The sweet maker is making the its biggest push after seeing marketing activity boost its brands amid poor sales for the overall confectionery category. It hiked marketing spend by 47 per cent year-on-year in 2013 and says this year’s outlay will be comparable.
Previous efforts delivered a 22 per cent year-on-year increase in value sales in 2013, according to Nielsen figures cited by Ferrero, and an additional 88 per cent in incremental sales. Category retail sales grew 0.9 per cent in the 12 weeks to 20 July 2014. The figures are backed by independent research from Euromonitor, revealing Ferrero has grown 0.1 per cent annually since 2012, while Mondelez, Mars and Nestle have all seen market share slide (see box below).
Jason Sutherland, sales director for Ferrero UK, says upcoming marketing aims to capitalise on the popularity of its brands in the UK, which are growing at a similar pace to emerging markets such as China. It hopes to yield around £650m sales from the region by 2019, the equivalent of around 5 per cent of the market.
A revamped £7m advertising campaign for Ferrero Rocher gets underway from October, introducing a new taste proposition. The two-pronged strategy promotes the craft behind the taste as well as pushing the brand beyond the formal, seasonal occasions previous efforts have targeted. Three new variant launches will fold into the seasonal activity with the business looking to beat the 16 per cent sales increase it posted last December.
Activity also covers email, social media, sampling and outdoor with the brand hoping to boost its share of voice in the run-up to Christmas against its larger spending rivals.
Additionally, the first major play for the Ferrero Raffaello range will run as part of the wider brand push, targeting younger consumers looking for an everyday premium treat. Ferrero launched the coconut-flavoured sweet in 2006 but says it lacked the scale to warrant major investment until now.
Elsewhere, Ferrero is set to launch a £2.3m ad campaign to promote its Pink and Blue Kinder Eggs in October. Ads will present the brand as being the “number one treat mums pick for their kids”, the company adds. A £1.7m “Find a Fiver” campaign will launch for Tic Tacs and is supported by brand partnerships including Dorothy Perkins, Topman and Cineworld. Ferrero views the sweet as pivotal to efforts to drive impulse sales among adults, who it claims view the category as “too kid-focused”.
A separate Nutella charge is on the way, attempting to further the brand’s efforts to be seen as a breakfast alternative. The business says Nutella is nearly as big as Special K in terms of its media spend and contributed £8.2m to a category that only grew by half a million in 2013.
Sutherland adds: “We continue to be disproportionate our spending above the line. It’s a very clear strategy for Ferrero. Despite the fact that we have a 3 per cent share of the confectionery market, we advertise heavier than a lot of our competitors and our share of voice in the category is 13 per cent. That’s almost 4 times broadly our share.”
The investment extends through-the-line to the brand’s ties with retailers. Ferrero is banking on a “theatrical” presence in-stores combined with increased sampling for all its brands to secure more impulse sales going into he crucial festive season. The plan could be met with some resistance as retailers mull following in the footsteps of Tesco and Lidl by ditching sweets from tills due to growing health concerns from the Government and campaign groups.
Ferrerro says it respects the decision of retailers “whatever they choose to do” but queried how mooted legislation around so called “guilt aisles” being ditched nationwide would play out in smaller convenience outlets.
Confectionery market share data 2012-1014: data provided by Euromonitor
|Mondelez International Inc||26.7||26.4||26.4|
|Haribo GmbH & Co KG||2.4||2.6||2.7|
|Chocoladefabriken Lindt & Sprüngli AG||1.6||1.8||2.0|