Professional Documents
Culture Documents
August 2019
Table of Contents
• Executive Summary Slide 3
• Company Insight Slide 4
‒ Company Overview
• Strategy & Strategic Plan Slide 7
‒ Business Strategy/Priorities Slide 7
‒ Business Challenges Slide 23
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Mondelez
Executive Summary
OVERVIEW BUSINESS STRATEGY BUSINESS CHALLENGES MARKETING PRIORITIES
• Mondelez International • Mondelez is accelerating • Mondelez is facing challenge • Mondelez is transforming its
manufactures and sells consumer centric growth to in North America as the marketing and digital
snacks, including biscuits, gain insights about snacking company is still recovering capabilities to increase ROI
chocolates, gums & candies behaviors and occasion from past cyber attack
as well as various cheese & • Mondelez developed a more
grocery and powdered • The company is driving • The company is struggling to locally-oriented commercial
products operational excellence achieve omni-channel structure to drive greater
through sales execution, excellence, deliver consumer focus, improve
• The company’s portfolio marketing and supply chain consumer-centric digital speed and reduce complexity
includes iconic snack brands marketing and improve its
• To accelerate growth, the • Mondelez is working to put
such as Cadbury, Toblerone overall digital capabilities
and Oreo company is shifting towards purpose at the center of
a more agile, digital and local • Another disruptive force that Mondelez’s brand
• Mondelez plans to transition first approach challenges Mondelez’s communication
from being a cost focused business is its local consumer
company to a more growth–
oriented company
• Modelez International is building itself as the best snacking company in the world by focusing on three strategic priorities
‒ Mondelez is accelerating consumer centric growth by taking a broader approach to snacking, balancing its investment across global and
local brands, transforming its marketing and investing in key markets and adjacencies
‒ The company is driving operational excellence in sales execution, marketing, supply chain and generating continuous cost and quality
improvement across the business
‒ Mondelez is building a winning growth culture that more effectively leverages local commercial expertise, investing in talent and key
capabilities to move with greater speed and agility
Mondelez
Business Strategy
• The company has laid out following criteria for its merger and acquisition:
‒ Build Scale: Build higher scale in priority markets
‒ New segments & categories: Access higher growth snacking adjacencies
‒ New capabilities: Add new business capabilities in core categories
‒ Portfolio optimization: Continue to shape snacking focused portfolio
• In June 2019, Mondelez announced to acquire a majority interest in Perfect Snacks, a key player in the refrigerated nutrition bars segment. The
acquisition helps Mondelez further expand its position in broader snacking space
• In April 2019, Mondelez announced a collaboration agreement with The Kitchen, Israel’s only FoodTech-focused incubator and one of the first
FoodTech incubators in the world. Through the collaboration, Mondelez will have access and visibility to world’s leading FoodTech ecosystem
• In March 2019, Mondelez collaborated with The Hatchery Chicago, a non-profit food business incubator. Through the partnership, the
company will be able to connect with the local food and beverage start-up community and work together to accelerate and scale innovation
• In June 2018, Mondelez acquired Tate’s Bake Shop for approximately $500 million. The acquisition helped Mondelez to expand portfolio of
brand that consumers love and provide entry into the fast growing premium cookie segment
brand, with its new strategy, Mondelez is achieving a better ‒ Chocobakery is an extension of its chocolate brands into
biscuits and cakes. With this premium offering, it helped the
balance between investment in global brands like Oreo, Milka company to gain biscuit market share in India
and belVita and local jewels like Fontaneda in Spain or LU in • In 2019, Mondelez launched Cadbury Little Treasures in the UK,
France; Freia, Marabou in the Nordics; Kinh Do in Vietnam which is a portion controlled amount of chocolate, combined with
a series of collectible toys
‒ The combination of global and local brands is generating
‒ The launch helped the company increase overall Cadbury Daily
stronger growth than with focus on global brands alone for the Milk sales in the UK
company. All combined, the brands drove overall net revenue • Mondelez has plans of building a global savory snacking platform
through its Ritz crackers brand
growth of 2.5% in its fourth quarter of 2018
• The company is also expanding its Oreo brand across multiple
‒ Mondelez local and global brands are benefiting from its areas within snacking
increased investment in advertising, creativity and innovation
• With the company’s improved supply chain and direct-to-store distribution model, according to Mondelez in Q1 2019, it helped to gain single
digit consumption growth and its feature and display conversion grew double digit, particularly behind its launch of Game of Thrones themed
to Oreo pack
• Mondelez has launched initiatives to drive e-commerce excellence with key partners in China, where online sales as well as and overall growth
is been increasing
• In India, the company made significant enhancement to its sales and route to market excellence, where the company has been increasing and
been investing heavily for growth
• Mondelez plans to continue to improve efficiency by leveraging its global shared service platform, driving greater efficiencies in its supply
chain and continuing to utilize Zero-Based Budgeting (ZBB) across its operation
• In April 2018, Mondelez invested $90 million in the state-of-the-art biscuit manufacturing plant in the Kingdom of Bahrain. This serves as a
hub for exports to Gulf region, the Levant and Africa, reducing delivery cost and improving freshness which will be instrumental to the success
of its growth plan
• In June 2018, Mondelez announced it has invested $200 million since 2014 in its Opava biscuit manufacturing facility. The investment
supports the company’s growth strategy to create a best-in-class integrated supply chain and to deliver consumer inspired quality and
innovation that meet changing consumer preference
• Mondelez is leveraging its customer supply and logistics capabilities to deliver better in-store presence and availability
• The company’s continuous improvement through Omni-channel Excellence, ISC Flexibility & Optimization, Consumer & Brand-Centric Digital
Marketing and Consumer- Centric Insight & Foresight drives more sophisticated consumer communications and optimization of supply chain
operations
‒ The company’s local focus includes empowerment of sales and marketing teams on the ground in specific markets. In the first quarter of
2019, Mondelez implemented a new more locally oriented commercial structure with 13 business units within its existing regional
framework to achieve a local focused winning culture
o Mondelez is giving its local teams more autonomy to drive commercial and innovation plans as they are closer to the needs as desire of
consumers
o In March 2018, Mondelez called out team of five people to oversee its marketing across the globe as part of new regionalized structure.
The goal is to put marketing executives closer to the countries they oversee, so that the company can quickly respond to shifts in
consumer demand
‒ In 2018, Mondelez spent its marketing spend by more than $150 millions as it pushed further into Russia, China and India – emerging
markets which represent 80% of the growth potential in snacking around the world
o The company has prioritized its local brands over its global brands out of its $1.5 billion+ ad spend
‒ Shift to local first approach reduces the company’s complexity, improve its speed and encourages more entrepreneurial approaches to
marketing, sales and product development
‒ Mondelez is encouraging its colleagues to test, learn and scale, which reflects that the company is implementing a faster, more cost-effective
and locally driven approach to innovation
‒ The company’s digital transformation program helps to enable consumer demand and sales opportunities. Mondelez believes these shifts
will help drive profitable top-line growth
o In June 2018, Mondelez International signed a new multi-year agreement with Genpact, a global professional service firm focused on
digital transformation
o The expanded engagement allows the two companies to continue to co-innovate and drive faster, smarter insights from finance data.
Genpact supports Mondelez International’s global finance operations in 75 countries, delivering simplified and standardized operations
across more than 150 finance and accounting processes
• During 2012-2017 period, gains in Mondelez have been half as compared to those of the S&P 500 companies. The company has struggled to
grow sales in recent years as customers taste is changing
‒ Every viable small town now has a sushi bar, Korean Barbecue and artisanal doughnut shop. Even middle-American diners crave food with
hot spices, vinegar and fresh cilantro with hot-sweet-sour-salt over the palate
‒ The factory-made American combination of wheat flour, sugar and salt seems pale. The priority for items like Oreo Cookies and Ritz Crackers
are not high as it used to be
• Another disruptive force that challenges Mondelez’s business is its local consumer
‒ The differences between consumer behaviors and what they want is increasing. It’s largely driven by online and availability of product at
anytime, anywhere
‒ The company is looking forward to change its innovation, marketing, the way it does branding and overall how it moves and operates as a
company
• Mondelez distributes its products through store delivery, company-owned and satellite warehouse, distribution centers and other facilities. The
company uses the service of independent sales officers and agents in some of its international locations
• Through its global e-commerce organization and capabilities, Mondelez pursues online growth with partners in key markets around the world,
including both pure e-tailers and brick-and-mortar retailers. The company continues to invest in both talent and digital capabilities
‒ Consumer marketing and advertising including on-air, print, outdoor, digital and social media and other product promotions
‒ Trade promotions to support price features, displays and other merchandising of its products by its customers
‒ Increasing the use of technology such as social listening and advanced analytics to better understand the consumers’ need
‒ Focus on marketing transformation. Mondelez is working to put ‘purpose’ at the center of brands’ communication
Mondelez
Marketing Priorities
Increase
Local First Approach Focus on Purpose
Digital Capabilities
‒ Mondelez is investing in digital capabilities to allow consumers to personalize products and packaging online. In March 2019, Mondelez
launched Oreo Rainbow exclusively on Alibaba’s Tmall online marketplace. The platform allows users to curate an assortment of Oreo
cookie flavors
• In 2017, Mondelez initiated a pilot project ‘Sherlock’, that helped the company understand which items are sold through online channels, who
bought them and how much it cost to get items from the factory floor to a customer’s doorstep
‒ The goal was to gain better understanding of what drives revenue growth and to figure out the most efficient way to deliver products
“With this new methodology, we are able to segment snacking needs based on all possible drivers like state of hunger, time of
the day, location, emotional need, demographics and so on. All this allows us to sharpen our brand positioning, improve our
communication, ensure our portfolio remains incremental and avoid overlap, and it also identifies innovation and renovation
opportunities. All of this is leading to a better consumer connection with increased sales and higher returns on our marketing
and innovation investments”
-Dirk Van de Put, CEO (September 2018)
• Mondelez is taking a more local approach to its global marketing. The company will now take five people to do the job once performed by
formal global CMO
‒ In March 2018, the company created four new Regional Chief Marketing Officers where Debora Koyama oversees European marketing;
Jason Levine for North America (left Mondelez in March 2019); Maria Mujica for Latin America and Mie-leng Wong leads marketing in Asia,
Middle East and Africa
‒ The regional marketing officer for Europe, Debora Koyama, focuses on elevating marketing from a capabilities standpoint and unlock the
talent and power from portfolio of brand the company has- globally and specifically in Europe
‒ Chief Marketing Officer for North America commonly would focus on building iconic brand and push Mondelez towards more consumer-
centric approach to building its brands (James Levine left Mondelez in March 2019)
‒ The goal of adding chief marketing officer roles is to put marketing executives closer to the countries they oversee, so that the company can
quickly respond to shifts in consumer demand. It marks a significant strategic shift for the company, which had relied on a more centralized
global approach
‒ The company’s new global CMO Martin Renaud will oversee broader functions like brand strategy, agency relationships, marketing capability
as well as media and digital
‒ At Mondelez, the regional CMOs will report directly to regional presidents, but still have a dotted line report into the global CMO
‒ The company has prioritized its local brands over its global brands out of its $1.5 billion+ ad spend
‒ Mondelez has around 65 “local jewels” that generated 47% of total revenue for the company in 2018. In 2019, the company is investing in
local jewels like Fontaneda in Spain or LU in France, Freia, Marabou in the Nordics, Kinh Do in Vietnam
‒ The company’s local focus also will include the empowerment of sales and marketing teams on the ground in specific markets. In 2018, 15
markets around the world accounted for 79% of Mondelez’s revenue
‒ Mondelez has opportunity to use local strength in one category to boost its growth in the other. The company will also empower its local
teams to move faster, launch more relevant local innovations and hold them accountable for accelerated growth
“Investing in a new regional CMO model will not only bring deep expertise to our marketing practice, but also increase
connection and collaboration between our Global CMO, our P&L leaders and the global team. This new structure will change
the trajectory of our Marketing function, empowering our fearless commercial talent to drive growth and allowing us to move
at the speed of our consumer”
– Tim Cofer, Chief Growth Officer (March 2018)
• With ‘purpose’ at its center, the company is leveraging the potential of its power brands that have previously seen sluggish sales trend
‒ In May 2019 , according to European Chief Marketing Officer, Debora Koyoma, Mondelez has “iconic, powerful, emotional brands” with high
awareness and household penetration, as Cadbury has 88% household penetration in the UK, while Milka has 53% household penetration
in Germany
‒ Cadbury’s recent performance as a “lighthouse” brand showed other parts of the business how purpose can be leveraged to increase sales
‒ The brand went from declining sales to mid-single digit growth by leveraging the entrepreneurial story of how it was founded by Quaker
John Cadbury
• In September 2018, Mondelez unveiled its new tagline and purpose, “snacking made right” in which they offer consumers “the right snack, for
the right moment, made the right way”
‒ It aims to “empower people to snack right” from both a sustainability and social standpoint as well as helping people make healthier choices
and being more aware of the quality and production of products
“We have power as businesses to really do something. People are choosing brands based on what companies stand for. That is a
huge opportunity and responsibility. Purpose is not just something nice to do, it really drives business. It drives purchase intent”
– Debora Koyama, Chief Marketing Officer, Europe (May 2019)
• As part of company’s commitment to reinvent Marketing, Mondelez International is making incremental investments, setting the stage for the
function to lead its growth agenda in the short and long term
• According to Mondelez’s annual filings, the accrued expenses for marketing and advertising in 2018 was $1,756 million where as for 2017 the
company spent $1,728 million
• Consultancy R3, which counts Mondelez as a client, estimates that the company’s annual global paid media spend to be approximately in the
range of $800 million to $1 billion, though past estimates have been as high as $1.5 billion
• According to the Ad Age Datacenter, Mondelez is the world’s 91st largest advertiser. Its total ad spending fell 10.6% to reach $1.25 billion, or
4.8% of sales, in 2017
Year Advertising Expenses % Change
• Similarly, Mondelez global advertising expenses were:
2018 $1,173 million -6%
2017 $1,248 million -10.6%
2016 $1,396 million -9.46%
§ Tony delivers direct store delivery § Cameron leads the global sales
revenue for Mondelez P&L target of capabilities team resulting in a lower
$150 million for the Southern cost, higher impact unified approach for
California market through chain sales learning and development. She
grocery, mass merchandiser and managed a budget of $5.4 million to
military deliver Global Sales Learning Priorities
“With strong leadership in our categories, an unparalleled portfolio of global and local brands and a solid footprint in fast-growing markets, we are
uniquely positioned to lead the future of snacking. We have developed a clear strategic plan to accelerate our growth and drive attractive total returns
centered around three strategic priorities: accelerate consumer-centric growth, drive operational excellence and build a winning growth culture”
“Investing in a new regional CMO model will not “People are choosing brands based on what companies stand for. That is a huge opportunity
only bring deep expertise to our marketing practice, and responsibility. Purpose is not just something nice to do, it really drives business. It drives
but also increase connection and collaboration purchase intent. It can be a path to growth with the powerful brands we have to unlock
between our Global CMO, our P&L leaders and the growth through purpose”
global team. This new structure will change the - Debora Koyama, European Chief Marketing Officer, Mondelez International (May 2019)
trajectory of our Marketing function, empowering
our fearless commercial talent to drive growth and
“We’re going to touch more local brands. We’re going to spend more on local brands
allowing us to move at the speed of our consumer”
at the detriment of global brands. There will be a bigger increase in local brands, but
- Tim Cofer, Chief Growth Officer, Mondelez we will keep momentum in global brands that we see in China or Russia”
International (March 2018) - Luca Zaramella, CFO, Mondelez International (February 2019)