Dairy-based ready-to-eat desserts are proving popular across ME as consumers look for more nutritious snacks.
The Middle East's dessert sector has enjoyed a boon in recent years as the region's growing population looks for sweet but healthy snacks. And with health concerns increasingly in the minds of consumers, dessert manufacturers are increasingly looking to produce tasty products that also offer some nutritional benefits. RNME spoke to Unilever and Al Safi-Danone about growth and trends in the sector.
What dessert products do you have available in the Middle East and when were they launched?
Al Traboulsy:We have a number of desserts and toppings under the Carte D'or brand. The desserts come in various flavours including gelatine powder, cheesecake, vanilla mousse, strawberry mousse, chocolate mousse, cream caramel, tiramisu, and brownies.
Toppings include a wide variety of flavours such as chocolate, toffee, strawberry, hazelnut, wild fruit, mint, peach, coffee, vanilla, sour cherry and mango peach.
Carte D'Or ice creams and desserts have been in Europe since the 1980s with a variety of flavours. Today Carte D'Or is the number one brand in the premium ice cream sector there. However they have only been recently introduced here in the Middle East and only in two markets, one year ago in Egypt and only four months ago in the UAE.
Najem:In the Middle East, Danone operates through a joint venture with Al Safi, a KSA company. The factory is in KSA and it produces for KSA and all the GCC countries we entered the segment in the UAE in 2004 and definitely we are working on the brand awareness. We have Danette as a pudding and we have Danino as a drink dessert. It is a category growing now by about 55% versus last year.
Danino is a kids' proposition and there is also a spoonable variety. In Danette you have the cream caramel and chocolate, biscuit and other flavours.
For Danino we have a couple of flavours. In the UAE we have only two flavours, while worldwide we have far more. The desserts are made with natural products; fresh cows milk and cream, fresh fruit, sugar and health products such as vitamins and calcium, which can help the growth of children. This is Danone's way - to make products that are tasty and healthy.
Are they proving very popular? What level of growth have they achieved?
Al Traboulsy:Given our short history in the Egypt market, we're in a good position in hotels and restaurants, enjoying high double-digit growth that we're expecting to sustain for several years to come.
In the UAE it is still a very new launch, but the initial feedback is very positive and we believe we also have a potential in this and other GCC markets.
Najem:We are growing Danette by 85% compared with last year, which is tremendous growth. This growth is mainly coming from a focus on above-the-line promotions - particularly an advert that we have been airing a lot lately. Saudi Arabia, UAE, Kuwait, Oman, Qatar and Bahrain in the GCC, and also the Levant countries, are proving to be strong markets for puddings and fruit yoghurt.
Customers are better educated now about what kind of dessert they want. They are turning away from fatty, sweet desserts in favour of more healthy products and Danette and Danino can suit that perfectly.
Danette, as a dessert for adults, has indulgence value...and at the same time it is more healthy than many other desserts. The government and media are working on raising awareness of health issues, and this will also help grow the category. We hope to benefit more than the other competitors.
How is the category growing in the region? Have you adapted any of your brands of dessert to Middle Eastern tastes?
Al Traboulsy:With the rapid growth of the out-of-home sector in the region, more and more people are going out seeking more entertainment and fun, and what is more fun than having a delicious piece of dessert? We have made some good work with our R&D team to ensure that we give our customers the maximum indulgence out of this moment.
Are there plans to introduce more dessert products?
Najem:Always we have new launches and recently we launched two Danette flavours, cookies and hazelnut.
Al Traboulsy:We're still new to the market and we'll keep supporting our category. For the time being our focus will be on our current range, yet innovation is certainly an integral part of our future growth.
How do you see the sector developing in the next couple of years?
Al Traboulsy:In the whole region and in the Gulf states in particular, business is booming, the market is developing, and tourists are flooding into our region - which is reflected in the significant growth in the food market. We're hopeful that this positive trend will continue in a stable and safe market environment.
Najem:The market will develop fast especially now that the awareness levels are improving. We are focusing a lot on marketing activities to enhance that further, and people are moving from unhealthy food and sweets to the healthy, of which dairy is a major one.
What challenges are you facing in the sector, and how is competition in the sector?
Najem:The awareness levels do need to be raised further. One of the main challenges is the continuing increase of operational and production costs. There is also increased competition, with most of the dairy companies in the region trying to enter this segment, which is considered the new trend.
For next year we have an aggressive plan for Danette and Danino in terms of new flavours and even different sizes. I think the challenge is more to focus on getting the message across to consumers that this is a healthy product.