Help Them Indulge

While consumers exhibit some degree of tolerance when it comes to chocolate confectionery price increases, 43 percent of chocolate buyers say they would trade down to lower-priced options if the price of the products they typically purchase increased by 25 percent or more, reports global market researcher Mintel in its April “Chocolate Confectionery — US” report. And 21 percent said they would buy less chocolate candy altogether if chocolate were to be hit with such an increase.

For retailers that offer store brand chocolate confectionery, these consumer data could be enlightening. With cocoa prices reaching $3,025 per ton in March, the highest level in two and a half years, according to “Chocolate Candy in the U.S.,” a July report from the Packaged Facts division of Rockville, Md.-based MarketResearch.com, price increases might prompt consumers to try more store brand chocolate products. But just offering a lower price won’t be enough; retailers also will need to offer fun, indulgent and healthful products to convince consumers to purchase.

Where health and flavor meet

When it comes to chocolate, consumers are open to — and looking for — creative and exciting new products, Packaged Facts reports. Often, these same consumers are also looking for more healthful options. In recent years, this trend had led to an uptick in unique inclusions that are appealing to consumers on both a flavor level and a health level.

“Superfruits were very popular and on trend a few years ago,” says Mark Bruno, vice president of sales, Wolfgang Candy, York, Pa. “But I think that consumers have gotten somewhat tired of them. Now I’m seeing combinations of fruits or rare and exotic fruits coming to market.”

Additionally, retailers could look beyond fruit to quinoa and chia seed inclusions, he says.

“Mars and Hershey aren’t playing in the [chia seed and quinoa] arena yet,” Bruno adds. “This allows retailers to offer something unique and different and innovative to consumers that the big brands can’t or aren’t yet offering.”

In previous years, “healthful” often meant sugar-free, but that no longer is the case. Sugar-free chocolate has seen recent declines in sales, indicating that many consumers have become skeptical about sugar substitutes and often feel that natural sugar is better than sugar alternatives, Mintel reports. However, consumers overall are still moving toward sugar reduction, and the trend will likely continue to affect the chocolate confectionery segment.

Additionally, retailers and consumers might not be aware that many of these chocolate and candy products could be considered all-natural, says Michael Swiatkowski, vice president of sales and marketing for the American Confections Co., Columbus, Ohio. For some consumers, if they can’t buy organic, they might be satisfied with all-natural, and retailers should include this callout on the packaging.

Packaging that stands on its own

Packaged Facts reports that 44 percent of chocolate candy buyers purchase chocolate candy that comes in a stand-up pouch. For retailers, an important positive to this packaging is that it creates a clear shelf presence at retail, allowing considerably more presentation of the product image versus flat bags.

For consumers, resealable stand-up pouches are all about hand-to-mouth snacking, Bruno says. Hershey was the leader in this packaging format, and now manufacturers are converting their most popular items to this packaging type to capture this usage occasion.

In addition to stand-up pouches, tubs could be a winning packaging solution, says Barry Rosenbaum, president of Hicksville, N.Y.-based Nassau Candy. “Consumers like to see what they’re buying, and the product is completely visible in the tub,” he says. “Plus, it merchandises very easily at the store level in terms of stackability and neatness. Some tubs even have residual perceived value to the consumer as they believe they can use the tub for other things after the edible portion has been consumed.”

Whether it’s a stand-up pouch, a tub or some other packaging type, the graphics used on the packaging remain incredibly important. Leslie Sabino, category and supplier lead – confectionary for Stamford, Conn.-based Daymon Worldwide, recommends that graphics be used to entice the shopper with a playful personality or a decidedly high level of fun and excitement.

“Colorful and playful graphics directly relate to the inherent characteristics of the category: fun, exciting, playful, sweet treat, indulgent, rewarding, impulsive and special,” she says. “The best and most popular packaging for everyday candy uses bright, saturated colors that trigger an impulsive and emotional notion.”

Richard Griseto, vice president of sales and marketing at Chicago-based Primrose Candy Co., agrees. Retailers should avoid boring packaging and boring products. Candy and chocolate is supposed to be fun and exciting! Remember the excitement a child has when she receives her first special sweet treat? Retailers should strive to recreate that pure and innocent excitement each time the consumer purchases a candy or chocolate product.

Additionally, when it comes to packaging design, consumers have to be able to understand the product in a split second, says Richard Warrell, vice president of sales and marketing, branded and private label for The Warrell Corp., Camp Hill, Pa. Many specialty products in the candy and chocolate category fail when consumers fail to connect with them. To be successful, retailers must first focus on the product and understand which consumer is going to buy it, how they are going to eat it, and what problems the product solves for the consumer.

Retailers might also want to use the packaging to address consumer health concerns, Bruno says. For example, some industry experts have brought up the idea that the package could communicate to consumers that to burn off the calories in one serving, they would need to exercise for a set number of minutes. This messaging allows the consumer to indulge without a lot of guilt.

The ultimate impulse purchase

But even with the most healthful inclusions and the most appealing packaging, chocolate — more often than not — is an impulse purchase rather than a pantry staple.

“All of confectionery is impulse,” Rosenbaum says. “Merchandising the product only in the candy aisle is insufficient to really develop the category. There has to be a lot of off-shelf high- traffic displays of the candy throughout the store because the more times they see the confectionery, the more likely they will buy it.”

Plus, taking store brand candy and chocolate out of the center aisles will help shoppers recognize not only the product, but also the brand, Warrell says. And when a retailer is looking to introduce a new chocolate product, it should do it during the holidays. That’s when people are looking to offer their guests something fresh and different, so they will be more likely to try something new.

Do consider healthful inclusions such as chia seeds and quinoa for store brand chocolates

Don’t ignore consumer concerns about sugar-free products.

Do engage adults with sophisticated candy flavors and functional benefits.

Don’t merchandise chocolate and candy only in the aisle; merchandise it throughout the store.