Primola: Cheaper media advertising is an opportunity

The owner of Primola, the third-largest company on the chocolate tablet segment, valued at 120-150m euros, decided to resume massive advertising investments to gain market share this year and says the falling price of media advertising is the opportunity of the moment.

Primola’s share of the chocolate tablet market was put at 13-15% by ZF. Kraft Foods dominates the market with Milka and Poiana.

The company dramatically scaled back promotion investments in 2009, losing ground in terms of visibility to rival Kraft, which last year reported rising market shares.

“We felt the need to rethink our strategy, and this year we chose to move to gain new consumers and not wait for consumption growth as this is little likely to happen. Media advertising prices have hit the bottom, which is surely an opportunity for us,” states Jihad Jabra, the majority shareholder of Supreme Chocolat, which posted more than 20m euros in turnover last year.

The company has recently started rebranding Primola chocolate and other products of its portfolio, a project valued at one million euros.

Jabra is the only entrepreneur closely fighting with the multinationals operating on the chocolate market. He also says the resumption of massive promotion investments in 2010 could be well-timed given the arrival of a new player on the market, with the sale of Cadbury Romania.

Chocolate retail sales dropped by 3% last year from 2008, according to MEMRB market research company. Supreme’s owner says that, moreover, he felt a consumption shift from the medium price segment to the low one.

Jabra also specified the company did not have to cut production in 2009, largely due to rising exports. “I believe we’ll have prolonged market stagnation this year. We are fortunate to operate exports. This year we want to boost the weight of exports from below 5% in 2009 to around 8% of the volume of production at the Supreme plant in Bucharest,” says Jabra.