Nestlé: Confectionery innovation on a global stage

Nestlé confectionery innovation – summary

• Nestlé drives growth through indulgent formats, flavour extensions and sugar‑reduction
• AI deployment enhances supply chains, manufacturing efficiency and global consumer experience
• Strong R&D investment strengthens innovation leadership over major confectionery competitors
• Brand popularity varies globally with KitKat dominating several key markets
• Rising GLP‑1 use boosts demand for low‑sugar confectionery innovations

Nestlé is the world’s biggest CPG.

And with revenues topping $14bn (€11.8bn), and big-name brands including KitKat, Smarties, Milkybar and Munchies in its arsenal, it’s also the fourth biggest confectionery manufacturer.

So, what’s the Swiss multinational’s secret to success? And what does the future hold?

Nestlé’s secret to success

Nestlé’s known for its confectionery innovation, especially when it comes to its most loved brands.

“Nestlé has traded-up familiar products by expanding into more indulgent, shareable formats such as KitKat tablets with richer, creamier fillings, and through flavour extensions like cookie-dough KitKat,” says Kasia Davies, data journalist for consumer goods at company for statistical and market data, Statista.

The sweet maker also offers on-the-go and travel-friendly products, targeting consumers searching for snacking convenience.

What’s more, Nestlé has addressed the rise of permissible indulgence by investing in new sugar-reduction technologies and offering lighter ways to enjoy confectionery.

“Over the past years, we’ve shifted from thinking in strict product categories to innovating around how people truly snack today,” says Nestlé spokesperson Chiara Valsangiacomo. “Consumers move between indulgent and healthier choices, often within the same day, and our portfolio strategy reflects that.”

All this keeps flagship brands fresh and exciting, and consumers coming back for more.

Nestlé also aligns innovation with the growing need for sustainable sourcing, launching initiatives like the Nestlé Cocoa Plan.

Plus the Vevey-headquartered business is in the process of deploying AI across the company, streamlining supply chain operations, manufacturing, distribution, and consumer experience.

Nestlé’s biggest chocolate innovations

When it comes to confectionery innovation, Nestlé’s certainly had a lot of success. But “there are two products that stand out”, says Statista’s Davies.

The first is the now discontinued vegan KitKat. The plant-based bar, which was ultimately pulled from shelves due to declining demand, showed Nestlé’s drive to push beyond the norm being, as it was, one of the first majors to offer animal-free.

Davies’ second pick is the Milkybar Wowsomes, which used Nestlé’s enzymatic sugar-reduction process.

“It was a complete technological breakthrough,” she says. “It demonstrated the company’s commitment to R&D and offered consumers a distinctive alternative to what was available on the market at the time.”

This too has since been discontinued, but Davies suspects the growing demand for low-sugar alternatives could mean it makes a return in the future. And, as Nestlé owns the patent for the technology, “they hold a potential advantage over their competitors”.

Success in numbers

Consumer insights reveal where Nestlé’s brands hit hardest, with Statista Consumer Insights data showing their popularity varies widely from market to market.

The UK is a major market for Nestlé. KitKat ranks number three among the most consumed brands, with 50% of consumers buying it regularly. Aero (38%), Milkybar (24%), Lion (22%) and Yorkie (21%) also rank highly.

In the US, around 42% of people buy KitKats, although it’s licensed to Hershey. Crunch is also popular, and eaten by 29% of consumers.

Germany doesn’t rank Nestlé as highly as its competitors, with KitKat the only brand that makes the list of the most popular chocolate bars, taking a share of around 33%.

By contrast, Brazil is a big buyer of Nestlé brands with five in the most consumed chocolate bars list. The top position was secured by Nestlé, a pure milk chocolate bar which was enjoyed by about 68% of Brazilians. Garoto came in second place at 67%, KitKat third at 58%, Talento fourth at 38%, and Kopenhagen fifth at 30%.

Similarly, Nestlé brands are massively popular in India. KitKat is the second most consumed chocolate bar with 74% of the population buying it. Next up Munch (52%) and Milkybar (51%), and around a third of consumers buy nougat-based BarOne.

Meanwhile, in Mexico, Nestlé owns one of the most popular candy bars, Carlos V, which is bought by around 70% of the population. KitKat (42%) and Crunch (35%) are again big hitters here.

Trust and heritage health play a key role in Nestlé’s success, says Statista’s Davies.

With brands like KitKat and Milkybar, it’s offering a range of products that have been with most consumers since their childhood.

Nestlé’s confectionery competitors

“The main competitors to Nestlé are Mondelēz International, Mars Wrigley, Hershey, and Ferrero," says Statista’s Davies.

And interestingly, though perhaps unsurprisingly, their innovation strategies have a lot in common.

“Most of them boost incremental innovation, occasion-led strategies, as well as AI usage, and they all address sustainability and health concerns,” she explains.

But, the financial investment tells a different story.

Nestlé, she says, spent 1.67bn CHF on research and development in 2024, in contrast to Mondelēz’s $400m (307m CHF).

“We have wide-ranging science and technology expertise in areas such as nutrition and taste, food safety and quality, affordability and cost, as well as researching innovative solutions that help to ensure the future supply of raw materials like cocoa,” says Nestlé’s Valsangiacomo. “At our R&D Centre in York, England – a global hub for confectionery innovation – we leverage this wide-ranging science and technology expertise and our deep understanding of consumer trends to create great-tasting products."

Growth potential

Nestlé’s strong investment in R&D and its steady stream of innovative launches show just how closely the company tracks consumer behaviours.

“We’re continuously following new technological and consumer trends,” says Nestlé’s Valsangiacomo. “Many of our latest KitKat innovations are designed to meet growing consumer demand for multisensory experiences – both our recently launched KitKat tablets and KitKat F1 chunky bars were created using our proprietary technology."

At the same time, the rising use of GLP‑1 medications is set to reshape the confectionery landscape. Nearly half (46%) of US GLP‑1 users report buying less food, and many are seeking low‑sugar versions of the treats they love.

And although Nestlé has previously stepped back from some reduced‑sugar products, such as Milkybar Wowsomes, shifting attitudes around sugar could create a far more receptive market. In this new environment, low‑sugar innovations may have their strongest chance yet to succeed.

What the future holds for Nestlé

If anything is clear, it’s that Nestlé’s confectionery success isn’t built on nostalgia alone. Yes, its brands carry decades of heritage, but the company’s ability to continually reinterpret those brands for new generations is what keeps it ahead of competitors.

Whether through breakthrough sugar‑reduction technologies, AI‑driven manufacturing, or a deeper understanding of how and why people snack, Nestlé is positioning itself not just to respond to market shifts, but to shape them.

As economic pressures, health priorities, and sustainability expectations continue to push the industry towards change, confectionery makers will need to innovate with more precision than ever before. Nestlé’s substantial R&D investment suggests it intends to remain at the forefront of this evolution.