Confections: The Comeback Year
Despite several weather challenges, shorter seasons and the continued quest for value among shoppers, 2013 was a “comeback year” for the candy industry.
The National Confectioners Association (NCS), Washington, recently released an in-depth confectionery performance review that found many improved metrics, including sales, trips, buyers and per-capita consumption, in addition to a strong execution of the four big seasons: Valentine’s Day, Easter, Halloween and the end-of-year holidays.
“In 2013, business was big, growing and profitable,” said Larry Wilson, NCA’s vice president of customer relations, in the report. “The total confectionery market reached $33.6 billion in 2013—marking the sixth consecutive year of sales growth. Chocolate is the biggest segment and grew the fastest, at 3.6% vs. 2012. Additionally, the outlook for 2014 and beyond is very positive, with accelerated growth for the chocolate and gum segments.”
Additional findings from the review include:
- Sales per capita improved 3.9% over 2011 to $106.19.
- Seasonal performance was strong, with an overall growth of 3.2% for candy.
- Halloween, the largest season, grew the fastest at 5.2%, followed by Easter and the end-of-year holidays.
- Chocolate indulgence was a winner, with white chocolate up 14%, followed by dark at 9%. Milk chocolate remains the largest segment and grew by $409 million in 2013. Chocolate combined with fruits and nuts is popular as well. Chocolate products containing almonds and hazelnuts, for example, grew 16%.
- Confection won more trips, and gains across channels included grocery, dollar and club. These channels also increased the number of buyers last year by more than 11 million.
Brand and mood lead the confection purchase decision tree, according to the NCA study, making variety (including new-item introductions) and regionality very important to growing sales. In 2013, retailers added on average seven new items across channels that generated $890 million in new-item sales.
“We predict continued growth for 2014,” said Wilson. “A longer Easter period and Halloween falling on a Friday this year signal an encouraging seasonal sales outlook. While the environment remains complex, the market holds many opportunities, including health and wellness.”
Holding true to that last point, the role of candy in a healthful diet was one focus of the 2014 Sweets & Snacks Expo in May, ranging from education opportunities to award tasting-panel participation by dietitians. Many exhibiting companies are planning new launches with health a priority through portion-control packaging and simple ingredient sourcing.
In a statement released by the company, NCA executive vice president Alison Bodor explained the association’s positioning: “Our increased focus on health and wellness highlights candy’s role in the diet as a treat and showcases what our manufacturers have done and continue to do as responsible companies.”