How to create a successful brand on the Russian confectionery market? Supplemented version of 2006

Date: July 22, 2006
Pages: 153
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US$ 1,980.00
Publisher: Proriv Company
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Report type: Strategic Report
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ID: HE954B5C8CEEN
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How to create a successful brand on the Russian confectionery market? Supplemented version of 2006
Methods

In this research we used the following methods of obtaining information:

1. Depth interviews with the representatives of large and medium enterprises, the players of the Russian confectionery market, the owners of the trademarks which are well-known on the Russian market. We held interviews with the majority of enterprises owning well-known brands, as well as the representatives of several wholesale enterprises-distributors of confectionery.

2. Analysis of the information about brands on the Russian confectionery market, represented in the Internet and mass media.

3. Qualitative research. Depth interviews with the confectionery consumers. Sampling – 50 respondents. The mission of the interview is:

- To reveal the motives of choosing the trademarks of confectionery by consumers, and then to segment the consumers by this principle (in the course of further steps of the quantitative research);

- To reveal the unsatisfied demands, hidden expectations of the consumers;

- To reveal the essential singularities of perception of different groups of confectionery and brands on this market.

4. Quantitative research. Standardized interviews with the confectionery consumers (representative sampling in Russia, 800 respondents). The goals of the research are:

- To obtain the maps of perception of the trademarks which are popular on the Russian confectionery market. 17 maps of perception of nationally famous brands of confectionery have been made;

- To evaluate the size of the consumers’ segments singled out by the main motive of choice;

- To held estimation and analysis of additional motives which influence the consumer’s choice of a trademark of confectionery.

Abstract

The goal of the research is to analyze, summarize and classify the experience of Russian enterprises in the sphere of branding on the confectionery market. The outcome of the research is the matrix of marketing research and strategies of branding which are used or may be used by the producers of confectionery on the Russian market. Thus, any enterprise after making the analysis of the contents of the present research can choose a suitable marketing or branding strategy, taking in account the particular features of its development, recourses and characteristics of expectations of confectionery consumers.

Mistakes which have been already made by the Russian confectioners in developing brands, as well as the reasons of their success and achievements are the material which will be the most effective way to help you in creating the effective strategy for your enterprise. This kind of material is offered in the present report.

In the basis of the research are depth interviews with the representatives of the enterprises which own brands which are successful on the Russian market.

The leading Russian producers of confectionery, such as United Bakers, «SladCo», Chipita International, Confectionery and Baking Factory «Cheryomushki», MBKK «Kolomenskoe», «Russkij Biscuit», «Khlebnyj Dom», «Ramenskij Konditerskij Kombinat», «Lakom», «Makharishi Products», «Lubimyj Kraj», KelsenBiska and dozens of other well-known players of the market gave exclusive interviews to the experts of Proryv company. In these interviews they shared their secrets and gave the insight into the strategies of marketing and branding which they use. We held interviews with more than 50 largest enterprises of the industry.

This report also includes the maps of perception of 17 brands of confectionery which are popular on the Russian market. Detailed analysis of their success and failures is given, and their prospects and opportunities are described. On the basis of the analysis new market opportunities of the existing trademarks are described, as well as opportunities of creating new brands with the orientation towards unsatisfied expectations of the consumers.

The summary of the results of the research begins with the description of tendencies of development of the Russian confectionery market and considering the role of branding in the market developing and success of chosen enterprises on the given market.

Further we describe the market situation within the major segments of the Russian confectionery market.

We analyze the particulars of the competitive environment on confectionery market, in particular, and between Russian and foreign enterprises. We present a brief description of the major players on the confectionery market.

The report indicates all the facts of large investments of foreign companies in Russian enterprises (that is, all large purchases of foreign companies on the Russian market).

Further we give the details on the formed particulars of branding on the Russian market. Among the details we can mention such characteristics as “high competition among product groups”, “absence of rigid positioning and understanding of its target group with the majority of producers”, “creating of new products, brands usually happens without considering expectations of the end consumer”. Each of these features is being proved and discussed. We also supply extracts of Depth interviews with the representatives of the companies to support these ideas.

Then we consider the prejudices formed in the sphere of branding.

Then we offer detailed description and classification of marketing and branding strategies used at present. The strategies are analyzed on the basis of examples of existing products and brands of confectionery.

Separately we discuss the potentially effective strategies not used at present, which are discovered by the experts of our company. These strategies are based on the market possibilities found in the process of this research.

Further we present the segmentation of the consumers by the motive of choice of the trademark of confectionery and analyze the typical marketing strategies which aim to satisfy the demands of each of the segments shown previously.

The strategies of developing of well-known Russian trademarks are analyzed from the point of view of the expectations of the segments of buyers. These expectations are singled out by the motives of the choice of the trademark. The conclusions are supported by the quotes from the depth interviews of the representatives of enterprises – authors of trademarks, as well as maps of perception by the direct consumers (obtained as a result of interviews with consumers).

Further we give the detailed insight into the perception by the consumers of 17 most popular Russian trademarks of confectionery.

In conclusion we offer the ratings of awareness, consumption and the quotient of attractiveness of the trademarks of confectionery under study (the later indicator has not been used previously; it was formulated by the experts of Proryv company).

Introduction

Part 1. Major tendencies of the development of the Russian confectionery market.

I. The development of the Russian confectionery market

II. The particular features of the Russian confectionery market

III. The capacity and structure of the Russian confectionery market

The segment of cookies

The segment of waffle products

The segment of waffle cakes

The segment of cakes and Swiss rolls

IV. The major players of the market

JSC "Bolshevik"

«United Bakers»

JSC «The Cofectionery and pasty factory «Cheryomushki»

JSC «Pekar’»

JSC «Khlebnyj Dom»

«The Confectionery Corporation «SladKo»

CSC «Russkij Biscuit»

LLC "Sunny Cake Baking "

CSC «Chipita Trading»

CSC "Confectionery factory named after K. Samoilova"

SUE Moscow foodstuff combinate «Cracker»

JSC "Rot-Front"

JSC "Confectionery company "Altaj"

JSC «Tomskij konditer»

JSC «Bryankonfi»

JSC «Bakery and confectionery factory «Kolomenskoe»

«Uniservice» Group of companies

«Lakom» Group

Confectionery House «Vostok»

Foreign companies on the Russian confectionery market

Part 2. Marketing strategies of confectionery producers on the Russian market.

I. Particular features of branding on the confectionery market.

II. Prejudices in the sphere of branding

III. Marketing and branding strategies

1. «Differentiate or die» - search and creating of new segments of the market.

2. «Acclimatization» on the Russian market of the ideas of products which already exist in Europe.

3. Concentration of efforts on brand creating in the particular product category which has previously been filled only by products without trademarks.

4. Creating the low-price analog of the leading trademark.

5. Focusing upon a single segment of the market

6. Usage of the formed segment of the trademark on neighboring markets to enter the confectionery market.

7. Choosing the unoccupied price or product niche.

8. Attracting attention of the buyer due to the lower price at acceptable quality (correlation price-quality).

9. Promoting the brand by extensive investments in advertising.

10. Using the traditional names which are known to the consumer for a long time, which the consumer, naturally, remains loyal to.

11. Attracting the customers’ attention due to the original taste additives.

12. Attracting the consumers’ attention by patriotic theme (first of all in the names).

13. Constant renewal of the assortment in order to find new tastes which are interesting to the consumers.

14. Creating «light» confectionery products «for women».

15. Positioning based on the situation with the consumption.

16. The brands which have already «exhausted» themselves in Russia can be exported to the countries of CIS, where the level of market development and the income level of the population, as a rule, leg behind Russia.

17. The accent in occupying the market in the regions other than Moscow, because the expenses on “entry” to the market and promotion of goods in retail chains are extremely high.

18. Tumen «Choko-pie».

19. Positioning of a trademark of confectionery based on the behavioral particularities, values, the motives of choice, which are characteristic for the target groups of the consumers.

Part 3. Effective branding strategies on the Russian confectionery market.

I. The strategies of brand developing, oriented on the “experimenting” and “original” consumers.

II. The strategies of brand developing, oriented on the “suspicious” and “nostalgic” consumers.

III. The strategies of brand developing, oriented on the “conservative” consumers.

IV. The strategies of brand developing, oriented on the “gourmet” consumers..

V. The strategies of brand developing, oriented on the “naturalist” consumers.

VI. The strategies of brand developing, oriented on the “rationalist” consumers.

VII. The strategies of brand developing, oriented on the consumers “loving fresh stuff”.

VIII. The strategies of brand developing, oriented on the “prestige-oriented” consumers.

IX. The strategies of brand developing, oriented on the “calories conscious” consumers.

Part 4. The most famous Russian brands of confectionery as seen by consumers.

«Yubilejnoe»

«Prichuda»

«7 days»

«Kolomenskoe»

«Tornado»

«Dan Cake»

«Zvezdnyj»

«Prince»

«Cheryomushki» and «Charodejka»

«SladKo»

«Russkaja Niva»

«Russkij Biscuit»

«Orion Choco-Pie»

«Pekar’»

«Khlebnyj Dom»

«KelsenBiska»

Supplement 1. Acknowledgement and consumption of major trademarks of confectionery

The list of Charts

Chart 1. The structure of the confectionery market in Russia.

Chart 2. The composition of Russian confectionery market.

Chart 3. Shares of the confectionery sold by weight as compared with packed confectionery on the Russian market.

Chart 4. The preferences of trademarks of Swiss rolls and cakes in percentage of the total quantity of the consumers of Swiss rolls and cakes.

Chart 5. The rating of brands most often consumed at work.

Chart 6. The motives influencing the choice of trademark by the “experimenting” consumers.

Chart 7. The motives influencing the choice of trademark by the “original” consumers.

Chart 8. The estimation by the consumers the value «novelty, diversity of tastes in the product range» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 9. The estimation by the consumers the value «originality» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 10. The age composition of the "experimenting" consumers in comparison with the sampling values.

Chart 11. The motives influencing the choice of trademark by the “suspicious” consumers.

Chart 12. The motives influencing the choice of trademark by the “nostalgic” consumers.

Chart 13. The estimation by the consumers the value «reliability» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 14. The estimation by the consumers the value «nostalgia» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 15. The age composition of the "suspicious" consumers in comparison with the sampling values.

Chart 16. The motives influencing the choice of trademark by the “conservative” consumers.

Chart 17. The estimation by the consumers the value «customarity» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 18. Motives which influence the choice of the trademark by “gourmet” consumers.

Chart 19. The estimation by the consumers the value «good taste qualities» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 20. The motives influencing the choice of trademark by the “naturalist” consumers.

Chart 21. The estimation by the consumers the value «naturalness» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 22. The motives influencing the choice of trademark by the “rational” consumers.

Chart 23. The estimation by the consumers the value «economy» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 24. The motives influencing the choice of trademark by the “rational” consumers.

Chart 25. The estimation by the consumers the value «freshness» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 26. The age composition of the consumers "loving fresh stuff" in comparison with the sampling values.

Chart 27. The estimation by the consumers the value «prestige» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 28. The motives influencing the choice of trademark by the “prestige-oriented” consumers.

Chart 29. The estimation by the consumers the value «low calories» in the most well-known trademarks of confectionery (average evaluation by 5-point scale).

Chart 30. Estimation of the major values in the brand «Yubilejnoe» by the consumers (average evaluation by 5-point scale).

Chart 31. Estimation of the major values in the brand « Prichuda» by the consumers (average evaluation by 5-point scale).

Chart 32. Estimation of the major values in the brand «7 days» by the consumers (average evaluation by 5-point scale).

Chart 33. The rating of brands, most often consumed “on the way” and purchased “to consume while traveling”.

Chart 34. Estimation of the major values in the brand «Kolomenskoe» by the consumers (average evaluation by 5-point scale).

Chart 35. Estimation of the major values in the brand «Tornado» by the consumers (average evaluation by 5-point scale).

Chart 36. Estimation of the major values in the brand «Dan Cake» by the consumers (average evaluation by 5-point scale).

Chart 37. Estimation of the major values in the brand « Zvezdnyj » by the consumers (average evaluation by 5-point scale).

Chart 38. Estimation of the major values in the brand «Prince» by the consumers (average evaluation by 5-point scale).

Chart 39. Estimation of the major values in the brand «Charodejka» by the consumers (average evaluation by 5-point scale).

Chart 40. Estimation of the major values in the brand «Cheryomushki» by the consumers (average evaluation by 5-point scale).

Chart 41. Estimation of the major values in the brand «SladKo» by the consumers (average evaluation by 5-point scale).

Chart 42. Estimation of the major values in the brand «Russkaja Niva» by the consumers (average evaluation by 5-point scale).

Chart 43. Estimation of the major values in the brand «Russkij Biscuit» by the consumers (average evaluation by 5-point scale).

Chart 44. Estimation of the major values in the brand «Orion Choco-Pie» by the consumers (average evaluation by 5-point scale).

Chart 45. Estimation of the major values in the brand «Pekar’» by the consumers (average evaluation by 5-point scale).

Chart 46. Estimation of the major values in the brand «Khlebnyj Dom» by the consumers (average evaluation by 5-point scale).

Chart 47. Estimation of the major values in the brand «KelsenBiska» by the consumers (average evaluation by 5-point scale).

The list of tables

Table 1. Awareness and consumption of different makes of shortbread by the consumers of shortbread in rating scale.

Table 2. The rating of producers of waffles sold by weight (market share in natural value).

Table 3. The rating of producers of packed waffles (market share in natural value).

Table 4. Knowledge and consumption of different makes of waffles by the consumers of waffles in rating scale.

Table 5. The rating of producers of waffle cakes (market share in natural value).

Table 6. Foregn investments in the confectionery market.

Table 7. Segmenting the confectionery consumers by the main motive of choice.

Table 8. Description of the segments of “experimenting” and “original” consumers.

Table 9. Description of the segments of “suspicious” and “nostalgic” consumers.

Table 10. Description of the segment of “conservative” consumers.

Table 11. Description of the segment of “gourmet” consumers.

Table 12. Description of the segment of “naturalist” consumers.

Table 13. Description of the segment of “rational” consumers.

Table 14. Description of the segment of consumers “loving fresh stuff”.

Table 15. Description of the segment of “prestige oriented” consumers.

Table 16. Description of the segment of “calories conscious” consumers.

Table 17. Perception of tasting qualities of waffle cakes «Prichuda», «Chokoladnitsa» and «Zvezdnyj» by three main characteristics which are the most significant for the consumers.

Table 18. The summary rating by the perception of tasting qualities of waffle cakes «Prichuda», «Chokoladnitsa» and «Zvezdnyj» by the consumers.

Table 19. The rating of brands by the awareness, the number of consumers knowing it and consuming it in per cent of the total number of confectionery consumers.

Table 20. The rating of brands by consumption, the number of consumers knowing it and consuming it in per cent to the total number of confectionery consumers.

Table 21. The rating of brands by the quotient of attractiveness.

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