Kinder brand seeing success in U.S. confectionery market
Ferrero USA following U.S. launch of Kinder Joy with Kinder Bueno.
The reception to Kinder Joy seems to be a source of joy for Ferrero USA.
Since the company brought the egg-shaped surprise-inside product to the U.S. in late 2017, it’s generated hundreds of millions of dollars in sales and praise from industry and consumer groups alike.
While Paul Chibe, president and CEO of Ferrero USA, said reaction to the product has been “beyond the company’s expectation,” it couldn’t have been a total surprise, given the global popularity of the Kinder brand.
First created in 1968 by Michele Ferrero, the brand is available in more than 170 countries and includes a range of chocolate products, particularly the well-loved Kinder Bueno and Kinder Surprise Eggs, which feature a toy directly inside a chocolate egg-shaped shell.
But up until two years ago, Kinder products weren’t really available in the United States. That’s especially true for Kinder Surprise Eggs, which are illegal under decades-old FDA regulations that forbid embedding in confections “non-nutritive” items that don’t serve a consumption-based purpose.
Kinder Joy, which Ferrero launched in Italy in 2001, circumvents those regulations. The egg-shaped package contains separately-sealed halves, with the surprise toy on one side and two hazelnut wafer balls and two layers of cream on the other.
“We felt it completely appropriate for this market,” Chibe said. “It’s a little bit of a different eating experience than Kinder Surprise, but it still delivers on that consumer insight of giving mom, dad or a grandparent the opportunity to give their child or grandchild this treat with a little toy.”
And the market responded. Ferrero USA said Kinder Joy earned $164 million in revenue in its first year and $200 million in its second. Roughly 240 million units have been sold since the launch.
Kinder Joy also received the 2019 Product of the Year Award in the Kids Novelty Snack category, and Chicago-based research firm IRI recognized it as the top 2018 food and beverage New Product Pacesetter.
While it struck a chord with consumers, Chibe also noted its performance has benefited retailers. He added Kinder Joy is a Top 3 front-end SKU for several of Ferrero’s key accounts.
“The retailers is looking to grow their business just like we are, and when you’re bringing out an innovation that’s 50 percent incremental for them, you’re driving value,” Chibe said.
Springboarding off the success of Kinder Joy, Ferrero USA this month marked the official U.S. introduction of its second Kinder product: Kinder Bueno. Launched in 1990 and available in 60 countries, it features a thin, crispy wafer, a creamy hazelnut filling and a milk chocolate shell drizzled with dark chocolate.
“It delivers a superior, premium eating experience that’s accessible to everyone every day,” Chibe said. “That’s something that just lends itself to being a great business here for us, a great opportunity for us.”
Ferrero celebrated the introduction Nov. 8-9 with a speakeasy-inspired pop-up experience in New York City. Consumers, media and influencers were guided through rooms highlighting each of Kinder Bueno’s ingredients.
“By deconstructing the experience like the team did in the speakeasy, we were able to show how each of the pieces come together to give Kinder Bueno such an amazing taste experience that’s completely unique.”
Recently, Ferrero has employed exclusive, pop-up experiences to build excitement around its brands. Last week the company announced the Hotella Nutella contest, which will give three superfans of the hazelnut and cocoa spread a culinary weekend in California. This week, Ferrero hosted a gathering in Chicago to celebrate the launch of the Ferrero Golden Gallery Signature boxed chocolate assortment.
“You can, in a very cost-effective way, generate a lot of excitement for your brand,” Chibe said. “If you do it well, you can create a great analogue for the experience you’re trying to give.”
For now, Ferrero is focusing on supporting the launch of Kinder Bueno, but Chibe said there are future opportunities with the Kinder brand in the United States.