And
lemon cheescake at that...blech... but it seems they already sell that in germany and Japan to great success. Sparkling have you ever seen one of these abominations?
Oh and according to this M&M's are "new".... seems we are not only divided by a common language but by common candy!
The GaurdianBritain has fallen out of love with the Kit Kat
Tania Branigan and Martin Wainwright
Thursday February 19, 2004
The Guardian
For Nestlé Rowntree, it is alarming proof that its advertising slogans work. Consumers are indeed having a break - from its flagship product, the Kit Kat.
Sales of the company's best-selling chocolate bar - for years the most popular in Britain - have decreased by 5.4%, from nearly £123m in 2002 to just over £116m by the end of last year. Other brands showed an even sharper drop.
So marked is the fall that the company's new managing director, Chris White, announced: "Nestlé Rowntree is a business in crisis."
Almost as surprising was his suggestion that it might reclaim lost consumers by introducing the lemon cheesecake flavour Kit Kats already beloved by German and Japanese snackers.
The firm yesterday claimed that his comments, to Marketing magazine, had been taken out of context and referred solely to marketing.
But its statement went on to add: "There has been some loss in market share in 2003 and in response to this Chris White has been brought in as the new managing director to restore Nestlé Rowntree to a No 1 position within the confectionery market."
While the chocolate firm declined to offer figures yesterday, saying it could not do so because its annual results are published next week, the independent analysts Information Resources say that its sales have fallen by £21m over the last year, to £820m.
The runaway success of the Kit Kat was one of the main reasons for the Swiss firm Nestlé's determination to capture the 19th century York-based manufacturers Rowntree in 1989.
The bar was first launched in 1935 for 2d (roughly one pence) under the name of Rowntree's Chocolate Crisp. Within two years, the snappier "Kit Kat" had been adopted and by the following year it was the company's most popular product.
It climbed to national favourite with its endorsement by Churchill's wartime government as healthy, cheap food, and maintained its supremacy within Rowntree's even after the Nestlé takeover, in spite of competition from internal rivals such as Smarties, Polos and Black Magic.
Voluntary redundancies started by Rowntree continued after the Swiss takeover but there was plenty of work for the Kit Kat section.
A new 12-line production unit costing £16.7m had opened two years before the takeover and even now, a day's production would stretch round the London Underground.
"Saying the business is in crisis is extreme and I don't think [Chris White] really means that himself," argued John Band, consumer markets analyst for Datamonitor. "But maintaining its position in the UK confectionery market is going to be a challenge. It's a cut-throat market."
Confectionery is a huge industry in the UK, worth up to £4bn. Britons eat around 10kg of chocolate each per year, according to Datamonitor, making us by far the biggest chocolate consumers in Europe. But sales have almost reached saturation point, analysts believe.
"It's difficult to persuade people in the UK to eat more chocolate because we eat so much of it already," said Mr Band. "The way the competition has been playing out over the last five years has been very much one of bringing out exciting new products or extending lines to steal share and sell products that are more expensive."
Those brand extensions have made it extremely difficult if not impossible to compare the performance of rival products precisely; Nestlé Rowntree insists that Kit Kat is still the country's best selling chocolate bar, if the Kit Kat Chunky, Kit Kat Kubes and other lines are included. Similarly, Cadbury Trebor Bassett includes numerous specific products under the brand Dairy Milk.
But Information Resources statistics suggest that the Kit Kat has been overtaken by its rivals, Dairy Milk and the Mars Bar, just as Nestlé Rowntree has, in recent years, been overtaken by their respective manufacturers, Cadbury Trebor Bassett and Masterfoods (confectionery).
The company was actually one of the first to bring out a successful "brand extension" in this country; its Kit Kat Chunky was immediately popular when it launched in 1999, in response to flagging sales of the main brand, although its sales have dropped by 18% over the last year.
Nestlé Rowntree failed to follow that up in recent years, although the Kubes - small pieces of chocolate-covered wafer - have been reasonably successful, perhaps because people enjoy sharing them.
Dan Babb, account director of Information Resources, says consumers are increasingly keen on products they can offer to others and blocks of chocolate such as Bournville are selling more than ever for this reason.
Cadbury Trebor Bassett has traditionally excelled in this area, boosting the firm; its sales rose from £945m in 2002 to £970m in 2003.
Nestlé Rowntree's recent block offering, Double Cream, has performed respectably but not outstandingly.
Mr Babb added: "To me, the brands like Toffee Crisp and Kit Kat look a little bit old-fashioned. They seem like 70s brands and perhaps staid. Mars have introduced things like M&Ms which are quite new in comparison."
Amid fears that consumers may turn to healthier options in future, one possible way forward may be to invest in low-sugar, low-calorie products, which a recent Euromonitor report suggested were becoming increasingly popular - particularly given the government's drive to promote nutritious diets.
Companies are also looking outside the UK to less-saturated markets, such as eastern Europe.
The most recent production line for Kit Kats opened in the Bulgarian capital Sofia two years ago, and was described by the deputy prime minister Nikolai Vassilev as "not the biggest investment in the country but the sweetest".
Another key change will be to the firm's marketing. Mr White criticised its sponsorship of Pop Idol on ITV last year.
"It didn't sell more products as it didn't give consumers another reason to buy," he told Marketing. "People are already aware of our brands ... Our challenge is to make advertising that will get more people to buy more product at a higher price, to make more money for ourselves and our retail customers."
He added: "We're No 3 in the market and we want to get back to No 1."
Industry experts agree that the firm still has everything to play for. After all, Masterfoods (confectionery), the manufacturer of the Mars Bar, has also seen sales shrink, from £979m to £943m, according to Information Resources,
"It's not unattainable; one big brand or a few percentage points [on existing lines] could see Nestlé Rowntree at the top," said Mr Band.
"If their only idea were a lemon cheesecake Kit Kat, they would be a business in crisis in a very genuine sense. I'm fairly certain they do have an awful lot more ideas in hand to win back brand share."
History of a bar
· Rowntree's Chocolate Crisp was launched in September 1935. It became Kit Kat in 1937
· It is believed the name came from the Kit Kat Club, an 18th century Whig literary club which had such low ceilings that paintings hung inside had to be snapped in two
· During the second world war, the Kit Kat was portrayed as a valuable wartime food. In 1945, milk shortages forced its makers to use plain chocolate and the Kit Kat packaging was blue for a time
· The slogan "Have A Break - Have A Kit Kat" has been in use since 1957
· Its fans include actor Pierce Brosnan and former England rugby international Rob Andrew, the company says
· Kit Kat Chunky was launched in 1999
· According to the Kit Kat website, 47 bars are eaten every second in Britain
:: shakes head to clear it ::
;D
