What does it take to make a bar of chocolate? Some milk, cocoa, sugar, a good recipe... Sure. Still, the advertising budget makes the difference. At least this is shown by the sales of Primola, the biggest advertising spender among chocolate producers this year.
Primola Prodimex, which entered the market last year, was quick to work its way up. Established by Supreme Imex with the cash resulted from the sale of the Nova Brasilia cafAé to Kraft, the company has mainly drawn the attention by its aggressive advertising, which has materialised in a $1.5 million budget this year (rate card).
Supreme Imex holds a stake in Primola Prodimex along with three other foreign shareholders.
The results: 30% share of the low-end chocolate market and four million dollars in sales estimated for this year, according to the marketing manager of the company, Cristian Stancu.
The low-end chocolate segment is estimated at some $13-$15 million, with the total retail chocolate market amounting to $70 million.
"Primola came with aggressive advertising, at a time when the competition was not really well represented on the market: Excelenta had about one third of Primola's advertising budget last year (i.e. $1.3 million rate card). They kept advertising all through the year, which made them more visible on the market. Furthermore, the commercial was quite interesting, it dealt with emotional values, and this always works," says Anca Banciu, a consultant with Roland Berger Strategic Consultants.
The Primola commercial was made by Saatchi & Saatchi and was based on a couple playing tricks on each other just to get to taste some chocolate.
Cristian Stancu says the results are satisfactory, yet this is only the beginning.
"The results are satisfactory, but they do not match those of our main competitors. We need to invest in this brand because the market demands it and the market is not the one it used to be back in '92 or '93. This is a long-term thing, we are not expecting to see results right away," Stancu says.
When Primola entered the market, the chocolate statistics were showing the retail market amounted to approximately $70 million, with Kraft Foods, Nestle, Heidi, Kandia and Excelent as leaders, accounting for 81% of the sales volume and 80% of the market value, according to ACNielsen market survey.
"The market has increased very little in terms of value this year, with consumers going for expensive products mainly, given the repositioning of Heidi and Milka, that are now aiming at the high-end segment," Banciu says.
In his turn, Stancu says consumers are migrating from one brand to another this year.
"The development of the market this year consisted in new quality products offered by producers such as Kraft, Heidi or Primola, as well as in the assimilation of certain brands, which are now produced in Romania - Milka, for instance. Unfortunately, consumption is not going up right now, people are moving from one brand to another depending on the consumer budget and the supply of new products," Stancu said.
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