New Products Drive Chocolate Sales

chocolateDespite a host of new product introductions and package sizes, chocolate SKUs are holding strong at convenience stores.

At Zarco 66, different product configurations and package types and sizes of long-time favorite brands are keeping the category fresh and appealing to a wide range of consumers, said Scott Zaremba, owner of the 10-store Kansas chain.

Zaremba believes that this product and package tweaking will continue over the next 12-24 months.

“Look at products such as Reese’s Peanut Butter Cups and Butterfingers, and you’ll see, in addition to the single serve and shareable bars, bite-sizes, bags and other variations of the same product,” he explained. “Some of these variations make for a higher ring, but they also take up more facings on the shelves.”
As this trend continues, it will be a growing challenge for category managers to keep up with what the newest hot items will be. It will also be a challenge to find space for new brands.

“With so many different chocolate candy options out there, what we carry—whether chocolate or non-chocolate—is going to be based on who is offering the best merchandising and advertising support,” he said. “For retailers, it is going to be about constantly reconfiguring sets and making sure the best sellers are always in stock. What’s being advertised at any given time is what consumers are going to want, so we’re going to continue to bring in shippers to coincide with they’re advertising.”

Reason for Optimism
According to data from Information Resources Inc. (IRI), chocolate sales in the convenience store channel reached over $2.5 billion last year, up 5% over 2012. The lion’s share of those sales, over $2.1 billion, up 3.7% over 2012, came from candy bars and boxes less than 3.5 ounces. Candy bars and boxes greater than 3.5 ounces brought in more than $312 million, up almost 13.8% over 2012.

Zaremba pointed out that compared with all of the new introductions in chocolate, he has not seen much movement in non-chocolate confections. Some of the big brands have gone to bags, he said, but few are doing much promotion. Because of this lack of momentum, some spaces once occupied by non-chocolate items are now being used for chocolate products at his stores.

IRI reported that non-chocolate candy sales in convenience stores reached close to $1.9 billion in sales, up close to 4% over 2012. Leading the pack is chewy candy, such as Skittles, Starburst and Sour Patch Kids, which accounted for $132 million in sales, up 6% over 2012.

Coming in second were novelties, led by Wonka Sweetarts and Nerds and Topps Baby Bottle Pops, at $188 million, up 3.85% over 2012. Licorice in boxes and bags brought in $132 million, up 3.84%. Hard sugar candy in packages and rolls dropped to $99 million, down 3.45% from 2012.

“Non-chocolate candies are going to have to do reinvent themselves if they want to vie for shelf space with the chocolate products,” Zaremba said. ◆

Chocolate/Non-Chocolate Candy Sales Up

According to data from Information Resources Inc. (IRI), chocolate sales in the convenience store channel jumped past $2.5 billion last year, up 5% over 2012. Meanwhile, total non-chocolate  sales were up close to 4% with $1.86 billion in sales.

                                       Dollar Sales      Sales % Change    Unit Sales    sales % Change       Avg. Unit Price
Total chocolate             $2.55 Bil                   5.02                  1.82 Bil               1.31                         $1.40
Total Non-chocolate    $1.86 Bil                  3.96                   1.51 Bil               (1.43)                       $1.23

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