Consumers Find Comfort in Candy
By Angela Altass
Confectionery categories have soared over the past year as consumers, dealing with a range of emotions, sought items that could provide pleasure and comfort.
“The pandemic has affected our business in a very positive way,” says Dave Scholtens, co-owner and president, Scholtens Candy Incorporated. “I think the confectionery industry is doing fantastic. There’s a lot of stress eating going on. Our business has grown significantly. We’ve basically doubled our business during the pandemic.”
Confectionery companies have been experiencing large increases in business since the start of the pandemic.
“We were lucky as the pandemic affected us in a positive way with more demand from retailers and customers,” says Stephanie Leger, key account director, Mondoux Confectionery. “Customers preferences changed since the beginning of the pandemic, which positively impacted gummies consumption. Mondoux is currently increasing production and accelerating our growth in response to customer demand.”
Last June, Mondoux Confectionery added the new Sweet Sixteen 400g product Extra Sour Bears to its line and additional size packs (185g and 1 kg) are coming in September.
“Brand recognition is key in the confection market,” says Leger. “Last year, we totally revamped Sweet Sixteen packaging and branding to offer customers a new look. These marketing actions certainly had an impact on our incredible 2020 sales results. Sweet Sixteen is driving the total confection category with results way over 2020 market average of +6% for total category.”
Consumers are looking for larger pack sizes and better quality products, says Leger.
“We have seen major sales increases on our 1kg bags,” says Leger. “Gummies, especially mixed gummies, have lead the confection category during the pandemic. We have the number one brand in Quebec.”
As online sales are increasing, conventional retailers need to provide a unique customer journey with personalized customer service, says Leger.
“Since the pandemic, customers are looking for a one-stop shop and want their shopping experience to be easy and smooth,” notes Leger. “As confection is, in general, an impulse sale, displays and signs are essential to drive sales.”
Scholtens Candy has added plant-based gummies and sours to its’ product line.
“I am excited about the new plant-based line,” states Scholtens. “They are vegan-friendly and are made with absolutely no animal by-products. Whereas typically the candies would have gelatin in them, these products are made with a potato starch. We are seeing some strong interest in them from some fairly large retailers. Sugar-free candy is also another category that is slowly showing gains for us.”
Candies that are free of animal by-products now make up 60 per cent of the market in Europe, says Scholtens.
“When we first launched the new products a year ago we called them veggie candies and they did terrible,” says Scholtens. “We import, package and distribute the product. Veggie is a European term and because we had brought the product in from Europe, we called it veggie but people actually thought there were vegetables in it. We redesigned the packaging and re-launched it as plant-based with no animal byproducts and now it’s doing well. Sometimes little tweaks can help.”
When it comes to displaying confectionery products, Scholtens advises retailers to make use of free display racks provided by suppliers.
“There’s typically a lot of thought and energy that has gone into the design,” says Scholtens. “Follow a planogram if your company has one and, as it is an impulse item, the rack needs to face the door. Nobody goes into the store for our product but a lot of people leave with it so placement between the door and the till gives store owners an opportunity to make very healthy margins with essentially zero labour because we supply all of the work through direct store delivery (DSD).”
Scholtens’ Cottage Country brand is good quality at a fair price, says Scholtens, adding that jujubes are the number one seller in Canada.
“Our product is a great fit for convenience stores,” says Scholtens. “We do much better in convenience than in grocery because our products are impulse and mainstream. A bag of jelly beans made right here in Kitchener doesn’t need an introduction. The customer is looking for fresh, good value, good taste and quality and with our product, they’ll come back again and again.”
Nestle has launched several new products this year, including new single bars, such as the Coffee Crisp Double Double and Kit Kat Chunky Popcorn.
“These bars both launched in 2021 and early consumer response has exceeded expectations,” says Mike Zepp, CCSD manager confectionery, Nestle Canada Inc. “We have also launched some exciting flavours and innovations within the tablet and pieces categories, including Smarties tablet and Kit Kat Chunky minis.”
Despite fewer retail trips by consumers, the chocolate category has grown over 10 per cent as chocolate is being added to more planned lists with a shift towards future consumption formats for at-home occasions, says Zepp.
“Conversely, changes in shopping dynamics have challenged retailers’ ability to capitalize on the most impulsive and expandable snacking occasions,” says Zepp. “To realize the continued growth, profit building, and basket building potential of the chocolate category, convenience and gas retailers will need to work collaboratively and aggressively in both immediate and future consumption occasions with new, disruptive and frictionless tactics.”
Consumers are looking for chocolatey treats, says Zepp.
“They are primarily looking to satisfy a need for fuel, mood shift, indulgence and bonding,” says Zepp. “Chocolate is a repertoire category, meaning that shoppers often buy different brands depending on their consumption driver or need state. The fuel need is about providing an immediate boost for your body, whether as a hunger buster or an energy recharge and it is the need most often satisfied in the convenience and gas channel through singles and king-size offerings. Mood shift is about satisfying your mind with an uplifting break or tasty distraction. Several formats can satisfy this need with the pieces format gaining in relevance across channels as it is very permissible and poppable. The indulgence need satisfies the senses with a sensorial experience or as a sweet finish to a meal. Innovation and variety is key, offering a breadth of assortments with new flavours and textures.”
Brand recognition is one of the leading considerations for shoppers when they are looking to purchase chocolate, says Zepp.
“Shoppers look for what they recognize or expect and take very little time to make the selection,” says Zepp. “If the brand they want is not available they are highly likely to walk away without purchasing the category. Having a robust assortment across top brands is essential to maximizing the impulsive and expandable nature of the category.”
Zepp recommends placing top single bar and king-size brands near the checkout.
“The top impulse items should be on the counter,” he states. “Larger future consumption formats should be placed in a more central location in store to give shoppers time to browse. I recommend secondary displays in high traffic, highly visible areas. Key adjacencies include beverage fridge, ready-made meals, hot beverage bar, magazine and newspapers, and gift cards.”
Consumers are looking for brands they recognize and trust, says Nicole Harari, director, impulse, Ferrero.
“Brand recognition is critical,” says Harari. “Consumers are more likely to be motivated by brand loyalty than impulse, especially when shopping mints, candy and gum,” says Harari. “In a recent Iposis study, 51 per cent of consumers indicated that they know the brand they want to buy before they start shopping for mints, candy and gum.”
With people on-the-go, purchase decisions are made in seconds and people aren’t stopping to read descriptions or browse, says Harari.
“Over the past year, we’ve also seen an increase in buying Canadian, like our Tic Tac mints or Ferrero Rocher chocolates,” says Harari. “Canada has one of the safest, most trusted food systems and that’s important when you want the best for you or your family. More brands are highlighting and promoting made in or prepared in Canada across retail and impulse channels and at Ferrero, we’re proud of being able to manufacture many of our products in Canada.”
Brand recognition is also important when launching products because consumers feel more confident trying something new from a brand they already know, says Harari. This fall, Kinder Bueno White becomes a permanent addition to Ferrero’s Kinder Bueno portfolio.
“Previously only available as a limited edition, it’s a great addition to the all-year-round Kinder Bueno line-up, which continues to grow double digits,” says Harari. “Also this fall, Kinder is launching Applaydu, a free digital app that helps bring Kinder Surprise toys to life in a fun world of discovery and imagination through augmented reality. Designed for families, the app helps develop creativity and builds skills through fun family activities.”
Multi-buys are becoming more important and can help build basket size, says Harari.
“Finding the right items to co-promote will encourage consumers to trade up, which helps make up for fewer store trips,” says Harari. “It’s also important to understand what sells well in your store so that you can make sure those items are visible on the front counter or shelves. Consumers like to have choice but given decisions are made in a few seconds, it’s also important to stock category leaders that are quickly recognized along with unique offerings.”
Ferrero’s total Kinder everyday business is up +16 per cent and Harari notes that the sale of treats generally has been steady throughout the pandemic as people look for some normalcy and joy.
“Despite the challenges we’ve all experienced this past year, we’ve seen tremendous growth with our Kinder portfolio and Tic Tac fruit and novelty offerings within the C&G channel,” says Harari. “Tic Tac Coca-Cola had phenomenal growth numbers while our fruity flavour range, led by Tic Tac Berry Adventure, hit +50 per cent. Mint consumption shifted from at-work occasions to at-home, with some declines in mint, however, we do expect mint to recover as social and return-to-work occasions return. While consumers moved away from mint, they moved towards the Tic Tac fruit flavoured options and non-mint flavours.”