A category to watch out for

'Lot of action coming up'

Ragesh Bhatia, Director, Rex Enterprises;
 
The Confectionary industry has been buzzing in the last couple of years with new multinational entrants trying to capture market share and traditional giants working hard to consolidate their dominance.

We see 2 types of assets in this sector  - one targeted at the impulse purchase and the second during festivals seasons for gifting. We are also seeing a shift in the demographics of consumers towards more teenage and adult purchases with specific offerings. All these have a clear bearing on the kind of assets brands are designing to build retail presence.

Refrigerated assets are increasingly being deployed by several brands thus building permanent visibility at store. We are even looking at customized illuminated panels and store counters made as per store sizes, which build permanent visibility - giving the brand the highest share of voice in the store.

Recent innovations we are working on include counter top units that we can cool chocolates without the need for electrical connections - especially useful in most of India where we are looking for a low investment per outlet.  Also, we have created display cum stocking units that have detachable "legs” which can stand up above the clutter on the front counter.

In the modern trade, category management solutions with the use of aromas to seduce shoppers were an interesting innovation. Iconic metal boxes, are now giving way to sleeker and modern looking HIPS thermoformed units that definitely upgrade brand image and enhance appeal to the younger audience. We are setting up a huge new plant for thermoforming and expect confectionaries to take up a significant portion of the capacity.

With several more brands and new sub categories being created everyday, we are definitely looking at lots of action in this sector in the years to come.

'Innovations will be driven by GT retailers'

Balaji Murugesan, Director, SAB Creations Pvt Ltd:

Confectionery has become more premium not only in MT but also in GT. This is primarily due to foreign competition. In India international products are doing well and the products in their portfolio will be growing.

We are already seeing that the bar has been raised for both GT and MT. In GT there is only one issue in the context of visibility, unlike in MT where there are multiple issues.

But solutions in MT have also become very limited now, as we have fully explored the space now. During the first five years, everything was new, but now there are lot of retailers who have their say in placement and the rental costs have also touched the sky.

Another difference is that in GT, only the retailer needs to be on board, unlike in MT where one has to go to too many people including the store managers and the marketing people. Anyone can cut a project in MT due to the number of people involved in making decision.

Confectionery as a category will always be on the forefront when it comes to impulse category and with kids being the target audience and the brands will always strive to convert them into a loyal customer base.  

The category is making money and it is a very stable one. But to be innovative in this category is a cost spending exercise, though in the next two years you will find lot of innovations in the GT space, which will be driven by the changing retailers. GT is getting more upmarket and everyone wants to upgrade presence here.

'Innovative packaging plus POS is critical'

Haresh Mehta MD, Jayna Packaging Pvt Ltd:

A lot can be done in this category mostly in packaging. Being targeted primarily at kids, the packaging can be done very innovatively by converting it into a do-it-yourself kit. For example, a few years back we created a chocolate package with directions for creating a flute out of it after consuming the product. There is a great opportunity here which needs to be tapped. There is no brand loyalty in this category as it is an impulse driven one and the target group is kids who love freebies like gift hampers which can be converted in to great value for children. All of this makes their perceived value much higher and creates a lasting impression. Brands can come together and plan a scheme which can set a trend - like Kinderjoy which comes with its own DIY toys. It creates a lasting impression.     

POS is again important as it a reminder medium. Thus a good combination of packaging and POS works well. Packaging alone may get lost on the shelves.

Brands are open to innovations and customizing their design and packaging, though a lot of redesigning is happening in gift packaging like Diwali packaging and Raksha Bandhan packaging, which is secondary packaging and not in original packaging.