“We are a smaller player in the categories we play in,” Vice President of Sales John Kennington explains. “If you look at spreads – and we count that as jams, jellies and peanut butter – it’s close to a $2 billion industry. With Nutella the brand is north of $250 million in retail sales and in single-digit percent share with two SKUs. In chocolate, it’s the same where we’re competing against Ghirardelli and Hershey’s. Even in mints, we are big in the mint category with our Tic Tac brand, but no retailer looks at just mints. They look at gum, mints and other sugar candies, so we’re smaller in that category as well. But being smaller means we have to work harder and smarter, and we’ve built the right teams behind each of these brands because of that.”
Finding Their Places
Take the Tic Tac® brand for instance. It’s managed to rise to pop-culture, icon status through constant reinvention – evolving with each generation, yet retaining a sense of nostalgia. Requests to incorporate Tic Tac mints in essential story lines of major motion pictures, television shows and even television game shows solidify the brand’s “cool” factor.
Nutella® hazelnut spread, meanwhile, has a distinctive taste that people love. The combination of roasted hazelnuts, skim milk and a hint of cocoa sans artificial colors or preservatives serves as a vehicle for families to create an easy and tasty breakfast.
Ferrero Rocher® hazelnut chocolates have garnered a reputation as an affordable indulgence. Its product architecture is quite unique: a whole hazelnut wrapped inside a dollop of Nutella, which is surrounded by a delicate, crisp, round wafer enrobed with milk chocolate and sprinkled with finely-chopped hazelnuts, with each ball individually-wrapped in gold foil. It’s a little indulgence for oneself but a great gift for others. In fact, employees at the company jest that you know it’s Christmas when the Ferrero Rocher displays go up.
The atmosphere surrounding each brand feels natural – as if it just fell into place. But Kennington explains that each one is in fact artfully tailored to its individual market.
“Our team understands how to match the product to the marketplace to be successful,” he says. “For instance, I was amazed when someone told me that Nutella hazelnut spread has been in the U.S. for 30 years. At one time, it was very hard to find even in specialty stores. Now, you can find it anywhere and everywhere, and it has to do with the company reinforcing what the product is, teaching consumers when and how to use it, and increasing distribution in all channels.”
Where Are They Now?
These well-defined brands, however, are still dynamic in nature. As markets change, the brands change along with them making sure they are meeting the needs of today’s consumers.
For the Tic Tac brand that means coming out with new flavors and new packaging formats, like the Jumbo Pack that holds 200 mints, which was launched in 2012.
It is not just the product and packaging that reach today’s consumers, but the brand’s advertising and communication vehicles are also key elements to engage people. Last year, the Tic Tac brand had a three-billboard display in Times Square, a famed destination for millions of people, that allowed for consumers to interact with the brand on the billboards. The billboards were part of its Shake It Up® campaign that takes the brand beyond physical locations and into the world of social media and viral campaigns.
The campaign embraced augmented reality with a free mobile app for iOS and Android, which urged users to take a break from the mundane and shake things up a bit. By scanning a Tic Tac box, users were able to unlock games receive daily tips on how to keep oneself entertained.
“The Tic Tac brand has been about evolving into other outlets where consumers can be found,” Kennington says. “We’ve done some fun things with our Shake It Up® campaign and augmented reality games. We’re being innovative in our methods of addressing the consumer and getting products to the consumers.”
Similar to the Tic Tac brand, the Nutella® brand has also embraced the on-the-go lifestyle of consumers, but in a different manner. Last year the company launched Nutella & Go – a 1.8 oz. portion of Nutella with breadsticks for dipping.
“You can take the product out and eat it right there, and it’s been doing phenomenally well,” Kennington says.
Like its sister brands, the Ferrero Rocher® brand has a distinct message that the brand team continues to drive home. Combined with other Ferrero confectionery products, like Rondnoir® fine dark chocolates and Raffaello® almond coconut confections, the gifting nature of chocolate and confectionery makes it a hit for holidays such as Valentine’s Day, Easter and Christmas. However, compared to its European counterparts, Ferrero Rocher’s holiday coming-out party in the United States pales in comparison to those of its European counterparts, Kennington says.
“I started here eight years ago, and the month after I started, my boss told me I needed to go to Europe to see the future,” Kennington says.
“It was right before Christmas, and what he was saying was go see how the European marketplace establishes its products in the theater of Christmas. The U.S. does something similar but on a smaller scale. Our products go in the seasonal aisle, which is not in a prominent location. In Europe, you know it’s Christmas. There are lights and displays everywhere. And Ferrero’s products are featured along with others. There is a huge opportunity for confectionery and chocolate companies to work with retailers to build the theater of Christmas here in the U.S.”