Spotlight on candy and chocolate

Store brand candy has been in a growth mode of late. Data from New York-based Nielsen show that U.S. private label dollar sales rose 4.5 percent during the 52 weeks ending March 16 to reach $664.1 million, while unit sales climbed 5.7 percent during the same timeframe (all outlets combined).

Although product development and innovation likely will be critical to store brands continued success here, merchandising also will play a key role. We visited three retailers to see what they are doing to make their own-brand candy (including chocolate) stand out: a Schnucks store (operated by Schnuck Markets Inc., St. Louis) and a County Market store (operated by Quincy, Ill.-based Niemann Foods) in Champaign, Ill., as well as The Fresh Market store in Kildeer, Ill. (operated by The Fresh Market, Greensboro, N.C.). Our visits took place in mid-April.

Schnucks
General observations: The candy section in the Schnucks store is situated toward the left-hand side of the store (looking into the store from the front entrance). The candy section takes up most of a short aisle that extends to the back of the store. Store brand products consist mainly of 20-plus non-chocolate SKUs of Schnucks Sweet Shop branded candies – in bags that hang from hooks – that run the gamut from repackaged national brand items (e.g., Tootsie Rolls and Smarties) to Cherry Sours and Cinnamon Bears. They are situated to the right of some hanging national brand candies.

The section was neat and well-stocked. Foot traffic was moderate during our Sunday morning visit.

The upside:

• The store featured a wide assortment of Schnucks Sweet Shop candies and advertised the products \"10 for $10\" sale price with prominent on-shelf signage.
• To support the \"10 for $10\" promotion, the store dedicated an entire end cap to the Schnucks Sweet Shop candies. A large sign communicated the discount.

The downside:

• Although the store also was merchandising selected Schnucks Sweet Shop SKUs at the checkouts, the signage did not reflect the promotional pricing.

County Market
General observations: The candy section in the County Market store is located toward the left-hand side of the store (looking into the store from the front entrance). It takes up the whole left side of a short aisle located toward the back of the store, as well as part of the other side of the aisle. Store brand items are offered under the Essential Everyday brand (supplied by Minneapolis-based Supervalu) and include more than a dozen SKUs of non-chocolate candies (such as Gummi Bears, Orange Slices and Candy Corn) and four SKUs of chocolate items (Bridge Mix, Chocolate Covered Almonds, Chocolate Covered Peanuts and Chocolate Covered Peanut Clusters). All of the products are packaged in bags that hang from hooks; they are situated in between some Brachs and Wonka brand candies on the left side of the aisle.

It is worth noting that in addition to its store brand candies, this County Market offers the Island Snacks value-oriented national brand and gives that brand a large number of facings on the right side of the aisle. The store was neat and well-stocked. Foot traffic was light during our Sunday morning visit.

The upside:

• Like the Schnucks store, the County Market store was offering its store brand candies (including chocolate items) at a \"10 for $10\" discount. Prominent on-shelf signage communicated the discount.

The downside:

• We did not see any secondary displays for the Essential Everyday candy.

The Fresh Market
General observations: At The Fresh Market store, candy is merchandised on a number of large free-standing display units toward the front of the store, as well as in baskets at the front of the store. The placement is very attractive and gives the area somewhat of a \"candy store look and feel.\" However, most of the items are from upscale national brands (e.g., Godiva, Lindt, Sees Candies). The Fresh Market (TFM) branded products are limited to bulk candies housed in old-fashioned jars (sold by the pound) and select chocolate items.

The store was neat and well-stocked. Foot traffic was moderate during our Monday afternoon visit.

The upside:

• At the checkout, the store was merchandising 1.2-ounce TFM Bittersweet Chocolate Bars. Large signage communicated the promotional price of \"4 for $5.\"
• Baskets placed at the checkout counters held several varieties of 3.5-ounce TFM Chocolate Bars. Large signage communicated the promotional price of \"2 for $6.\"

The downside:

• By separating the candy/chocolate into so many small areas, the store might make it more difficult for shoppers to locate the products they want. (On the other hand, the product placement also could encourage shoppers to browse longer and buy on impulse.)

Find the sweet spot
When it comes to showcasing store brand candy and chocolate, retailers have many options. For example, floor stand, shelf pack and sidekick displays help spur trial and boost sales, says Mike Salerno, director of Continental Confectionery Co., a joint venture between Denmarks Gumlink and Turkeys Yildiz Holding.

\"These are vehicles that national brands use for impulse sales, and store brands need to use more of them,\" he says.

Promotions also are critical to boosting sales, notes Anjali Bonfante, who handles North American sales for Agostoni Chocolate, Los Angeles.

\"We have seen successful sales in the category with consistent promotions on items and BOGOs to lure in new customers to try private label ... chocolate,\" he says. \"The smaller-size chocolate bars – 1.2-ounce – are also a great item for store samplings and promotions.\"

Innovative packaging can attract attention to store brand candy, too, Bonfante says.

\"Research indicates that the first purchase is based on the packaging, and the second purchase of an item is due to the consumer liking the product,\" he points out. \"Additionally, we have seen shifts from 3.5 ounces to 3 ounces in chocolate bar sizing and more interest in carton-style packaging versus envelope wrapper packaging.\"

For lower-end \"classic-type\" candies, though, \"the simpler the package, the better,\" says Jack Praino, CEO of Woodinville, Wash.-based World Wide Gourmet Foods Inc. Here, clear plastic bags and tubs work well to immediately communicate to the shopper the type of candy inside.

\"For higher-end gourmet candies, the trend has been toward opaque packaging,\" he notes, \"typically with either a photographic or illustrated representation of the product. The hooks for these products are typically textually based – usually in the name of flavors: Dark Chocolate Salted Caramels, Fair Trade Milk Chocolate Bar, etc.\"