PERFETTI VAN MELLEProject on STOP NOT

By

MANAGING DIRECTOR-PERFETTI VAN MELLE

SAMEER SUNEJAMANAGING DIRECTOR, PERFETTI VAN MELLE INDIA

Sameer Suneja, Managing Director, Perfetti Van Melle has been with the Indian confectionery major for 15 years now. Accredited as among "India's Hottest Young Marketers" in 2005 by Brand Equity and also one of "India's Hottest Young Executives" in 2008 by Business Today, Sameer is largely responsible for building the brands at PVM and creating some memorable and award winning advertising. Sameer joined PVMI during its start up days and has played a key role in the company's distinguished growth over the years. Perfetti Van Melle is the undisputed leader in sugar confectionery today and most of its brands are market leaders in their respective segments.

Sameer joined the company as a Brand Manager in 1997 and subsequently moved to Milan for an International Marketing assignment where he spent a couple of years. He returned to India in early 2002 and was the Head of Marketing and subsequently became Head Sales and Marketing. He became the Managing Director three years ago and is among the youngest Managing Directors in the country running a company with a turnover of 1200 Crores. During his stint as a Managing Director, the company has seen exponential top line and bottom line growth.

An MBA from IIM Bangalore ('94 batch), he started his career at Colgate Palmolive. From there he moved on to Frito-Lay before joining Perfetti Van Melle. Website: http://www.perfettivanmelle.in

GLOBAL OVERVIEW OF PERFETTI VAN MELLE

Largest Manufacturer of Confectionary and Chewing-gum products.

Two brothers Ambrogio and Egidio Perfetti founded “Perfetti” in 1946.

Izaak Van Mella founded “Van Melle” in 1841.

“Perfetti” acquired “Van Melle” in Jan 2001 and became “Perfetti Van Melle”.

PERFETTI ‘S BRANDS IN INDIA

Alpenliebe Center Fruit Chlormint Chocoliebe Creamfills Mangofillz Marbels Mentos Big Babol Center Fresh Happydent Wave Happydent White Sugar Free Lollipops Center Shock Fruitella

STOP NOT

Perfetti van Melle, a leading confectionery maker, forayed into the Rs 3,000 crore Indian packaged snacks market with its own brand of snacks called ‘Stop Not.’

Launched in Dec’11.

Currently available in “Golz”(ring shaped) category with 4 exciting flavours.

THE INDIAN SNACKS MARKET

 According to a study by McKinsey&Co, the Indian food market will grow two fold by 2025 with the rapidly growing Indian economy and improving lifestyles of Indians contributing in a big way to this growth.

The Indian snacks market is worth around US$ 3 billion.

The snacks Market in India is growing at a rate of 45 % every year.

Frito-Lays, Haldirams,etc are some of the dominant players in the market.

MAJOR COMPETITORS

Frito-Lays-Kurkure,Uncle chips, Lays,Cheetos

Parle- Wafers, Hippo

Haldirams- Chips,wafers,mixtures

ITC- Bingo, Mad angles, Tangles

SWOT ANALYSIS ON STOP NOT

Strengths

STRONG BRAND VALUE : The product comes with the “PERFETTI VAN MELLE” tag so its needless to say it has a pretty strong brand value.

ATTRACTIVE PACKAGING: The management has given the product a very impressive packaging, quite different from competitors’.

STRONG DISTRIBUTION CHANNELS : As the company is already into dominant confectionary business, it doesn’t require to explore for the markets.

EXPERIENCED MANAGEMENT TEAM : The company is running by a quite experienced management team operating in India for the last 16-17 years.

GOOD MARGIN FOR RETAILERS : The company is providing a good margin(substantially high but yet attractive) to its retail counters, giving an edge over its competitors’ product.

UNIQUE PRODUCT : The company launched its snacks product which is quite different from what its competitors are selling.

STRONG FINANCIAL POSITION: Being a Rs.1200 crore company in India, it enjoys a strong financial reputation.

WEAKNESS

LACKS IN TASTE : Unfortunately, the product has failed to impress the masses due to its low masala content and spiciness. Therefore, the product needs a review from its R&D team.

“SPICY SOUTH” SALE IS STAGNANT : The “Spicy South” flavour is not doing good in the market as compared to its other flavours.

DISTRIBUTORS’ LACK OF INTEREST : It has been observed that the distributors are not taking much interest in the snacks item as they are considering it as an extra burden due to its space consuming cartons.

PACKAGING LOOKS SMALL : The packaging looks small as compared to the other snacks available in the market.

SHORTAGE OF STANDS : The Product’s demand is favourably high at the moment due to its intensive promotion through T.V. advertisement, but shortage of stands for big packs at the retail counters might pose a threat to its sale.

OPPORTUNITIES STAGNANT SUPPLY OF “KURKURE” : Brand “Kurkure” is one of the

major threat to the product’s sale. According to retailers the supply of “kurkure” is very stagnant at the moment, so its an opportunity for the product to increase its sales

NEEDS A SEPARATE DISTRIBUTOR : The product requires separate sole snack selling distributor due to the lack of interest of confectionary selling distributors. The distributors are demanding extra carriage cost due to its space consuming cartons. Otherwise the distributors might dump the whole snacks consignment into the wholesale markets which might affect the sale of the product and its availability in the retail market.

SMALL NET BAGS : The big packs of the product requires small net bags for the retail counters who cannot afford to buy the quantity required for the stand and also who buy in low quantities. This can increase the sale of the big packs.

REQUIRES A PRODUCT LINE : The product should be ready with a completely new set of snacks which should be improvised with more masala content and spiciness, else its brand might die.

THREATS

MARKET SHARE LEADERSHIP : The major threat to the product is from the undisputed snacks leader “Frito-lays”. We stand nowhere to its sales at the moment, but surely we can give them a tough competition in near future, if are able to improvise on our product range.

COMPETITORS SELLING EXTRA: All the major brands in the competition like Bingo, kurkure, parle, oyes are giving some percent extra in their packs resulting in large looking packaging of their product.

ADVERTISING

From “Dimaag ki batti jala de!” to Zubaan pe Lagaam!”, Perfetti has done it all. A major chunk of their funds is kept aside for advertising. Also PVM has shown creativity in its packaging as well as communications and promotions.

Keeping upto the expectations PVM came up with another impressive commercial for “Stop Not”.

However, advertising has to be backed by availability of the product, in order for the advertising to deliver the desired results and Perfetti has taken care to ensure the same.

MARKETTING MIX STRATEGY

Product Strategy

Price Strategy

Place Strategy

Promotion Strategy

PRODUCT STRATEGY

Perfetti has several mouth-watering and heavy-selling candies as a part of their Product portfolio. Launching a snacks product added one more star to their credentials.

Launched in Dec’2011, STOP NOT is a completely indigenously developed snack, inspired from the flavours of the Indian kitchen. Made hygienically, using the best raw materials, Stop Not variants have been developed by combining Indian food preferences with the most modern food processing technology.

Currently available in 4 flavors- Full Masala, Spicy South, Tangy Tomato, and Khatti Metthi.

ANALYSIS OF THE PRODUCT STRATEGY

The Major components of Perfetti’s Products, which need to be analysed are:

Design

Packaging

Quality

DESIGN Each of Perfetti’s various brands and their variants

have distinct design features. “Stop Not” comes with a face print on its packaging with different colors for each of its flavours which makes them easily identifiable among the other brands.

PACKAGING With its attractive packaging, “Stop Not” has

managed to arouse interest in the consumer market.QUALITY Perfetti focusses greatly on the quality of their

products.They have 3 ISO22000 certified manufacturing units located in Manesar, Chennai and Rudrapur.

PRICE STRATEGY

For all we know, Perfetti has been following the simplest of pricing strategies. It launched “Stop Not” in 2 price segments viz.,a 5 rupee and a 10 rupee pack, keeping in line with its competitors’.

ANALYSIS: The company has been following an

economic pricing strategy right from the starting. For “Stop Not”, it has been aiming at maximising its market share by giving comparitavely higher margin and promotional offers to the retailers as compared to its competitors.

PLACE(DISTRIBUTION) STRATEGY

Perfetti Van Melle manufacturing units in India are located in Manesar,Chennai and Rudrapur. From these the distribution is done in four regions, and has branch offices in Delhi, Mumbai, Kolkata and Bangalore to manage sales in the region.

ANALYSIS: With Distribution channels already been set

for its confectionary products, the company does not have to explore for the markets for “Stop Not”.

PROMOTION STRATEGY

To consolidate its worldwide market presence, Perfetti has always paid special attention to advertising, in terms of investments and creativity,as they both play a vital role in the creation of the product’s personality and market positioning.

The promotion strategy adopted by Perfetti for launching “Stop Not” are :

Advertising

Events and Experiences