Sweet and savoury snacks in Russia

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Economic recovery and growing consumer expenditure on food are underpinning demand for sweet and savoury snacks in Russia. According to Euromonitor International's Countries & Consumers database, Russian GDP grew by 4% in real terms in 2010, reversing the 8% decline registered the previous year.

Future direction

The forecast period performance of sweet and savoury snacks is anticipated to be less dynamic than that of the review period. Sales growth will slow to a retail volume CAGR of 2% over 2010-2015 and a constant value CAGR decline of 1%.

Volume sales are set to benefit from sustained expansion of the snacking culture, particularly in rapidly developing urban areas. A gradual change in local drinking habits from spirits to beer and wine may benefit demand for savoury snacks.

Fruit snacks will continue to benefit from the growing demand for healthier products, with the category forecast to achieve the strongest growth in volume terms over 2010-2015, with a CAGR of 11%.

As the obesity rate in Russia is rising and health concerns are increasingly raised by consumer groups and the media, manufacturers may seek to start introducing a variety of healthier snacks with a lower fat and salt content. These currently have low penetration.

Segmentation will be another means to develop product offer. Snacks which appeal to children are already available, such as Bombaster from KDV Group and Kukuruznik from Russky Produkt OAO. The next step will be the introduction of snacks for other consumer groups, such as teenagers, weight watchers and families.

Gradual saturation in sweet and savoury snacks will restrain more dynamic value sales growth. Imported products will continue to lose share to local, low-cost snacks offering a good price/quality proposition. Value growth will also be constrained by expanding private label products, which are expected to gain stronger consumer acceptance.

Source http://blog.euromonitor.com