Unilever Israel cereal sales plummet

Telma products, photo: Tamar Matsafi, Shlomi Yosef
Telma products, photo: Tamar Matsafi, Shlomi Yosef

The salmonella crisis has seen Telma's market share fall 44.3%, while rivals have seen sales skyrocket.

Unilever's cereal market share has plummeted to a 44.3% low, with Unilever losing sales totaling NIS 2.3 million (in consumer prices) in one week, according to StoreNext data received by "Globes".

The data reflect a full week of crisis, including sales days last Friday and Saturday night, when it was already clear that "Cocoman Tzdafim" cereal packages had been marketed to consumers. At the same time, it is evident that the slowdown in company sales during the weekend was particularly sharp, compared with earlier this week; the data presented here is a weekly average.

The entire cereal market dropped by 11% this week, with total sales of NIS 10.5 million, compared with NIS 11.8 million three weeks ago. This is a 13.8% crash, compared with market sales one month ago.

Each and every one of Unilever's cereal brands lost market share during the first week of the crisis. The sales of Telma cornflakes, in which salmonella was discovered, plummeted 38.5%, with a low of 11% in its revenue market share in the category, compared with 17.7% three weeks earlier and an even larger revenue share in the months before the crisis.

In a week, Delipecan sales dropped by about a half (-48.7%), after it was initially announced to be infected with salmonella, reports which Unilever only chose to correct last week.

Until last Thursday, Unilever had concealed that its Cocoman brand was contaminated but apparently, as soon as this was revealed, brand sales also fell sharply. Overall, Cocoman sales dropped by 35.7% last week, also reaching an all-time low in its revenue share.

Other company brands had also been negatively affected. For example, sales of the Cariot brand dropped 23.9% in one week. The overall crash in Unilever cereals, which is not limited only to contaminated brands, indicates that it and its cereal brands have lost the public's trust.

The fall in cereal sales continued yesterday (Sunday), with some retailers estimating that the situation would deteriorate until the weekend.

The benefit from Unilever's salmonella crisis is being reaped by all of its competitors, mainly Nestle cereals, of the Osem Investments Ltd. Group. In the past week, Nestle reached a record market share of 35%, compared with 25.1% two weeks earlier.

While Unilever cereal sales fell 33.3% in a week, Nestle sales had skyrocketed by 24.5% during this period. Diplomat's Kellogg's brand also profits from the salmonella in Unilever's cereals, with sales increasing by 32.2%, reaching a market share of 5.2%.

The private cereal brand of Shufersal Ltd. (TASE:SAE) also benefited from the situation, with market share rising from 1% three weeks ago to 1.5% last week, a 46% increase.

Published by Globes [online], Israel business news - www.globes-online.com - on August 8, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

Telma products, photo: Tamar Matsafi, Shlomi Yosef
Telma products, photo: Tamar Matsafi, Shlomi Yosef
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