Dollar sales in both the chocolate and non-chocolate candy categories in convenience stores are rolling in strong with help from rising prices, even as unit sales dip across many segments.
Retailers are reporting that customers today are seeking excitement and newness from the chocolate and non-chocolate categories, and seasonal chocolate and novelty candy unit sales appear to be growing as a result.
By The Numbers
In the c-store channel, chocolate candy saw dollar sales rise 8.2% as unit sales fell 4.2%, given a 13% rise in price per unit for the 52 weeks ending Dec. 3, 2023, per Circana.
Chocolate box/bag/bar products under 3.5 ounces registered more than $2.9 billion, up 7.9% year over year (unit sales down 4.6%). Above 3.5 ounces, dollar sales were almost $567 million for the same period, a gain of 10.2% (unit sales down 2.4%).
Sales of snack-sized chocolate candy rang in at $1.2 million, down 3.3% as unit sales grew 15.4% and price per unit fell 16.2%. Sugar-free chocolate candy notched dollar sales of just over $616,000, a drop of 18.3%, with unit sales down 24.3%. Seasonal chocolate candy saw dollar sales soar 187.1% to $6.16 million, with unit sales up 170.1%. Novelty chocolate candy rang in at $412,850, up 29.9% with unit sales up 43%.
Non-chocolate candy dollar sales were up 13.7%, with unit sales down 3.5% for the same 52 weeks. Chewy candy topped all sales at $2.3 billion, a gain of 8.1%, even as unit sales fell 7%. Novelty non-chocolate candy saw sales of just under $392 million, with a whopping year-to-year gain of 79.6% with unit sales up 40.7%.
Hard sugar candy/packaged and roll candy recorded sales of just over $292 million, up by 11.1% (unit sales down 5.3%). Licorice box/bag candy sales reached just over $152 million, a gain of 14% (unit sales down 2.3%). Gum dollar sales ticked up 20.7% to $1.17 billion, (unit sales up 6.3%).
Corinne Gangloff, marketing manager for the Freedonia Group, a division of MarketResearch.com, said that the total U.S. retail market for chocolate candy amounted to $30.7 billion in 2022 and should reach $38.3 billion in 2027.
“After the pandemic boom of chocolate dollar sales from 2020 to 2022, gains will be more modest going forward,” Gangloff said. “High inflation is expected to continue in 2023, though it is forecast to slow over the next few years. Volume sales will likely continue to stagnate or notch downward slightly.”
Ken Morris, managing partner for Cambridge Retail Advisors in Boston, said he advises c-stores to aim higher, into the last-minute gift category, and bring on what he termed “premium top-dollar winners.”
“Who doesn’t like chocolate? I would push to include specialty chocolate from Belgium — the best in the world — like Godiva, Guylian or Leonidas,” Morris said.
Sales Drivers
The Army & Air Force Exchange Service (AAFES), which operates more than 580 Express convenience stores and 10 distribution centers, continues to see growth in non-chocolate candy, according to AAFES Buyer Lisa Olivares.
“The non-chocolate share has increased 2% year to date to 40% of the candy sales in Express locations,” Olivares said. “While chocolate was down 2% year to date at 44% of sales, gum and mints maintained their share at almost 16%. Chocolate singles and king-sized continue to be favorites, with Reese’s, Snickers and Peanut M&M’s leading sales. Non-chocolate products are led by bagged candy, with Sour Patch, Trolli and Haribo being top sellers.”
Olivares noted that in both segments, the most successful price point range is $1.59 to $2.99.
The Reese’s Caramel Big Cup was the chain’s largest launch back in November, but marketing spends will continue through the first quarter of 2024, Olivares said.
“New gums and mints are launching with functional benefits, such as Mentos Mints with vitamins and Respawn gum with B vitamins and green tea extract,” Olivares added. “Skittles, Nerds and Trolli will have line extensions. Hershey has launched new snack-sized peg bags for their most popular brands like Reese’s, Kit Kat and PayDay.”
Something New
But while core brands drive sales, customers are also looking to experiment with new brands and flavors.
“I truly believe the sweet truth is that people want to try something new,” suggested Sam Odeh, president of Power Energy Corp. in Elmhurst, Ill., which operates over 1,300 sites in nine states under the banners Power Mart, Power Market and Powmaro’s.
Odeh is finding value and great taste in non-traditional brands, and customers are gravitating toward the new options. He added, “European and African (flavors) are coming in more (via) direct store delivery from vendors’ brands.”
They come in both single bars and unique packages as well as a variety of price points.
“They average $1.79 for a single bar, $2.99 for king-sized and $3.99 for a bag,” he said.
Odeh urged c-stores to shake off tradition and offer new confectionery items from around the world.
When it comes to wellness concerns, Odeh said he does not believe that consumers care as much about wellness when it comes to chocolate. “You have crossed the line of sugar,” he said.
His advice to chocolate brands includes lowering prices, adding multi-sale buy-one-get-one deals and cross-promoting with value.