From Milkmaids to Multinational Markets: Nestlé’s Branding Story
By Catherine Jewell, Communications Division, WIPO
With operations in 150 countries, Nestlé is a world-leading food and drink company. Intellectual property (IP) has been in the company’s DNA since its founder, Henri Nestlé, began producing his breakthrough infant formula –“farine lactée,” a combination of cow’s milk, wheat flour and sugar – in 1867. Today, the company owns over 2,000 brands, 30 of which generate more than a billion Swiss francs in annual sales.
As a major user of the WIPO’s Madrid System for the International Registration of Marks, Nestlé’s Hubert Doléac, Senior Legal IP Counsel at Nestlé Legal, explains the importance of trademarks to Nestlé’s success.
How big is Nestlé’s global footprint?
Nestlé operates in over 150 countries and employs around 335,000 people. We have 436 factories in 85 countries. Nestlé is a market leader in most of the food and beverage categories in which it operates, but our ambition today is to enhance people’s quality of life through nutrition health and wellness with science-based innovations. This goes far beyond the goals of a standard food and beverage company.
Why is IP protection important to Nestlé?
As a marketing pioneer, Henri Nestlé was fully aware of the importance of brands and protecting them. From the outset he insisted on consistent use of “Nestlé” on all his products. He created the eye-catching bird’s nest logo in 1868 to ensure that consumers could easily identify his products wherever they were sold. It was inspired by his family coat of arms. That logo has since become a “seal” guaranteeing the high quality of the products that bear it.
The Nestlé Group still believes in and is committed to developing strong brands around high-quality products that consumers can trust. Today, Nestlé owns more than 2,000 brands, protected in over 170 countries. Over 30 of these are what are known as billionaire brands, each generating at least one billion Swiss francs in annual sales.
How does Nestlé manage its trademarks?
Nestlé’s trademark portfolio is managed centrally by our IP team at the company’s Swiss headquarters in Vevey. The team comprises 12 IP counsels and around ten paralegal staff. We work closely with our businesses across the globe, providing legal advice and recommendations on how best to protect their ideas and creations to ensure their projects get off the ground smoothly. This involves identifying potential prior rights and eliminating any potential obstacles, securing ownership of relevant copyrights, and working with our businesses to define appropriate protection strategies in accordance with the importance, nature, scope and planned geographical extension of their project. Of course, we also monitor and defend the corresponding protections against any unauthorized use.
To ensure we have a coherent trademark protection strategy across all our businesses, we have created an IP network with “IP champions” in 48 countries.
How does the company keep pace with changing consumer tastes?
With over 10,000 different products – and over one billion of them sold every day – Nestlé has products for every moment of every day, morning to night, and for every age. To meet consumer expectations, we tailor our products to local tastes and needs. For example, Nestlé has over 200 different blends of Nescafé!
You have both strategic and local brands. How does that work?
If Nestlé’s management and our business colleagues think a brand can become a major commercial asset for the company then it will be positioned as a strategic brand. We have worldwide and regional strategic brands, the latter serving a specific geographical zone or continent. All associated brand communication and positioning for strategic brands is defined by the business units at headquarters and endorsed by management. All the local Nestlé companies that want to use the brand need to apply the associated brand guidelines.
Local brands, which are most relevant to specific markets and respond to local needs and tastes, vary in number from business to business. There is greater latitude in communicating about and using these brands. Some of them can be extremely valuable and are critically important for the market concerned.
We regularly review and make adjustments to our brand portfolio and eliminate those that are no longer commercially relevant. With the explosion of social media platforms, there is a clear tendency to rationalize, globalize and move to a “one-brand strategy”. This not only simplifies the communication around our brands, but also makes it easier for us to connect with our consumers and helps build faster international awareness of them.
What does it take to build a global brand?
To develop a global brand you need a well-defined branding strategy – one that covers both brand positioning and IP protection – and consistent use and communication across markets. And you need to build up and maintain trust in the quality and image of your brand among consumers. That can take many years.
When did Nestlé register its first trademark and what is its most recent trademark registration?
Nestlé’s oldest national trademark was registered in Hong Kong in 1874 and is still active. At that time, Switzerland did not have a national trademark law in place. The bird’s nest logo was first registered with the court in Vevey in 1875. Only in 1890 was Henri Nestlé able to register it as a Swiss federal trademark.
We regularly file new trademark applications to cover our diverse projects. For example, in April 2016 we filed 137 new trademark applications ranging from new coffee varieties for our Nespresso business to nutrition, pet food and ice-cream brands. The nature of the applications varies in line with the geography and product categories. For example, we have a new brand called “Tyanouchka” for confectionery, and “Little Nightmares” for ice-cream in the Russian market and those of former members of the Commonwealth of Independent States (CIS), and “Arondio” for a new Nespresso variety globally.
When did Nestlé start using the Madrid System for the International Registration of Marks?
Nestlé started to rapidly internationalize its activities at a very early stage. The Nestlé Group was formed in 1905 with the merger of the Anglo-Swiss Milk Company, established in 1866 by brothers George and Charles Page, and Farine Lactée Henri Nestlé, founded in 1866 by Henri Nestlé. The company grew significantly in the first half of the 20th century, expanding its offerings beyond its early condensed milk (sold originally under the brand: “La Laitière”, “Milkmaid”, or “Milchmädchen”) and infant formula products. Nestlé’s oldest active international trademark registration issued in the name of Nestlé and Anglo-Swiss Condensed Milk Company (the name under which it traded at that time) dates back to 1895 and relates to the “Milkmaid” brand!
What are the main advantages of using the Madrid System
The Madrid System really does simplify the management of our trademark portfolio. It offers a number of advantages. For example:
- It means we can file a single international application with one office in one language (English, French or Spanish), and pay one set of fees in Swiss francs to seek international registration in multiple countries;
- We can designate the countries in which we want to protect our trademarks and as our business expands or new countries join, we can subsequently extend our rights if we need to;
- Fees are pre-established and known in advance, so there are no surprises in relation to costs; and
- Its centralized filing and management system means users like us can record changes of ownership in a single step.
What opportunities and challenges do social media platforms pose to Nestlé?
Social media platforms, and more generally e-commerce, are changing the landscape and the way companies like Nestlé are proposing and selling products. Nestlé has fully engaged and is very active today with sales of over CHF 4 billion on those platforms. They represent a huge opportunity to engage with consumers, and to better understand their needs and concerns.
How do you tackle counterfeit or look-alike products?
Counterfeiting affects Nestlé as much as any other consumer goods company. Given our uncompromising food and safety standards, we take all necessary measures to protect our brands, in the interest of our consumers. This includes building strong relationships with enforcement authorities and local customs to raise their awareness of our trademark rights and to help spot counterfeits.
The monitoring and defense of our IP rights is a core part of our activities. We differentiate between counterfeits (exact replicas of our original brands) and look-alikes (imitations of some features of our original products and brands) and carefully assess the corrective measures we can take to safeguard our rights in the interest of our consumers and businesses.
Last but not least, what is your favorite Nestlé brand?
It’s hard to choose from among all of Nestlé’s excellent products but at the end of the day it has to be “Kit Kat”.
The WIPO Magazine is intended to help broaden public understanding of intellectual property and of WIPO’s work, and is not an official document of WIPO. The designations employed and the presentation of material throughout this publication do not imply the expression of any opinion whatsoever on the part of WIPO concerning the legal status of any country, territory or area or of its authorities, or concerning the delimitation of its frontiers or boundaries. This publication is not intended to reflect the views of the Member States or the WIPO Secretariat. The mention of specific companies or products of manufacturers does not imply that they are endorsed or recommended by WIPO in preference to others of a similar nature that are not mentioned.