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Gifts and share packs prompt Nestle travel launches

By Caroline Scott-Thomas , 20-Nov-2008

Nestle International Travel Retail (NITR) is concentrating on expanding its range of confectionery and increase the frequency of its product launches in order to profit from its fastest-growing product sectors.

NITR plans to implement its new strategy particularly in ‘informal gifting’ and ‘sharing’, which it says represent 50 and 23 per cent of its confectionery sales respectively.

NITR spokesperson Nina Backes told ConfectioneryNews.com that the company was taking this approach because “informal gifting and sharing packs are showing significant growth in the travel retail market.”

For the period January to September 2008, both sectors were up 19 per cent on the same period last year.

The growth in these categories is a shift from 2007, however, when the company said that its ‘destination and souvenirs’ category was the fastest-growing. The categories are at different ends of the price spectrum, with NITR’s informal gifting and sharing ranges representing the less-expensive end of its product range, and it is no secret that customers may have less to spend this year.

The company has previously said that it wishes to double its sales revenue from 2003 levels to $2.6bn by the end of 2009 and now it hopes that focussing on product launches in its most successful categories will help to achieve this.

NITR is launching three new products in March 2009 in the ‘informal gifting’ category: giant pralines, a ‘tower’ of assorted chocolates and a flat pack of chocolate squares, while it is also launching Nesquik chocolates and After Eights in large sharing packs.

Backes said: Travel retail covers all goods that can be sold to passengers on the move, usually in airports, inflight, on ferries and cruiseships, at border shops, and at downtown duty free stores…Overall, confectionery in travel retail represents around 7% of the global market.”

This market also includes beauty products, tobacco and beverages, and although confectionery is a relatively low-value part of the travel retail sector, according to market research by travel retail specialists Generation Research, confectionery revenue still outstrips alcohol, but it remains in fourth place behind women’s fragrance, cosmetics and tobacco.

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