While gum sales have been flat, flavor and packaging innovations as well as better-for-you (BFY) and functional options are opening up opportunities for growth in the gum segment.
Earlier this year, Gerrit J. Verburg Co., announced the reintroduction of three classic chewing gum brands: Black Jack, Clove and Beemans. Black Jack lays claim to being the first chewing gum brand sold in the U.S., and Beemans traces its history back to the 1800s when it was promoted as a digestive aid. Undoubtedly, the manufacturer is banking on consumers embracing the nostalgia of the products. Time will tell if it can create movement in a segment that traditionally does not experience sales spikes.
Overall gum dollar sales at c-stores for the 52 weeks ending Dec. 30, 2018, totaled $10.4 billion, up 1.5% over the previous year, according to research firm IRI. Sugarless gum fared best with $862 million in dollar sales, up 3.1%. Regular gum saw dollar sales of $182 million, down 5.7%.
A March Mintel Group report on gum, mints and breath fresheners described the market as “softening,” partially because consumers are no longer attracted to the fresh-breath message in the modern retail environment. Plus, Packaged Facts anticipates a compound annual growth rate (CAGR) of 0.9% for gum in the years 2017–2022.
That said, a few developments have c-store owners and operators feeling sweet on the category.
VALUE PERCEPTION
“After years of declines, the combination of flavor and package innovation has helped drive growth,” said Derek Gaskins, senior vice president of merchandising and procurement for Yesway. The Des Moines, Iowa-based c-store chain owns and operates 150 sites in several Midwest states.
“As is the case in nearly any category, growth is highly dependent on innovation in packaging and flavors, so both gum and mints look very different than they did five to 10 years ago,” added Carly Schildhaus, public affairs manager for National Confectioners Association, which hosts the annual Sweets & Snacks Expo this month in Chicago.
The big news last year was the Tic Tacs brand expanding into gum, earning it the Most Innovative New Product honors at the 2018 Sweets & Snacks Expo. Trident Vibes also made its debut, and Hershey released its Ice Breakers Ice Cube glitter gum.
“The latest and greatest flavor to enter our sets has been Orbit Freeze … released last summer. … Through Q1, we’ve seen some early success with the line,” said Joe Bortner, category supervisor for Rutter’s c-stores, which operates 75 locations in Pennsylvania, Maryland and West Virginia.
As for product launches in 2019, Extra Refreshers by Mars Inc. had a nationwide rollout last month. The sugar-free soft chew gum features three flavors, Spearmint, Polar Ice and Tropical Mist, and is offered in 40-count bottles or 120-count standup pouches.
Indeed, packaging appears to be as key of a purchase motivator as flavor.
“Our consumers are telling us there’s a greater value in resealable bulk packages,” said Bortner.
“Bottle pack/large pack gum flavors and brand offerings continue to expand, so we are working on ways to add more variety of bottle packs into our stores,” said Diana Turgut, buyer for the Army & Air Force Exchange Service, which includes 122 main stores and more than 500 c-stores across the country servicing military personnel and their families.
Turgut has devised a three-prong merchandising strategy, starting with expanding bottle gum products in the inline express candy planogram. Part two calls for adding Ice Breaker Ice Cube bottle packs to lane blockers this summer, highlighting additional flavors. For the third element, she hopes to remind people about the fresh-breath benefit of gum and mints.
“Our coffee condiment rack will be updated with Wrigley’s Extra Refreshers,” she said.
Functional Varieties
One of the biggest influences on gum and mints sales right now is people’s commitment to BFY snacks. For example, of the approximately $4.1 billion in total U.S. retail dollar sales for gum in 2018, as reported by Packaged Facts, 85% was derived from sugar-free products. According to 360 Research Reports, the global sugar-free segment could climb to $14.9 billion by 2023.
Mintel Group asked consumers which healthy qualities they want offered in gum, and 35% identified vitamin and mineral fortification. Close behind was easing indigestion and nausea (32%), providing an immunity boost (30%), aiding in weight management (27%) and enhancing heart health (26%).
There’s a growing focus on possible health benefits by smaller brands, much like Beemans’ original idea of the product being a digestive aid.
“A naturally positioned gum/mint boasting ingredients in consumer-friendly language could well resonate with consumers, particularly if it included natural ingredients that promised an added healthy attribute,” wrote the Mintel Group analysts.
“Given the functional nature of gum and mints, it makes sense that ingredients like green tea and other emerging ingredients may grow to be widely used in these traditional product categories,” said Schildhaus.
“This year we purchased a shipper of Simply Gum. It has been surprisingly popular, especially on the West Coast,” said Turgut. “It is a unique gum in the natural gum category. They have herbal flavors, such as ginger, fennel and lemongrass, to name a few.”
“We may even see growth in caffeinated and cannabidiol (CBD) formulated products to drive more upside,” added Yesway’s Gaskins. “Also, gum and mints have tight correlations with tobacco products, and as flavor bans impact vape sales, it could create an opportunity for more growth in the category to meet consumers’ preference for bold, minty, fruity and other flavors.”
Growing profits with BFY products, however, demand c-stores break away from traditional marketing approaches of discounts, multibuys and bundling gum and mints with other products. Bortner believes connecting with consumers through technology, such as smartphone apps, presents an opportunity for the category.
