More than 2,000 new treats and snacks debuted at the National Confectioners Association’s (NCA) 13th annual All Candy Expo in Chicago this week. The expo brought together hundreds of manufacturers, buyers and industry leaders from more than 69 countries.
What’s New
On the trend front, tried and true candy favorites are offering new flavor twists, such as limited edition Coconut M&M’S and Skittles crazy cores, which feature two flavors in every piece. Superfruit and exotic flavors also commanded the floor. Jelly Belly, for example, introduced an Acai Berry flavor, as well as a new superfruit mix of pomegranate, blueberry and cranberry flavors.
Mango was a big flavor at the show, appearing in as an inclusion in chocolate, and a flavor in gum, jelly beans, gummy candies and even a new Tic Tac variety. Gourmet and premium chocolates, super sour and tangy candies and seasonal treats were other trends on the show floor.
Many companies were catering to nutrition conscious consumers, offering gummy candies sweetened with all-natural fruit juices. Mars Snackkfood U.S. is rolling out new packaging to be completed next year that will feature the calorie amount on the front of each candy package. In a press conference on new item trends, presenters noted that when taste and nutrition collide, taste wins every time.
Knowing the target audience you’re trying to reach with the candy you are offering, choosing clean, distinct and desirable products, and remembering that children respond to colorful packaging can help drive business.
Reaching Consumers
A presentation on retail merchandizing in today’s rapidly changing environment showed that reaching consumers is more complex than ever, with consumers getting information from a myriad of sources including in-store, social networking, online, TV and phone.
Today, just 17% of Americans tune into the most popular TV show, versus 60% in 1970, a sign it’s harder than ever to reach a mass audience with only one medium of consumer-based advertising.
Multidimensional marketing through in-store, Web site, coupons and more may be the best strategy. Coupons are back, up 17% this quarter, and are now being offered online. Digital signage in stores could be a powerful wave of the future but some kinks in the technology still need to be worked out.
Smart phone applications are another way to reach consumers, and one is currently being designed for Wal-Mart. Text messaging could become an important tool in reaching the now 13-17-year-old generation as they come of age. A consumer in this generation sends 2,500 texts on average per quarter. To reach moms, being part of a social networking site is key.
Stores, however, remain the key point for reaching consumers. The trick is not just getting traffic, but converting that traffic into purchases. Tactics can include secondary displays, coupons, signage and speaking with consumers about new products.
Increasing Candy Sales
Kit Dietz, president, Dietz Consulting, discussed a study sponsored by the NCA, the American Wholesale Marketers Association (AWMA) and the National Association of Convenience Stores (NACS), that identified opportunities to reduce costs and improve profitability in c-stores, and how this relates to candy sales. The study was featured exclusively in the May issue of Convenience Store Decisions.
The good news for c-store owners is that confections are recession resistant, although not resistant proof, he said. About 93% of confections consumers visit their store weekly, and confections generate 36% higher true profit than the average SKU. What’s more, the top 50 SKUs generate about 32.8% of sales volume. The top 50 SKUs don’t change and are the same everywhere.
In fact, the top 10 chocolate SKUs have remained the same for the last 10 years. To maximize sales, retailers should focus on offering these core items, optimizing store space and creating an exit strategy for non-selling confectionary items, so they don’t consume shelf space that could be used for more profitable products.
C-stores need to get better at moving product in and out of the store faster, using discount bins to get rid of non-moving product, understand trends earlier, getting more lead time from manufacturers and increasing the speed of execution. Matching the speed at which the drug channel executes new products could result in a $1 billion plus opportunity, he said. Mastering this quick in-out product movement will inspire manufacturers to use c-stores as the cannel for new trial products.
“We have to be better at reacting to what the consumer is looking for,” Dietz said. He advised that retailers, distributors and manufacturers come together to grow the category.
