Mondelez International's global net profit declines, important executives of Chinese company under investigation
JESUS60
发表于 2024-8-2 20:43:06
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Recently, retail giant Mondelez International disclosed its Q2 2024 performance report. According to the financial report, Mondelez International's net revenue for the quarter was 8.343 billion US dollars, a year-on-year decrease of 1.9%; The net profit was 601 million US dollars, a year-on-year decrease of 36.3%.
Regarding the decline in performance, Mondelez International stated that it was mainly due to currency exchange rate fluctuations, rising commodity costs, unfavorable changes in sales volume and product mix, and the divestment of its chewing gum business from developed markets.
As a super snack manufacturer, Mondelez China owns multiple brands including Oreo, Queduo, Youguan, Xianqu, Wangzi, Taiping, Lezhi, Yikoulian, Hershey's, Xuanmai, Miaoka, and Guozhen.
From a regional perspective, in the second quarter of this year, Mondelez China's Asia, Middle East, and Africa region had a net revenue of 1.587 billion US dollars, a year-on-year decrease of 1.4%, with an organic growth rate of 4.2%; Sales in the Latin American market increased by 0.3% to 1.232 billion US dollars, with an organic growth rate of 4.5%; The sales in the European market decreased by 1.8% year-on-year to 2.874 billion US dollars, with an organic growth rate of 2.7%.
During the earnings conference call, Mondelez Global executives mentioned that the Chinese market recorded high single digit growth during the period, mainly due to the continuously strengthening core product brand assets and coverage of more distribution channels.
In fact, as early as the 2023 performance meeting, Dirk Van de Put, CEO of Mondelez International, expressed his idea of further expanding distribution channels in emerging markets, including China, by selling Oreo and other products through more convenience stores and mom and pop shops. He revealed that about 50% of Mondelez's organic growth in emerging markets is driven by distribution expansion, and if we look globally, about 2% of its additional organic growth comes from this.
To make more money in China, Mondelez's strategy is divided into three parts - expanding its sales network in lower tier markets, providing more new products to the middle class in first and second tier markets, and doubling its e-commerce sales by 2025.
In April of this year, Mondelez executives in China revealed that their sales network in China has increased by over 700000 outlets in just three years since 2019; Offline, cookies are currently sold in 3 million stores, and chewing gum is sold in over 2 million stores. At the same time, we cooperate with O2O platforms such as Meituan and social media.
In order to seek new growth points at the product level, Mondelez China is also making efforts. In recent years, we have been continuously adding new flavors to Oreo, not only launching zero sugar Oreo for the Chinese market, but also introducing innovative flavors such as Yangzhi Ganlu and Peach Blossom Rice Wine.
In addition, combining Oreo with other product categories to launch new products has become an important means for Mondelez to drive demand growth.
In May this year, Nestle China announced that it had obtained the authorization of the Oreo brand to produce and sell Oreo ice cream in Chinese Mainland, including three product forms: cone, cup and family sharing barrel.
In the baking industry, Oreo has also ventured into it and will launch products such as frozen Oreo cheesecake and ambient temperature Oreo cloud cake in 2022.
Feng Pude has stated that products such as Oreo Cloud Cake, which have already been launched in China, are considered "major innovations" and have the potential to bring tens of millions of dollars in net revenue to every country.
But in the domestic baking market, Oreo flavored cakes are already very common in the baking industry, and the overall competition in the domestic baking industry is extremely fierce. According to the 2021 Baking Industry Development Trend Report, the market size of China's baking industry was 235.8 billion yuan in 2020, with a growth rate of over 9%. In 2020, the top 5 companies in China's baking industry had a market share of only 10.8% of the entire industry, namely Dali Food 3.6%, Taoli Bread 3.5%, Panpan Food 1.6%, Haoliyou 1.2%, and Binbao 0.9%. The baking industry is developing rapidly, with many entrants and low market concentration.
In the view of Chinese food industry analyst Zhu Danpeng, consumer fatigue also exists. Overall, the innovation, upgrading, and iteration of Mondelez are relatively slow. Although Oreo has some minor innovations, the overall effect is not good. So the key to Mondelez lies in the level of the entire operator and the investment of resources in the Chinese market, which cannot match the overall consumption upgrade, product upgrade, taste upgrade, and the transformation of new and unique consumption thinking in China.
The bigger crisis for Mondelez in China is the investigation of its Chinese executives being taken away by relevant departments.
According to a report by self media food reference on July 25th, two executives from Mondelez China were suddenly taken away on suspicion of embezzlement and large amounts of money. At the same time, their employee accounts were cancelled, computers were confiscated, and related structures were also lost. That evening, Mondelez China held an impromptu meeting to discuss this matter; At the meeting, Mondelez specifically requested that company employees "refrain from speaking" about this matter.
According to the screenshot cited in the above report, the executives involved are Grace Zhu, Vice President of Marketing and Development at Mondelez Greater China, and Simon Xiu, Director of E-commerce at Mondelez China.
In response to this, Mondelez China responded to relevant media by stating that the two employees are cooperating with the investigation and are in a state of departure. Information will be released in a timely manner based on the official investigation results.
According to public information, Zhu Yijing joined Mondelez China in May 2019. From 2019 to the end of 2021, she served as the Sales Director of Mondelez Greater China and subsequently as the Head of the Marketing and Development Department of Mondelez China. Her main responsibilities include marketing, consumer insights, e-commerce, and catering channels. Prior to this, she had worked at companies such as Nielsen and PepsiCo.
Xiu Zerong's position is the E-commerce Director of Mondelez China Greater China, responsible for e-commerce and O2O business. An industry speech event in February 2024 introduced him as having 20 years of experience in the fast-moving consumer goods industry, with a deep understanding of offline KA channel customer management, online e-commerce channels, and O2O business development.
At a critical moment when Mondelez China is seeking expansion, it remains to be seen what changes will occur if two important executives are taken away for investigation.
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声明:该文观点仅代表作者本人,本文不代表LogoMoney.com立场,且不构成建议,请谨慎对待。
声明:该文观点仅代表作者本人,本文不代表LogoMoney.com立场,且不构成建议,请谨慎对待。
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