Nestlé Prepared Foods, a division of Glendale-based Nestlé USA, plans to lay off 103 employees from its Chatsworth facility effective Feb. 1 following a sales decline in its frozen food sector. The facility, which currently employs 645 workers, specializes in the manufacturing of popular frozen food brand Hot Pockets. The move marks the second round of layoffs for Nestlé in the past 12 months. Last year, Nestlé Nutrition announced the closing of a facility in St. Louis Park, Minn., in which 243 workers would be phased out by this December. The economic downturn has hit the frozen food sector from multiple sides, pushing up the cost of ingredients and forcing changes in consumer behavior that have hurt sales. Consumer frugality is causing them to make different choices when it comes to food purchases, said Roz O’Hearn, spokesperson for Nestlé Prepared Foods. The Chatsworth layoffs are a way for the company to restructure and be more efficient in its operations. “We’re trying to remain competitive in the backdrop of a difficult financial situation,” she said. In its mid-year financial report, ended June 2011, the company reported its Zone America sales were $13.7 billion, a 6 percent decrease from $14.6 billion in 2010. In keeping with its competitive pursuit to boost sales, Nestlé USA has also devised new marketing tactics to tackle emerging markets in the U.S. and help drive sales of all of Nestlé brands. Last year, Nestlé USA’s Emerging Markets Division launched a new communication platform targeting one of the fastest growing populations in the country: Hispanics. With Hispanics accounting for about 16 percent of the U.S population and carrying a spending power of almost $1 trillion, campaigns targeting the rapidly growing population are hardly new. Companies such as General Mills Inc. and Kraft Foods Inc. have been staking out the Hispanic food market in the U.S. for years. Although Nestlé USA is already established in the market through its traditional Hispanic brands such as Abuelita chocolate, La Lechera and Nescafé, its new platform, called Construye El Mejor Nido, is pushing other products such as Juicy Juice, Digiorno Pizza and Hot Pockets that may not be as familiar to the Hispanic consumer. “It’s the first time we integrated consumer and shopper marketing efforts to span the entire path to purchase in a multi-brand effort,” said Margie Bravo, marketing manager of Hispanic brands at Nestlé. The platform includes several outlets that aim to attract Hispanic consumers including a Facebook page, in-store marketing techniques, television commercial campaigns and a bilingual website. While Nestlé is certainly not the first major corporation to recognize this emerging market segment, Bravo said her company’s timing is in line with the coming of age of this new generation of bicultural Hispanic consumers. “That’s why we’re doing it right now,” Bravo said. “The Hispanic consumer has the need to remain connected to their roots while also engaging with the (American) lifestyle.” The website has generated buzz with the addition of its blog, which features four Hispanic mothers living in the U.S. In their posts, the mothers share family memories and favorite recipes. From Juicy Juice sangrias to Nesquik and banana smoothies and traditional tortilla soup, the bloggers offer a fusion of flavors and ingredients while consistently incorporating Nestlé products. Claudia Goffan, founder of Atlanta-based Hispanic marketing agency, Target Latino, said Nestle’s new platform is a should produce positive results for the company. “It will call attention to the more traditional items,” Goffan said. “They’re basically saying ‘you know and trust our brands so try these products too.’” As of December, about 130,000 people have signed up to follow Nestlé’s blog. Construye el Mejor Nido will continue to evolve and expand in the coming year, Bravo said. While specific projects could not be disclosed, new product launches, advertisements and website enhancements are on the horizon for this year.
Hot Pockets Not So Hot as Nestlé USA Cuts Jobs
