim Cofer, the company’s chief growth officer.

SnackFutures will focus on three areas: the “invention of new brands and businesses in key strategic areas”; the “reinvention of small-scale Mondelez brands with large-scale potential”; and “venturing with start-up entrepreneurs to seed new businesses”.

Nasdaq-listed Mondelez hopes the operation will generate an additional US$100m in revenue by 2022, the Illinois-based firm said in a statement today (30 October). The company posted net revenues of around $26bn last year.

Mondelez said it is seeking to engage with entrepreneurs, suppliers, nutritionists, food and technology engineers and other potential partners in “well-being snacks and ingredients, premium snacks and ingredients, and digital platforms and capabilities”.

In September, chief executive Dirk Van de Put outlined a strategy to hone in on the global snacking category, a market he sees as worth $1.2tn annually. As part of his so-called “go-forward strategic” outlook, the CEO said at the time he was seeking to increase the proportion of the US group’s annual sales that come from snacks, which presently stands at 85%.   

The new unit head Cofer said today: “Discovering and unleashing innovative ideas in snacking that will delight consumers and drive growth is a key element of our new strategy. We are launching SnackFutures, a new forward-thinking innovation hub, to capitalise on new trends, and mobilise entrepreneurial talent and technologies to build and grow small brands with large-scale potential.”

The announcement came as Mondelez reported its financial results for the third quarter to the end of September, as well as the first nine months of the year.

Mondelez’s net revenues rose 1.2% to US$19.17bn during the first nine months of 2018. The company’s operating income was down 7.2% at $2.44bn as it lapped a period when it booked a gain on the disposal of assets in Australasia. Net earnings stood at $2.56bn, up from $2.13bn a year earlier.

Third-quarter net revenues fell 3.7% to $6.29bn amid a near-15% slump in sales in Latin America and declines across its three other geographical divisions – Europe, North America and the combined Asia, Middle East and Africa.

Third-quarter operating income was down 37.1% at $737m. Net earnings reached $1.19bn, versus $981m a year earlier.

Sanford Bernstein analyst Alexia Howard pointed to Mondelez’s third-quarter gross margin of 40.6%, which she said “showed promise”.

Howard said: “Overall we find the gross margin trends encouraging: While other U.S.-centric food companies are struggling with input cost pressures, Mondelez seems to be bucking the trend. We wonder whether this could be the beginning of a sustained period of easing cocoa input costs, since the company mentioned that hedges rolling off were helping out last quarter as well. This would also have a positive read-through for Hershey as we head into 2019.

“Now if they could just get the top line cranking as well, with more granular incentives, more normal weather in Europe, less impact from the cyber attack, greater leverage of the US DSD system and continued progress in emerging markets like India and China.

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Unilever- A Deep-dive into Product Launches and Advertising Strategy

Unilever product advertising is mainly through mainstream TV channels. Out of the products advertised so far at least 50% (over 850) of ads have been run on TV, while print media comes second with 496 ads. Unilever also utilizes social media platforms for advertisement. Unilever products are categorized by innovation ratings and tags in our product launch database. The North American region consists of almost 74 products with innovations related to the formulation of the product. Europe and other regions also have more products categorized under formulation-related innovation, followed by the packaging and positioning of the products. Most Unilever products are tagged with “High Vitamins”, “Recyclable”, and “Natural” tags to understand what the product differentiator is from other products available in the market. The majority of products belong to the personal care industry with a total of 5,788 products to date. This report, through the Unilever Example, illustrates how GlobalData Explorer enables you to:  
  • Track product launches by FMCG companies to get an understanding of the product-level strategies including geographic concentrations, innovation types, product claim, category focus and more
  • Monitoring the advertising strategies of various brands and gain insights into channel focus, regional focus, and more
  • Perform company-level analysis to understand business model, size, and geographic focus
Don’t miss out on key market insights that can help optimize your next investment – read the report now.
by GlobalData
Enter your details here to receive your free Report.

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