Weakening „B” brands among pralines

Preparations are on the way for the long praline season, which will reach its peak around Christmas. Private labels hold stronger positions than ever before, but premium products are also strong, being the preferred choice to serve as gifts. The praline segment is still among the most dynamically developing areas in the sweets business. Private labels account for most of the growth in the segment. Manufacturers of traditional brands are forced to use their resources for defending their positions, which means this is not the time for innovation. Strong brands however, have reason to be optimistic about the future. As they are defending their positions successfully, private labels of discount chains are displacing “B” category brands, which do not enjoy much marketing support. – The strength of traditional brands is apparent during seasons when gifts are bought, like at the end of the year – says Erika Baráth, brand manager of Bonbonetti Kft. – In Hungary, pralines are bought primarily to be given away as gifts, which is good for brands – she adds. Own data from Storck Hungária Kft. seems to confirm this statement and throws light on an interesting phenomenon. Demand is growing for premium category desserts in exclusive packaging and large sizes. – 400 gram and 675 gram Merci pralines account for an increasing part of our total sales. Demand for these sizes is growing faster than for the 250 gram size and this trend is not confined to Christmas or Easter time – comments Andrea Gémes, trade marketing manager. The three major categories in the praline market are mono desserts, mixed pralines and alcoholic desserts. The latter is the smallest and has been shrinking for years. Not much activity has been seen lately among alcoholic desserts, but Bonbonetti had been working on repositioning its market leading brand, Cherry Queen which will receive substantial marketing support in the autumn in the hope of boosting sales again. As pralines are usually bought to be given away as gifts, attractive packaging is extremely important. – Communication also plays a crucial role, as a gift is a statement about the relationship between two people – says Erika Baráth. In addition to Christmas and Easter, manufacturers are working on creating new seasons like Halloween or the beginning of school. 2006 was the most successful year for Storck Hungária Kft. so far, with net revenues exceeding HUF 2,2 billion. The two dominant companies in the segment follow different sales strategies. While Bonbonetti is present is several price categories, Storck Hungária Kft. focuses on mono brands, selling only one product under a specific name.