Danone global strategy

Résumé du document

Danone is one of the world leaders in the food industry. The group focuses on three worldwide business lines: Fresh Diary Products, Beverages, and Biscuit & Cereal Products. Its turnover in 2005 was 13.02 billion Euros. We have chosen this group because Danone seems to be a very dynamic firm. In 2005, the group had one of its best organic growths ever: 6.7 %. Moreover, the food market is deeply involved in globalisation. This leads to two different trends when turning to the global market: the homogenization of behaviors (more and more people eat the same products) and the adaptation of firm's strategy to various local markets. Danone was created in 1966, and at the beginning, the focus was not on food but on glass containers. Then, little by little, Danone diversified its production in several food sectors. In 1996, a new impetus was given with the arrival of Frank Riboud at the head of the group. He introduced new methods and strategies to meet the expectations of consumers. Indeed, today, consumers expect from food industries not only to feed them but also to cure them, to help them become finer, younger and more beautiful, which is the reason why Danone's core business is "to bring health through food". This demand has led Danone to dedicate an increasing influence and part of budget to intellectual capital at the expense of financial capital. Moreover, Danone has to find a balance to satisfy a growing market while at the same time remaining close to consumers.

Extraits

[...] The group sold Panzani, Maille, Amora, William Saurin, Carambar, La Pie qui chante. Danone's new strategy was no longer to diversify its production, which implied huge costs of organisation, but to focus on its three core businesses (fresh dairy products, beverages and biscuits and cereal products) and to conquer new frontiers. This new strategy enabled Danone to follow more closely the evolution of its core businesses instead of dissipating its efforts in too many sectors. In 1981, Nestlé, Danone's main competitor adopted the same strategy. [...]

[...] Indeed, Danone was able to change its strategy, to forgo the use of its name brand and to adapt itself to Chinese nutritional customs. III. Communication strategy 1. bring health through food” In order to seduce its consumers, Danone promotes its products as good for health. Nestlé, its main contender, has the same strategy with its slogan “Good health, good food”. Danone emphasises the “scientific” aspects of its production. It claims that all its innovations are based on scientific and medical research that guarantees good health. Research at Danone is made at Danone Vitapole, based in Palaiseau, in the south of Paris. [...]

[...] In Asia, sales were up by 14%. Aqua in Indonesia and Wahaha in China accounted for almost all volume in Asia. In Latin America, the main sources were Argentina with Ser, a brand focusing on fitness and Bonafont in Mexico. Results in Europe were uneven. There were positive trends in the UK and in Germany and weak performances in France. Top brands of Danone's beverage sector are: Evian, Wahaha in China, Aqua in Indonesia, Bonafont in Mexico and Ser in Argentina. [...]

[...] Danone global strategy Introduction I. General presentation of Danone: past and today's position 1. Danone's position in the food market 2. Background history of the group 3. Division by sector 4. Geographical Division II. Danone global strategy 1. Internationalisation: to take over 2. Concentration on three core businesses 3. China: an exception to Danone's strategy III. Strategy of communication 1. [...]

[...] Global strategy of Danone 1. Internationalisation: to take over During the nineties, Danone developed beyond Europe's borders because the European market was saturated. New hopes involved emerging markets such as those of China or India, where politics encouraged foreign investments. In the market of fresh diary products, Danone appeared in Argentina, the United States, Poland, and Turkey. In the market of bottled water, Danone invested in Argentina. In the market of biscuit and cereal products, Danone invested in Poland, Colombia, Tunisia, Morocco, and Brazil. [...]