The research and development of "Made in India" Pepero began with a brand launch proposal from the Indian local corporation (LOTTE India) at the end of 2022. It is essential to maintain the shape of the chocolate stick snack even in extreme heat of 45 degrees Celsius when producing and distributing in India.
We searched for the optimal blend ratio to create a chocolate that is heat-resistant while maintaining sweetness and flavor, and to produce crispy stick snacks locally, we looked for high-protein flour ingredients throughout India. It took three years to complete the "Made in India" Pepero.
On the 15th, during a meeting with ChosunBiz at LOTTE Central Research Institute in Magok-dong, Gangseo-gu, Seoul, Son Byeong-cheol (47), head of the Sweet2 team at LOTTE Central Research Institute, and Kim Jang-hwan (32), a researcher on the global team at LOTTE Central Research Institute, recalled the research and development process for launching the "Made in India" Pepero.
LOTTE Central Research Institute is where LOTTE Group's food affiliates such as LOTTE Wellfood, LOTTE Chilsung Beverage, and LOTTE GRS research and develop new products and new menus. From this month, the technology developed here is included in LOTTE Wellfood's representative product, Pepero, which is produced locally in India.
India was chosen as the first overseas production site since the launch of the Pepero brand in the country in 1983. It is a large market with a population of about 1.4 billion and great growth potential. There is also a high affinity and awareness of Korean culture and K-food.
According to LOTTE Wellfood, the Pepero sales are expected to reach 215 billion won in 2024. Out of this, 71 billion won will come from exports to 50 countries worldwide. This is a 30% increase compared to 54 billion won in Pepero exports in 2023.
As the scale of Pepero exports continues to grow, local production and distribution of Pepero in India is expected to be an important momentum for LOTTE Wellfood's overseas market aggression. This is because it can also target the Southeast Asian and Middle Eastern regions adjacent to India. Shin Dong-bin, chairman of LOTTE Group, stated last year at the "One Lotte Food Company Strategy Meeting" that he plans to grow Pepero into a global mega brand with sales of 1 trillion won by 2035.
The production of Pepero in India was not a straightforward process. The key challenge was whether Pepero, produced and distributed in the hotter Indian climate than Korea, could maintain its shape as a "chocolate stick snack" without melting. The answer was found after three years of hard work by the researchers at the LOTTE Central Research Institute, who raised the melting point of the chocolate to increase its heat resistance.
Kim, the researcher, explained, "You can think of it as changing the nature of the fat (fatty acids) in the chocolate. In Korea, where cocoa butter is the main ingredient, it completely melts at 35 to 36 degrees, but by mixing in fats that can withstand higher temperatures, we've stabilized the chocolate base." He added, "We adjusted the melting point using the different bonding structures of the fatty acids."
The problem was that while raising the heat resistance might make the chocolate withstand high temperatures, it could also mean that it wouldn’t melt in the mouth enough to allow for a taste of the characteristic flavor and sweetness of chocolate.
Son, the researcher, said, "By raising the melting point of the existing chocolate so that it could maintain its Pepero shape even at 45 degrees, we conducted dozens of tests to find the optimal blend by increasing and decreasing the ratios of Kakao and sweeteners, and ensuring that it still felt sweet when eaten. As a result, even in temperatures above 40 degrees, only some of the chocolate became soft, while the characteristic Pepero chocolate stick shape was maintained." Next is the Q&A.
What Pepero products are being introduced in the Indian market this year?
"There are two types: original and crunchy. The original was released due to its symbolic nature, and the crunchy product was a flavor suggested by LOTTE India. After checking the reactions in the Indian market, we decided to initially launch the two products that received the best responses." (Kim Jang-hwan, researcher)
"Korea and India have different climates. Indian people do not seem to like almonds. Moreover, there are still constraints in sourcing ingredients for other Pepero products, including almond Pepero, so we decided to focus on products that can be made solely with chocolate and flour." (Son Byeong-cheol, researcher)
Were there any difficulties in the research and development process of creating custom Pepero for the Indian market?
"I think the reason people like chocolate is that it melts easily in the mouth without chewing, allowing the sweetness to spread in an instant. However, it was surprising to be asked to create 'non-melting chocolate.'
Moreover, chocolate with too high heat resistance did not melt at all in the mouth, resulting in no sweetness or cocoa flavor. Finding the optimal blend ratio to create delicious chocolate that withstands some heat while melting in the mouth was challenging." (Kim Jang-hwan, researcher)
Did you also have difficulty in making the stick snack, which is the pillar of Pepero?
"Indian flour is completely different from Korean flour. The demand for high-protein flour is relatively low in India. This is because, when making 'naan,' which is a staple for Indians, the protein content of the flour was not important to the locals. However, the Pepero stick snacks needed to be thin and elongated in the manufacturing process, so the elasticity of the flour was necessary.
Since the protein content of the flour determines the elasticity of the dough, our researchers collaborated with domestic milling companies to conduct several business trips and investigations to find suitable raw wheat in the local area. Thanks to this, we were able to achieve stability in the shaping of the Pepero stick snack and its characteristic crispy texture." (Son Byeong-cheol, researcher)
Do consumers in different countries have different preferences for texture and flavor? Are there products developed to target the tastes of Indian consumers?
"When we created products among researchers in Korea and proposed them to the Indian local corporation, there were hardly any instances where our picks for the best and least favored flavors matched the opinions of the local corporation. Additionally, since India is a country specializing in sweet foods, the degree of sweetness perceived varies, so communication was crucial." (Kim Jang-hwan, researcher)
"We even adjusted the eating environment itself to test it according to India. Indian consumers might not eat Pepero when it's hotter than what we've experienced in Korea. So we tried eating Pepero in an environment warmed to Indian temperatures to find areas for further improvement." (Son Byeong-cheol, researcher)
Are there any other products you would like to introduce in India besides Pepero?
"For now, we plan to focus on the three items: the existing chocolate pie, ice cream, and Pepero. In India, due to religious reasons, we cannot use the word 'pig', so the ice cream originally known as the 'pig bar' has been marketed as 'crunch bar' and is selling well. Rather than simply launching brands according to our desires, we will research and develop the necessary technologies based on what flavors or products are desired in the Indian market. Nothing specific has been finalized yet." (Son Byeong-cheol, researcher)
Are there other countries considering local production or export of Pepero besides India?
"It seems that we can think about the next steps only if the 'Made in India' Pepero does well in the local market (smiles). I would love to export it to nearby countries with climates similar to India, like Southeast Asia and the Middle East. However, this needs to be discussed in collaboration with the global strategy and marketing departments to create a specific blueprint.
Still, just in case, we are obtaining all required halal certifications in accordance with recognized agencies in each country. The Pepero for India has also basically received halal certification, but considering the export to the Middle East, we need to acquire all three types of halal certification. I understand that this halal certification will be completed by the second half of this year." (Son Byeong-cheol, researcher)
What are your aspirations for the future?
"In Northeast Asia, Pepero and Pocky (the chocolate stick snack brand by Ezaki Glico, a Japanese confectionery manufacturer) sell roughly equally, but globally, Pocky has a larger market share. By 2035, I hope Pepero becomes a mega brand that achieves 1 trillion in sales, competing shoulder to shoulder with Pocky. We will devote ourselves to research and development so that people all over the world will eat Pepero." (Kim Jang-hwan, researcher)