India is a market of small transactions, Says Ferrero India MD Stefano Pelle


India is a market of small transactions, is how Ferrero India MD Stefano Pelle defines the Indian market. In an exclusive interview with Brand Equity, Pelle, 56, says the premium Italian chocolate and confectionery brand, and maker of the 'golden laddoo', is continuously strengthening its suite of offerings with product innovations which are made in India and made for India.

What factors in your opinion worked for Ferrero Rocher to emerge as one of the most preferred gifting choices in a price-sensitive and traditional market like India?

Can you share the growth trajectory of Rocher and other key products in India for next 2-3 years from a diversification point of view?

Ferrero India is expanding its product portfolio and actively looking at opportunities available for its current brands. In August, the company forayed into the kids snacking segment with the launch of ‘Kinder Creamy’ under the tropical portfolio. This product is launched in south India and with this new offering we aim to make deeper inroads into India’s chocolate category. It will be launched pan-India next year.

We are also looking at expanding our product portfolio in the sugar and confectionery segment. As families and individuals spend more time cooking at home, Nutella has witnessed an increase in demand. We are expanding Nutella in ecommerce as well as more traditional trade stores. Kinder Joy is the fastest selling brand in India.

Does India figure as a key market in terms of sales around festivals for Ferrero?

Our sales increase during festivals by 15-20%. In fact, Ferrero Rocher is synonymous with premium gifting in India.

Through our marketing and very selective distribution initiatives we amplify this emotion. We ensure that Ferrero Rocher is distributed to the right stores where the storage temperatures can be maintained, and the quality of our brand is not compromised. Close to 40% of our sales for Ferrero Rocher happens around Diwali.

Is there a plan to make Rocher and Nutella in India?

Ferrero Rocher Moments is produced in the Baramati factory. In the coming months, we will also start exporting FRM to other countries from India. Due to our premium positioning our current volumes do not justify investment for local production facilities. However, in the future, as we increase our penetration into the Indian cities, we may consider that possibility.

The average per capita consumption of chocolate is 200 gm a year in India versus 8 kg in the UK, Europe and Australia. Do you see a lot of scope for growth in India?

India is a market of small transactions. Collectively, the millions of smaller transactions that happen in India are much bigger than the larger transactions which happen in other countries. The large and young population is the future of the chocolate category. The Indian market will always be driven by smaller transactions therefore Re 1, Rs 5, Rs 20 will be the penetration price points.


News Source: Economic Times