Confectionery sales for 2016 were clearly above the prior year in nearly all units. Fazer grew its market share in all key customers in Finland, with tablets performing exceptionally well.
While strong position in Finland is a great asset, the geographical concentration is also a risk, as Finland makes up a large share of the sales. Stronger presence in nearby markets as well as entry to completely new markets will reduce the risk.
In Sweden, bottom line performance improved significantly and net sales grew. In Russia, the focus in 2016 was on improving profitability. The Baltics and international exports saw good results stemming from an increased focus on profitability.
Despite fierce competition with international companies, Fazer has been able to defend and improve its position in Finland. In sugar confectionery, the market dynamic has shifted with consumers increasingly looking for pick and mix products to fulfil their needs. The withdrawal of the Finnish excise duty in the beginning of 2017 is a positive step, as the duty has had a distorting effect on competition. In Sweden, further increase of sales is sought in 2017 and beyond with a growth programme involving a refreshed chocolate strategy and stronger participation in the sugar confectionery market. Fazer Confectionery’s renewed portfolio strategy has a strong focus on chocolate. The success of tablets under the Karl Fazer flagship brand, as well as that of the new innovative Karl Fazer Travel series launched at the beginning of the year, show that the strategy is working well. The portfolio strategy is supported by the development of new design, digital and shopper capabilities.
The development of content marketing in Fazer’s channels increases customer interaction. Fazer Confectionery organised four Facebook Live broadcasts, presenting its professionalism and Finnish production in a concrete and modern way.
“This year proved that we have chosen the right strategic goals, and we will continue to focus on them in the future. What I am most proud of at Fazer Confectionery is our team. When we work together as a team with a common goal, we get results,” says Rolf Ladau, Managing Director of Fazer Confectionery.
Return of the biscuit
2016 saw the homecoming of three beloved biscuit brands – Domino, Jaffa and Fanipala (originally Fasupala), all originally launched by Fazer. With the acquisition, Fazer rose to a leading position in the Finnish biscuit market. As the market leader, Fazer will focus on developing the category and bringing new and exciting novelties to boost consumer interest towards biscuits.
Beloved brand wins again
Karl Fazer Milk Chocolate was the most esteemed Finnish brand in 2016. The iconic brand was voted number one for the eighth time in a row – with the overall Fazer brand taking silver and securing a double victory. This achievement reflects the cherished position Fazer and its chocolates have reached in the hearts of the Finns.
Redesigned packaging stands out
Fazer Confectionery invested strongly in packaging design in 2016, refreshing the look of familiar products such as the Fazer Marianne and Tutti Frutti sugar bags and creating striking designs for new products such as Karl Fazer Berry Pearls. A clearer, simpler and more attractive direction has proved successful, with the new packages sparking interest among consumers. The design renewal will continue in 2017.
Fazer works closely with customers to improve the shopping experience at store level, helping make the confectionery aisle easier to navigate and more inspirational, leading to improved sales. Several pilot projects took place in 2016 and this work is set to continue in 2017.
Responsible cocoa at the core
Responsible cocoa production is vital for the future of manufacturing chocolate. This is why Fazer is doing its best to improve the availability of its most important raw material and the livelihoods of cocoa farmers. Fazer sources cocoa through direct programmes as well as certified cocoa through UTZ, Rainforest Alliance and the Fairtrade Cocoa Programme.
Only a fifth of the world’s cocoa farmers are currently certified. Up to four-fifths of farmers do not belong to any certification system, and it is those farmers who need support to advance responsible cocoa cultivation.
Through direct farmer programmes, Fazer supports those farmers who are most in need of help. In 2016, the share of responsible cocoa in Fazer’s products was 85 per cent. From the beginning of 2017, the company is able to trace the origin of all the cocoa it uses, and its cocoa supply chain meets the criteria for responsible production.