Sweet treats that won’t break the bank are in demand, says Sarah Britton, with lighter bites and those designed for sharing leading the pack
Times might be tough, but there remains plenty to smile about in the chocolate category. Still very much an affordable treat, the market is now valued at £3.6bn, up 2.1% year on year, according to Mars. The bars segment in particular has seen a strong performance over the past year, up 4.7% in 2011, notes the company. “The convenience landscape is increasingly competitive, but there are some straightforward ways that retailers can give their store the edge and maximise sales potential,” claims trade communications manager Bep Dhaliwal. “Understanding shopper behaviour is a key part of that for instance, offering a tailored range that caters to shopper needs.”
FAST FACT: £3.6bn That’s how much the chocolate category is worth, according to Mars.
There’s no question as to which particular consumer need state Snickers is aiming to fulfil with its latest campaign, supported by an £8.1m media spend. Entitled ‘You’re not you when you’re hungry’, the £62.7m brand’s humorous ad, featuring eighties icons Joan Collins and Stephanie Beacham, markets the product as the ultimate treat for hungry men.
Another hunger filler using comedy to capture people’s imaginations is Kit Kat Chunky. The brand has been causing a storm with its Choose a Chunky Champion campaign, which enabled consumers to vote for their favourite flavour from four limited editions to become a permanent line. A £6m media campaign involving a host of comedians ensured that the brand spoke to its 18- to 30-year-old male target audience. Retailers would be wise to stock up on winning flavour peanut butter, which received more than half a million votes and is available to order from April 16.
While blokes go barmy for belly-busting bars, there’s plenty of demand from the opposite sex for chocolate that provides the pleasure factor without the extra calories. Never one to miss a trick, Mars has met this demand with new limited-edition Galaxy Flutes. The crispy wafer bars carry the strapline ‘Lightness you’ll love’. The Galaxy brand is currently valued at £200m, and will be supported by a £15m ad spend in 2012. Dhaliwal says: “Limited-edition launches continue to inject variety and excitement into already established brands, as well as attracting new customers to the category.”
But Flutes aren’t the only light bite vying for consumers’ attention. Ferrero has its finger on the pulse with top 15 countline Kinder Bueno. Ferrero customer development director Levi Boorer claims the product offers the “best of both worlds” by being both pleasurable and permissible. The bar has recently been on TV with a new strapline ‘Indulgence, lightly done’. This is being supported by an engaging ‘try me free’ on-pack promotion, which has so far seen Classic Bueno sales rise a hefty 17%.
Not wanting Aero to get lost in the rather crowded lighter bars market, Nestlé Confectionery has given the Aero mould a makeover and last month launched a bubble-shaped bar for the singles category. “Aero’s innovation isn’t just for show,” says trade communications manager Graham Walker. “The new design sees the bar divided into 10 easily snappable ‘bubbles’, making it less messy to eat and more portionable.”
An Aero orange single has also been added and is half-way through its limited-edition 12-week run.
Kraft Foods has also joined the bubble brigade with new Cadbury Dairy Milk (CDM) Bubbly. Moulded into bubble-shapes, the aerated chocolate block is being supported by a £6m marketing campaign aimed at its female target audience.
Matthew Williams, marketing activation director at Kraft Foods, says: “Research shows that consumers see block chocolate as very safe and traditional, but this also means that some can see it as a bit functional. The launch of CDM Bubbly aims to inject excitement into the category by introducing a dynamic and quirky new way to eat tablet chocolate. Initial trials have been extremely successful.”
Large block chocolate provides a great opportunity for sharing with friends and family, adds Kraft Foods communications manager Susan Nash, who values Cadbury branded total large block chocolate at a massive £174m.
Another block launch aimed at the sharing occasion is Nestlé’s Rolo block, available with a £1 flash, as well as in non-pricemarked packs. On sale for retailers to order from April 2, the 100g block takes on a Rolo shape. “As at-home consumption and the sharing occasion grow, it is the independent channel that has taken greatest advantage of the opportunity with strong growth in blocks in the past year - up 11% in value sales,” says trade communications manager Graham Walker. Sales of Nestlé’s £1 blocks range grew 62% in value in independents during this time.
Mars is also responding to the sharing trend. “With shoppers looking to entertain at home and save money, the sharing and Big Night In trends look set to grow,” says Dhaliwal, who claims that Mars’ Bitesize products match these trends. “Retailers are advised to stock up on sharing products, with recent research having shown that almost 15% of all UK households are now turning to in-home leisure as a direct result of the economic downturn,” she says. “In-home leisure expenditure is set to keep growing at a steady pace for the next 10 years and this is having a direct impact on the growth of the sharing confectionery market.”
Bitesize is also a popular format at Kraft Foods, which recently added Bitsa Wispa and Cadbury Twirl Bites to its bags portfolio. Just 22 weeks after its September launch Twirl Bites were worth £11m. “The success of this launch is thanks to the trend for Big Nights In, and the way these formats offer consumers a new way of sharing,” says Nash. “The chocolate bags sector is performing very well, experiencing 4.7% growth, and Cadbury branded chocolate bags alone are worth more than £82.4m, up 26%.”
Among all the new kids on the block, retailers shouldn’t overlook the old-timer, boxed chocolates, given a new lease of life as a sharing option. Says Boorer: “There has been an increase in ‘just because’ moments, where treats such as Ferrero Rocher and Ferrero Collection are viewed as an affordable luxury. Brands like Ferrero can provide higher value sales opportunities than traditional snacking and confectionery in the Big Night In display.”
The firm plans to double the size of its UK business in the next five years by investing in support on TV and in-store to deliver this. “The convenience channel will be key to us achieving these goals,” says UK sales director Jason Sutherland.
As well as accommodating consumer’s various need states and consumption occasions, suppliers have been tapping into a less tangible, but unmistakable, demand for escapism. In the current economic climate consumers are looking for a chance to forget their woes and CDM has just the ticket with its new Joyville creative, which allows people to escape reality for a few precious seconds and buy into Cadbury’s zany Wonka-like world.
Its January ad saw Joyville workers appearing from pipes and holes, and floating into the sky to distribute chocolate bars to the people below. And this is just the beginning of the crazy capers as Joyville is set to become a long-term campaign.
Mars is also offering consumers a chance to escape, but in a more literal sense, with its Galaxy Win A Million Moments campaign. The brand’s biggest ever on-pack promotion gives consumers the chance to win from a prize fund of more £13m, with rewards including manicures and lunch in Paris.
“Promotions such as these offer traders the opportunity to communicate extra value to shoppers, especially as consumers are continuing to think carefully about spending,” says Dhaliwal.
It’s no good manufacturers pouring money into the category if retailers don’t adopt best practice in terms of range and merchandising. As more than 50% of confectionery purchases are made on impulse, it is key that the products are clearly visible, states Kraft. “Double facing key products enhances visibility and attracts the attention of shoppers, using brands that they instantly recognise,” says Nash.
Retailers should examine which of the lines they stock add value every day and delist poor performers as a matter of course, advises Mars. Once the main display has been sorted, retailers should look to implement secondary confectionery sites throughout to drive those impulse sales, says Dhaliwal.
She is confident that the future of the chocolate category holds plenty of promise for retailers who put the work in. “This valuable category offers unrivalled sales opportunities for retailers if they take advantage of the category insight and range advice that is available to them.” •
ONES TO WATCH
Mars is hoping to cash in on the buzz surrounding the UEFA European Football Championships with promotional packs of Mars Bars. English consumers can win one of 100,000 special-edition shirts, while Scots can snap up Sports Direct vouchers. Activity will be supported by £4.3m spend.
tel: 01844 262517
Mum’s the word
A new TV creative for Kinder Kids is due to hit screens in mid April, to communicate the product’s attributes to mums. “When it comes to kids’ confectionery, mums are looking for appealing treats with portion sizes they can control,” says Ferrero customer development director Levi Boorer.
tel: 01923 690 300
A lighter note
The latest offering in the lighter bites segment, chocolate and wafer creation Galaxy Flutes, is set to appeal to those wanting the luxury of chocolate without the guilt. Tailored display units are available. The firm is spending £15m supporting the Galaxy brand in 2012.
tel: 01844 262517
New to Hancocks is Hibbi the Hippo chocolate. The range comprises four-pack bars in strawberry, banana, cream and popping candy flavours (rrp 39p); eight-pack bars in strawberry and cream (rrp 75p); 100g white and milk chocolate bars (rrp 59p); and aerated bars in white and milk chocolate (rrp 59p).
tel: 01509 216 644
Available in both milk and white chocolate variants (rrp £1.42), Cadbury Dairy Milk Bubbly is made with aerated chocolate, offering a lighter alternative to standard bars. The milk chocolate variant is also available in a £1 pricemark pack. The bars come in shelf-ready outers with a built-in pusher.
tel: 08702 400 861
Having the right range and display is absolutely essential if retailers are to maximise the sales opportunity around the chocolate category, says Ferrero customer development manager Levi Boorer. He has these tips:
● Don’t be drawn by deals and cheap prices at the wholesalers as they offer a false economy. The best-sellers will provide a greater rate of sale
● Ensure you keep your shelves full and well-organised so that customers can find what they are looking for
● Be aware of which brands are being heavily supported with marketing as this will drive consumer awareness, which you can translate to sales
● Create secondary displays in high-traffic areas to generate impulse purchases. Using bespoke pos helps create in-store theatre and catch attention
“Chocolate is performing well. Nisa gives us sharing bag offers every three weeks, and we’re seeing strong sales of Cadbury Dairy Milk Buttons and M&Ms peanut. We’re also seeing £1 Milkybar and Aero peppermint blocks do well.
“When Nestlé launched the limited-edition Kit Kat Chunky we bought a box of peanut butter and a box of white chocolate and both sold out in two days - some customers came in every day to buy them! We’ll definitely be buying the peanut butter ones again soon.”
Ketki Patel, assistant manager, Weyhill Stores Nisa, Andover