Nestl Banks on Alibaba to Boost Disappointing Business in China
by swisscham in Hospitality, Retail, Tourism
Nestl SA and Alibaba Group Holding Ltd have launched a digital commerce and marketing campaign, a move the Swiss food giant hopes will boost its disappointing business in China through innovation in products and digital distribution channels. The six-month joint campaign will leverage Alibaba’s online and mobile marketplaces, media platform and rural services. According to Nestl, it will feature 154 products from 30 brands, 67 of which will be introduced to Chinese consumers for the first time. Nestl’s growth had been slowing in the past few years in China, as the company said it has not reacted quickly enough to trends like e-commerce and healthier eating. Nestl said its Chinese Yinlu congee brand still faces challenges as consumers shift to more premium products. “Consumers in China are very discerning and adapting to technology faster than almost anywhere else in the world,” said Wan Ling Martello, executive vice-president responsible for Nestl’s Asia, Oceania and sub-Saharan Africa regions who is also on Alibaba’s board. Martello said at an investment meeting in May that despite the slowdown in Chinese economy and the country’s fast-moving consumer goods sector, the country remains a great consumer story thanks to its emerging middle class and their growing disposable income.