ZURICH (Reuters) – Nestle (NS:NEST) needs to take action on prices to encourage consumers to buy its goods, Chairman Paul Bulcke was quoted as saying on Tuesday following a challenging phase for the company that saw the departure of its CEO earlier this year.
New CEO Laurent Freixe took the reins at Nestle in September, replacing ousted Mark Schneider who had disappointed investors for several quarters with weak sales volume growth.
Under Schneider, Nestle slashed its marketing and advertising budget and invested less in innovation during the cost-heavy COVID-19 pandemic, and Bulcke said the company had had to increase prices during a subsequent period of inflation.
“That had an influence on sales,” Bulcke said in advance excerpts of an interview with Swiss television channel TeleZueri due to be broadcast later on Tuesday.
“We will balance that out now. Perhaps we went a bit too far with prices. That needs to be rolled back. The consumer must be able to buy our products. We need to act there,” he added.
The repercussions have weighed on the company’s revenue after shoppers switched to cheaper, better advertised or more innovative brands, eating into Nestle’s market share.