Interview: Nikhil Sharma, Managing Director, Perfetti Van Melle India

Perfetti Van Melle has been in India for three decades, and most consumer categories have pivoted towards premiumisation. What has been your strategy and experience?

Perfetti’s premiumisation journey in India has been a transformative one. In 2018 we did a comprehensive demand-space study that identified untapped opportunities. This study bolstered our conviction that Indian consumers are increasingly receptive to premium offerings. In the seven years since, we have made significant strides in premiumising our portfolio. From the non-`1 price points constituting merely 5% of our portfolio to today at 30%. While we are happy with this achievement, this is just the beginning; our ambitions stretch far beyond.

At the heart of our premiumisation strategy lies product innovation. For consumers to embrace premium offerings, the products must deliver an experience that justifies the higher price point. To that end, we continuously experiment with new formats and pricing structures.

The NielsenIQ report mentions that premium-plus segments now account for around 27% of total FMCG sales and contribute 42% of the sector’s value growth. Premium FMCG is growing faster through distinct value offers in the form of elevated experience, specialised benefits or more convenience. We too have adopted premiumisation across portfolio — our mono price point at 2, impulse products like jelly packs at10, and then high value packs of 50 and at100.

Beyond innovation, accessibility remains key. Our distribution network — we directly cover 12 lakh stores — ensures that these premium products reach consumers seamlessly.

Prices of raw materials have gone up sharply. How were you able to maintain the popular price point of `2?

Navigating inflationary pressures especially as we are burdened by use as a proxy for small denomination change and non-sticky price points have been especially tough. We have looked at this both as a challenge and an opportunity. Productivity enhancements across our operations help us drive efficiencies, ensuring that we absorb cost fluctuations while keeping our products accessible to all. There are revenue growth strategies that our teams have put together to work more efficiently with our external partners like distributors and retailers.

The confectionery category depends a lot on promotions. We haven’t seen Perfetti leverage properties like IPL.
There was a time when consumer promotions ruled the roots in our category, but we have seen that of late, there is a case of diminishing returns. Having said that, when the right opportunity presents itself, we will avail of it. Trade promos on the other hand remain relevant. Our approach to communication is rooted in the unique nature of the confectionery category — one that thrives on impulse. We focus on creating unforgettable brand moments born from a smarter, creative thought that stay with consumers long after they encounter them. An example is Centerfruit with a TVC launch with full surround support at Maha Kumbh and an activation in Delhi Metro. Our media strategy therefore is to maximise time on air and focus on getting the viewer’s attention.

Food fortification is a growing consumer concern. What sort of innovation is Perfetti pushing for?

While traditional indulgence remains popular, there is a noticeable rise in demand for products with functional benefits, such as sugar-free, low-calorie, or fortified snacks. We were one of the first to introduce sugar-free options in sugar-free chewing gum and breath mints under our brands Mentos, Happydent, and Center Fresh. Our recently launched AJJ Jungle Land and Fruity Salad jellies come with the goodness of fruit juice in flavours like strawberry, orange, green apple, pineapple, banana and orange.

Overall, how has consumer behaviour and the market landscape changed in the Indian snack and confectionery industry in recent years, and how is Perfetti adapting to these changes?

The Indian snack and confectionery industry has witnessed a stark transformation in recent years — from the rise of premiumisation and e-commerce to sustainable packaging, the landscape has never been more exciting.
Today’s consumer is looking for new experiences and they can look forward to more innovations in segments like lollipops, jellies, gums. We have embraced these changes to ensure we stay ahead of market shifts. We’ve introduced innovative products across our portfolio.

Within jellies there’s the more recent launch of Alpenliebe Juzt Jelly Jungle Land and Fruity Salad, that aims to elevate the playtime experience for the target group. The Alpenliebe Juzt Jelly dual layer jelly in heart shape features two distinct layers – a soft foamy layer and a jelly layer. The product leads to a soft and chewy experience.

Under the Chupa Chups brand, we have introduced cat, feet and crawler shaped jellies, that play on taste and offer a quirky vibe. The Mentos nano pack that was introduced last year has a unique shape that is easy to carry and fun to pop open. We have expanded Center Fresh with mints first, moving on to launch numerous flavour profiles including the Center Fresh Lemon Honey Mints last year. Mentos Fanta chewy candy was a limited-edition summer offering last year born from the love of Mentos and Fanta’s fruity flavour.

Is e-commerce a big channel yet for confectionery as a category? What’s your experience?

A robust distribution network enables us to reach out to all geographies, be it traditional format or digital. E-commerce and q-commerce are emerging as a significant channel for confectionery sales in India, particularly in urban markets where digital retail and quick doorstep convenience have reshaped consumer behaviour. The appeal of e-commerce lies in its ability to provide seamless access to a wide array of products, catering to impulse cravings as well as planned purchases. Quick commerce has added an exciting dimension, bringing confectionery closer to consumers in a matter of minutes. However, urban and Tier 2 and 3 markets need a divided approach. E-commerce and q-commerce are a vital and growing part of our distribution strategy in urban markets, one that allows us to engage with digitally savvy consumers while reinforcing our presence across multiple touch points.