Big Plans For Ferrero In India: Pelle

Ever wondered why your kid loves the popular confectionary-Kinder toys, an extensive research goes into developing the top-selling chocolate-confectionary product-Kinder Joy, that is now Ferrero India’s biggest product in India. Research shows that the tiny toys packed inside are designed to develop cognitive, emotional, relational, and motor skills. 

The findings were stated in Ferrero Group’s Corporate Social Responsibility (CSR) Report 2018 that was launched in Delhi. The Kinder Surprise Company (KSC) is a division of the Ferrero Group, dedicated to making surprise toys with the collaboration of psychologists. “A lot of money goes into research and development of these products,” says Ferrero India managing director, Stefano Pelle who was in Delhi for the launch.  

India is now Ferrero Group’s second-biggest manufacturer of toys after China, and it’s closing the gap. Ferrero India makes 900 million toys, of which 270 million are used for domestic consumption and the rest are exported, either as part of Kinder Joy packs or as toys. 

On the advertising and marketing front too, the Italian company is now targeting mothers in its ad campaigns for Kinder Joy rather than its main target audience- children. “It wasn’t an easy decision for us as the cost of advertising, media planning went up by 20-30% but we went for it,” said Pelle.

Talking about the report, Pelle said the company goes overboard in its CSR spent each year by spending over government’s mandatory spent of 2% out of company’s net profits as it stands committed by the group’s respect for people and planet. He said the groups’ goals for 2020 has almost been accomplished with its usage of 100% sustainable raw materials used. It has zero water wastage, it’s carbon dioxide footprint has been reduced. 

The Italian firm, which is 12-billion euros in revenues, has only one manufacturing unit in India in Baramati, Maharashtra, which has the largest solar plant roof but it has some exclusive vendors in the country who manufacture toys only for Ferrero. It caters to both domestic and exports in the ratio 50:50 out of its total manufacturing.
 
The Italian firm, which sells chocolates, bakery products, snacks, spreads, mints and drinks across over 170 countries, has begun testing entry-level confectionery brands in India as it looks to broadbase its portfolio and step up share in an intensely competitive market. “India is a growing and very important market with big scope for category penetration,” Pelle said. “Consumption of chocolates and confectionery is turning more frequent,” he added.
 
On the investment front, Pelle revealed that the company will invest another Rs 500 crore to take its total investment to Rs 2,000 crore in India by 2020, as part of plans to expand its production facility and distribution network, said Pelle. He said the company is also expanding its distribution network and plans to be available in top 100 cities soon, and to double our distribution in next 2-3 years.

The company also plans to import or manufacture locally its other brands of chocolates which they sell globally this year, Pelle revealed.