The featherweight match is underway – Trade magazin

The article is from Trade magazine 2024/5. can be read in its issue.

EAfter a difficult year, most food categories can look forward to this year with justified optimism. However, the changing situation of the economy, the weakening of the forint and the further rise in the prices of raw materials – primarily grain and cocoa – may present another challenge to the cereal market.

– In terms of sales, the biggest challenge is the increased prices and the accompanying increased price sensitivity – says Viktória Márkus-Mangov, Nestlé Hungária Kft.. brand manager. – It is typical for consumers to actively monitor prices and monitor the unit price of products. Price promotions play a significant role in the customer’s decision-making process, to which we respond with a targeted promotional strategy. In addition to the price increase, shrinkflation also appeared: the mechanism of switching to smaller product sizes and packaging. Thus, consumers can now rethink their purchase decisions not only due to changes in prices, but also due to product size changes.

Pricing and promotion played a leading role

– Manufacturers and retailers are forced to adapt to the changed market conditions and the price and value sensitivity shown by customers in terms of pricing, product strategy and promotions in order to maintain or increase their market share – emphasizes Tamás Bozó, GOF Hungary Kft.. sales manager.

In such a situation, consumers may be inclined to switch to cheaper cereals with fewer ingredients, from premium or branded products to lower-priced brands or private label products.. At the same time, a lot also depends on the market players.

– Manufacturers and retailers can use different pricing strategies in price positioning and promotions in order to meet changes in consumer demand – points out Tamás Bozó. – They can try price reductions, promotions or coupons to make their products more attractive to customers. Another strategy is to promote private label products. These can generally represent alternatives offered at a more favorable price for consumers.

Currently, the slowdown in inflation and the increase in purchasing power have a positive effect on the food industry, including cereals. According to Tamás Bozó, the key to success now will be competitive price, quality and innovation.

The slices held up better

At Cerbona, they see that with certain products, such as specially functional cereals, as well as new listings, it was possible to achieve results even in these difficult market conditions.

– In the category of breakfast products, customers either consume less or other types of products, so we saw a bigger decline there – Anna Pókecz, Cerbona Élélmiszergyártó Zrt, looks back. marketing manager. – However, we did not notice any major changes in sliced ​​products.

Several manufacturers on the market have raised prices or reduced product weight in order to remain competitive.

– For years, we have seen that the sales volume of private label products is increasing. This is not surprising, since customers can now get good quality at a more favorable price. Thus, in addition to an aggressive promotional strategy, strong brand communication is also necessary on the part of the manufacturers – Anna Pókecz mentions.

Cereals that open up new possibilities are arriving

– The new products planned for this year in Nestlé’s cereal business can create opportunities for growth, so we are prepared and excited for the coming months – Viktória Márkus-Mangov looks ahead optimistically.

The company had several exciting product launches last year. High-fiber or protein-enriched bars are increasingly in demand – in response to this, two new cereal bars were released. The honey-flavored Fitness cereal bar with sweetener sprinkled with white chocolate has a high fiber content, and the chocolate-decorated, cocoa-flavored Fitness cereal bar with sweetener is also an excellent source of protein..

Their prominent product launch last year was the KitKat cereal, which was a great success among consumers: in half a year, the 4. became the most popular brand among cereal flakes in Hungary (NIQ, 2023. 3. quarter). In addition, within the portfolio of Nestlé’s cereal business, it also took first place at the product level, and is currently able to maintain its position.

– In April of this year, our new cereal innovations will arrive on store shelves, the new Nestlé Minis products, which are reimagined versions of our cereal in the form of small balls – reports Nestlé Hungária Kft.. brand manager. – This new Minis form provides new consumption options for customers, as they can also try it with yogurt or herbal drink. We are also planning an introduction for the second half of the year: we are launching a completely new cereal brand that has already proven itself on foreign markets, and we are confident that it will become a popular brand on the domestic market as well.

As every year, consumers can regularly meet their TV, online and social media campaigns this year as well.

– We are also preparing exciting solutions in terms of trade activities in 2024 – reveals Viktória Márkus-Mangov. – Customers can also find different store decorations in the stores. A good example of this is the in-store and out-of-home support of our KitKat cereal launch last year, where we tried to establish the success of the product launch with an integrated communication campaign.

They are based on successful segments

GOF Hungary Kft. is building on the recent success of granola and ball-based products.than.

– The demand for granola is expected to continue to grow, which is why we are trying to introduce new flavors, textures and formats. Ball-based products are also becoming more and more popular, of which we would like to be prominent representatives in Hungary – states Tamás Bozó. – Considering the needs of the market, at the end of last year we introduced our 3 gluten-free granola products, the raw material of which is of course the oats we produce. In the future, it is expected that more of our new products will appear on the market in the name of health, comfort and sustainability.

In the current market situation, it has become particularly important for brands to effectively reach their target audience, so the company also deals a lot with rethinking marketing communication.

– The online presence is extremely important in reaching consumers – states the sales manager. – We try to promote our products in as many places as possible. Social media plays an important role in this, we help our consumers to make the right decision with our products. Education is also important. With blog posts, recipes and videos, we arouse the interest of our consumers and inform them about the benefits of a gluten-free diet.

A nationwide campaign was launched in the spring. His message, according to which “We have more in common than you think”, was displayed on citylights, in newspapers and online. They also organize tastings to get to know their products.

– Our important task is community building and conveying that gluten-free eating is an opportunity, not a limitation, and that the inclusion of oat products in our diet can be the basis of a vegan and sporty life – says Tamás Bozó.

They keep up with both products and marketing

According to Cerbona, innovation is also essential in this sector.

– Our granola products, for example, specifically require a lot of development, but they also have many product advantages, which we adapted to market expectations – says Anna Pókecz. – You have to keep up with trends and consumer needs. The latest proof of this is our latest, recently successfully launched cereal product for children.

They try to reach their consumers from all sides. It is particularly important for them to support their new product launches both online and offline.

– We pay great attention to online communication and achieve good results – Cerbona’s marketing manager informs our newspaper. – However, we also place special emphasis on our trade activities, since local sales marketing is essential in this market environment. Our vision is stable, but we are constantly adapting the details of our plan to market changes. //