Duc d’O eyes growth in Russia and China with authenticity as ‘bling-bling’ era dies
Luuk Reijnders, global business director of Duc d’O, told ConfectioneryNews.com: “The Chinese and Russian bling bling need is over. Consumers now chose more authentic and all-natural products and we fit into this trend”.
He said that consumers in China and Russia were previously drawn to flashy brands like Dolce & Gabanna, but now wanted homemade, artisanal products.
New look brand
Chocolatier Duc d’O was established in 1983 and was acquired by fellow Belgian firm Gudrun in June 2011.
Shortly after the company was taken over, it conducted market research to renew its brand, which had not been updated in 10 years.
The company found consumers viewed the product as artisanal and handmade rather than an industrialy produced truffle.
Duc d’O’s truffles are not hand rolled, but are packaged by hand and it has sought to communicate the artisanal feel of the brand through its new packaging.
Asia: China and Korea prospects
The company see growth opportunities in both Asia and Eastern Europe.
“In Asia, we see a strong development of the chocolate category. The penetration and frequency of chocolate is increasing,” said Reijnders.
“China is the most promising and fastest growing, but also the most difficult.”
He said that China was a big and ultra-competitive market, but was confident his firm could grow there. Duc d’O is sold in Carrefour in China and also in travel retail, including airports and train stations.
Reijnders added that South Korea was another attractive market. Duc d’O is sold in a large bakery retail chain in South Korea, which has helped it to grow, particularly around Valentine’s Day and White Day.
He said that bakery was “a channel that allows premium products and premium pricing”.
Russia and Eastern Europe
In Eastern Europe, Duc d’O is present in Russia, Ukraine, Czech Republic and Slovakia.
“What we see in Eastern Europe is that Russia is the biggest market, but also not the easiest to tap,” said Reijnders.
He said the retail infrastructure was underdeveloped and market entry, through listing fees and promotional spends, was expensive.
Sales and channels
The Duc d’O Gudrun Group has an annual turnover of around €60m ($78.3).
Duc d’O claims to be the largest producer of flaked chocolate truffles in the world and has two divisions: Gifting and branding.
The gifting division supplies products to high-end private label customers such as Marks & Spencer in the UK, while the branding division sells Duc d’O in mainstream retailers such as Asda and Carrefour.
Around 40% of volumes from the company’s branded division are sold in Europe, 30% in Asia and 20% in the rest of the world.
Products are manufactured from two plants in Belgium.