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Panel Touches on Trend Explosions in Candy
A panel of candy experts at the AWMA Summit yesterday agreed that the confection category is driving sales in the convenience channel. Moderated by Jim Corcoran, Vice President of Trade Relations for the National Confectioners Association, the panel represented three leading candy manufacturers – The Hershey Company, Cadbury Adams USA, LLC and Mars Snackfood US, LLC.
Corcoran kicked-off the discussion with an overview of confection category growth. He told the audience that wholesalers are "driving confection category sales. We are seeing an average of 8% growth in this category in the c-store channel. This year, c-stores will actually overtake supermarkets in confection sales if things keep progressing the way they are now."
Candy and gum sales come in third after the leader, carbonated beverages, and second place holder milk. Corcoran identified dark chocolate, organic and gourmet confections as trends driving sales. "These categories of confections have increased 32%," Corcoran stated. Other trends to watch include sugar-free, licorice, gummies, mints and seasonal products.
Lynne Vandeveer, Vice President, Sales, for the convenience channel of Cadbury Adams USA, LLC, emphasized the role that innovation plays in the rising sales of candy, gum and mints. She referred to the Cadbury Adams Factbook, a resource that is part of a program instituted in 2004 by the company to maximize innovation in its products. "The Factbook indicated that almost half of our Cadbury sales came from items that weren’t around two years ago," Vandeveer said. "We see innovation as the rocket fuel driving growth."
Vandeveer pointed to three trends that are putting gum at the center of today’s health and wellness emergence. "Forty-one percent of users chew gum as a substitution for eating a snack," Vandeveer noted. She also said research shows that chewing gum makes you smarter, and that gum chewing is becoming more acceptable in today’s society.
Dennis Alderson, Vice President, Convenience, for Mars Snackfood US, LLC, said c-stores represent one-third of all confection sales, outperforming drug stores and mass merchandisers. He concurred with Vandeveer that innovation is key to growth in the category, and emphasized the King Size phenomenon.
"King size has exploded, driven by the value one gets for the money," Alderson stressed. "We see big opportunities in king size, as well as theatre box size." He also noted that dark chocolate is a huge trend, and has grown at 45.6%.
He also said that the merchandising opportunities with all confections are immense since the category is so impulse driven. "We need to have candy in more than one location," Alderson continued, "like by the beverages and the check-out."
Dave Onorato, Global Vice President Sales Convenience, Specialty, Foodservice and Dollar, The Hershey Company, emphasized how consumers love iconic brands – such as Reese’s, Hershey, Kit Kat, etc. He said that chocolate has the highest sales in the chocolate category, and that Hershey accounts for nearly one-half of all chocolate sold. "It’s the biggest and most important snack category for retailers, which flows through the warehouse," Onorato said.
While core brands are driving growth, he also noted that Hershey’s experiences have led it to rely on a more disciplined approach to limited edition items. He said this year’s Elvis promotion was a huge hit.
Onorato concurred that king-size items are exploding in popularity, noting that total c-store king-size sales have reached $433 million. Touching on the topic of innovation, he remarked at the amazing growth of stick gum to the many varieties now available to consumers.
He urged wholesalers to "take back the store from the DSD environment. Think of all the products you have that flow through your warehouse. We should work together to take back the real estate in the c-store."
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