Russian snack growth attracts Finnish group
image of its flagship Finn Crisp brand to take advantage of a
growing market for high fibre and wholegrain snacks in Russia and
lure increasingly health-conscious consumers across Eastern Europe
and Southeast Asia, reports Chris Mercer.
The firm said it had changed the original Finn Crisp packaging design to give the brand a more youthful and dynamic feel, enabling it to fit in better with a rising trend for convenience snacks among younger, fast-living consumers in all its target markets.
Vaasan gave Russia special recognition due to the company's "significant growth" there in recent years. Finn Crisp crispbread and thin crisps now hold an 80 per cent share of the imported crispbread market in Russia, although crispbread consumption remains quite low at 100g per capita - compared to around 2.5kg per capita in areas of Vaasan's more established Nordic markets.
Magnus Johanson, director of Vaasan's international operations, told Cee-foodindustry.com that he thought the Russian crispbread market would rise by 20 per cent year-on-year as a result of increasing economic stability in the country and a general consumer trend towards foods combining both health and convenience.
"We're going to be spending quite a lot on marketing and new product launches to recruit new consumers," said Johanson, who added that Vaasan had just launched high-fibre, wholegrain crisprolls in Russia.
And the firm plans to move further into trendy on-the-go snacks by introducing rice crackers and wholegrain crackers later this year, as well as work harder on new flavour varieties.
"We currently have a strong position in the St Petersburg and Moscow areas, but Russia has over ten other cities with more than one million inhabitants, so our opportunities for growth are good," said Johanson. The company is already building a partnership network with local companies and planning product launches in the new areas.
Other large markets are also opening up, with the first crispbread lots exported to China last autumn. The results of preliminary marketing in China are expected soon, and Vaasan has already said it plans to expand aggressively across Eastern Europe and Asia generally.
Logistics will be a challenge for Vaasan if it moves further into China and Southeast Asia due to the company's policy of making all Finn Crisp products at its Finnish factory in Kotka.
However, if the company continues its policy of making deals with local firms it may overcome this whilst also gaining insider knowledge of the market. China certainly holds enough potential, with a packaged food market worth almost €36 billion and growing around 8 per cent annually.
Johanson said expansion meant Finn Crisp's new packaging would also be necessary to give the enlarged product portfolio "a harmonious, easily recognisable look". Indeed, the company recently announced it would spend €3 million to further improve crispbread packaging and automate palleting operations at its Kotka factory, to cope with increased demand.
Finn Crisp products are already sold in more than 30 countries, including the UK, Germany and the United States. Vaasan had a turnover of €275 million in 2003.
