Mark Schneider, the global CEO of Nestle SA, stated that the implementation of AI by the company’s India unit is now being scaled to international markets, enabling the customization of consumer preferences and the development of new product launches.
“We are using AI in India to assess multiple types of data that give insights down to a postal code and demographic level. This level of customisation has benefitted us as well as our customers and consumers,” Schneider said, addressing shareholders at the company’s annual general meeting late Thursday in Lausanne.
According to Nestle SA CEO Mark Schneider, the company has successfully scaled its AI technology and implemented it in several global markets, resulting in tangible gains in each market. He shared that the company is using AI insights to propose a customized basket of products for stores in different neighborhoods. This approach has been successful in India and is now being extended to other global markets. Schneider shared these details in an address, highlighting the success of Nestle’s AI implementation.
Nestle India, whose fiscal year follows the calendar year, reported that it has introduced over 110 new products in the last seven years, with new launches accounting for 5.4% of the company’s total domestic sales.
Schneider expressed that Nestle is aiming to leverage digitalisation to enhance its competitiveness throughout the value chain, including raw material sourcing, product development, manufacturing, operations, sales, pricing, and distribution. Nestle’s 2022 annual report highlights that growth in India is propelled by specific price points and the expansion of distribution to small shops. For instance, Nestle’s Munch chocolate brand in India managed to succeed through affordable “price point management.” As part of its rurban growth strategy, the company grew its direct distribution to 1.5 million outlets last year. Furthermore, Nestle expanded its overall distribution network to 5.1 million outlets in 2022, up from four million outlets previously.
According to the management commentary of the company, it plans to achieve volume growth through penetration and will focus on specific geographic areas by expanding its distribution network and reaching deeper into smaller towns and cities.
Nestle’s revenue for 2022 surged by 14.8% YoY to INR 16,790 crore, buoyed by the strong resurgence of out-of-home demand.
