Reliable and robust
The travel-retail confectionery category is continuing to hold its own despite the economic downturn. David Davies spoke to two major suppliers to find out about their current activities and their plans for the future
The growth of the confectionery category has been one of the perpetual headline-generators in the travel-retail world for many years now. Emboldened by fresh thinking and creative ideas, suppliers and retailers have worked hard to expand the scope of this category, enhancing its appeal to all manner of possible purchasers – from travellers seeking a few moments of pleasure during their hectic journeys, to those in search of a delicious and attractively packaged gift for friends or family back home.
The good news is that, judging by the comments of our featured suppliers, the confectionery category is continuing to develop despite the current economic situation and declining passenger numbers. For sure, there is now an enhanced awareness that the offer must be matched by an appropriate price, and there is also some evidence that purchasing patterns are subject to change. But, by and large, there is no sign of the despondency now afflicting some other leading product categories.
Ferrero
This is a highly positive time for Ferrero, which recorded more than 50% growth in 2008 compared to the previous year. The company is continuing to expand its travel retail assortment and has recently added new product listings in a number of areas, particularly in Asia and Europe, but also in Americas where Ferrero is still a relatively new presence.
The last 12 months have also seen the company establish a new team dedicated to travel retail – a move that is said to have enhanced its relationships with clients and helped to forge stronger partnerships.
Katia Tonel from Ferrero Trading’s Travel Retail Division highlights the continued buoyancy of the confectionery category, whilst suggesting that travellers may have reduced their average spend and “redirected their choice: a box of chocolate makes a nice gift and is less expensive than a fragrance or other accessories. Nonetheless, the reduced number of passengers at the end of 2008 and the beginning of 2009 has influenced the confectionery sector as well. We experienced a slowdown in our Sell-In figures in the last months, especially in Asia and Middle East, which we think is partly due to the intention of retailers and suppliers to reduce their level of stocks and consequently their financial exposure. But Ferrero Sell-Out figures so far [have not suffered] so much as we think we still have some margin of natural growth due to the strong awareness of Ferrero products worldwide.”
In broader terms, Ferrero does not believe that current economic developments have had any great impact on its product selection. “The price point of our assortment is reasonable and we do not see a significant shift from one sku to the other. All the other novelties we have launched in the last months (for example Ferrero Collection, Garden, Kinder Bueno White) have performed particularly well.”
In any case, Ferrero does not expect the downturn in the market to last too long, and predicts a rise in activity levels later this year. “As far as Ferrero is concerned, we launched many novelties in Cannes last year which have so far achieved good sales, although of course we will wait until the end of the year to assess the results,” concludes Tonel, pictured here with the Ferrero team.
Beschle Chocolatier Suisse
Founded in Basel, Switzerland, in 1898, Beschle remains closely identified 111 years later with exclusive, handmade chocolates that appeal both to both connoisseur and luxury consumer. The company has a vibrant presence in both domestic and travel retail markets, and in 2009 offers an extensive selection of travel retail exclusive productions that includes Gold Collection Truffles, Boudour Collection and Perfect Match Collection: Rum Dream, among many others.
Beschle travel retail director worldwide Cornelia Maeder says that, like all other categories, confectionery is being affected by the economic downturn, but highlights confectionery’s ability to suit a wide variety of budgets. Beschle, she notes, is at the “highest end” in terms of luxury confectionery, and accordingly discounts and strong promotions are “not an option” in travel retail or domestic markets.
“We will always focus on our brand identity and make sure it is consistent across all outlets,” says Maeder. “So with this in mind we are taking our expansion plans more slowly and working with the right retail partners who can offer us the best location and also support our strong desire to offer a brand experience in store through promoters and tastings. This is where we can attract the customers’ attention and encourage sales and an ‘upgrade’ of purchase – we need to educate them about luxury confectionery. Our products are highly suited to travel-retail and have a strong gift potential. The packaging is very striking and high quality; the ingredients used and the Beschle craftsmanship are the best in the market.”
In terms of spreading the word about the brand, Beschle favours tasting opportunities and high-quality brand 
presentation, along with an emphasis on customer service. “Travel-retail is a very important environment for brand-building,” observes Maeder. “The exposure you can achieve in this channel is the highest in any location and this is why it is crucial that the brand values are not compromised and that retailers work with suppliers to develop the very best presentation for the brands and also for the category. Experience and theatre are definitely much more prominent in the category in today’s market, which is a positive thing.”
Looking ahead, Beschle plans to open a “selection number” of locations this year across Europe, the Middle East and Asia, and product-wise, will continue to focus on the current Travel Retail Collection and its Gran Cru bars.
“It is certainly a very challenging time for a new brand in travel-retail, but we are very confident we have something very different to offer the market, and are committed to developing a unique and successful offer in the global duty-free market over the coming year and beyond,” concludes Maeder.
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