Sugar confectionery: The heat is on

Sunshine and sugar confectionery go hand in hand, and with 40% of sweets sold through convenience stores, it’s key that you ensure the fixture is looking its best for the summer months.

“While many might not see it as such, summer is definitely a season to consider in the confectionery calendar,” says Hancocks purchasing director Jonathan Summerley. He advises retailers that as well as honing in on specific opportunities depending on their local shopper profile, they should put more emphasis on sugar confectionery and less on chocolate.

Chewits manufacturer Leaf Confectionery agrees. “There is a natural increase in sugar confectionery sales versus chocolate in the summer months, when warmer temperatures see consumers switching out of chocolate into lighter sugar confectionery products,” says trade marketing manager Joanne Carr. “It would make complete sense for convenience store retailers to review the balance of sugar versus chocolate ready for the peak summer period.”

Sugar confectionery buyers shop in a fundamentally different way to chocolate shoppers, observes Nestlé. Trade communications manager Graham Walker says: “Whereas chocolate is purchased mainly on impulse, sugar confectionery is sought out by shoppers who have a particular occasion in mind.”

And warmer weather means plenty of sugar confectionery consumption occasions. “Fruity sugar confectionery is the perfect companion for the summer weather,” says Wrigley communications manager Louisa Rowntree. “With the summer months come opportunities such as BBQs, picnics and gatherings at friends’ houses.”

Frugal shoppers

The economic climate is having a huge impact on the sugar confectionery market. “People are opting to stay in rather than spend money they can ill afford on going out,” says Tangerine executive chairman Stephen Joseph. Instead, consumers are choosing to entertain at home, which has led to an increase in sharing occasions, with sugar sharing bags up 1% to £214m in the convenience channel (IRI MAT Value Sales 52 weeks ending April 23, 2011).

The fact that consumers are counting the pennies has also meant that providing a value offering is vital. “Value is the key trend that is supporting the growth of the category,” says Haribo managing director Herwig Vennekens. “Haribo regularly reinforces value through price promotions that support impulse purchase, or in the case of new products, encourages trial.”

Haribo’s latest value offering is a three for £1 promotion on its 50g handy packs, which it is running alongside its existing £1 pricemarked 250g packs.

And Haribo isn’t alone in offering consumers value for money. Swizzels Matlow has introduced a range of mini hanging bags to be sold at 39p each or three for £1.

In a similar vein, Hancocks recently redesigned and relaunched its ‘three for 99p’ range of children’s bags, which are individually pricemarked at 39p.

“In the current climate, pricemarked bags are good for retailers to stock as consumers can clearly see price points and these often reflect good value for money, which is key to price-conscious consumers,” notes Perfetti Van Melle. All of the company’s bagged Fruittella products have a £1 rrp.

Nestlé has also developed £1 sharing bags for Rowntree’s Fruit Pastilles, Fruit Gums and Pick N Mix, which are specifically designed with the convenience channel in mind.

Popular lines from Cadbury including Bassett’s Jelly Babies and Liquorice Allsorts, and Maynards’ Wine Gums, Midget Gems and Sports Mixture also have £1 price flashes on packs.

Softly, softly

Soft eats continue to be the main choice of sugar confectionery for consumers, which has led to a ripple of change within the jellies market.

Haribo is the UK’s leading gums and jellies brand with a 25.8% value share of the total market. And the brand intends to stay front of mind throughout the summer with its Haribo Funtime campaign, which is targeting families via a mass sampling tour and the launch of a new web portal.

Cadbury’s The Natural Confectionery Company (TNCC) has also made a name for itself in recent years with its permissible message to parents. “Consumers are becoming more educated about the food they are eating,” says trade communications manager Susan Nash. “This helps to strengthen the sales of brands such as TNCC, which focus on providing products with natural ingredients.”

The brand has recently had a revamp with new characters creating further excitement.

Newcomer Goody Good stuff is offering an equally virtuous concept with its eight-strong gummy range, which includes Koala Gummy Bears and Summer Peaches. All sweets are “free from nasties” says managing director Melissa Burton.

Nestlé also has its eye on this fruitful market. “There is an emerging trend within sugar confectionery which sees customers moving away from the more traditional sweets, such as hard toffee and mint sweets, and towards softer fruit jelly sweets,” says Walker. “These fruit jelly sweets offer a fun, playful and engaging choice for sugar confectionery shoppers at the same time as offering a softer texture.”

With Rowntree’s Fruit Pastilles and Randoms the number one and two best-sellers respectively within sugar singles, the brand was well placed to make its debut into the family jellies market last in April. Rowntree’s new Very Berry Jellies, Sour Faces and Jelly Aliens all boast a market-leading amount of fruit juice (at least 25%) and no artificial colours, flavours or preservatives.

Another popular sweet brand making the transition into jellies is Perfetti Van Melle’s Fruittella. “Our research has shown that mums value the Fruittella brand ahead of other chewy brands and we aim to bring these values to the jellies market,” says Ladi Moradi, trade marketing manager for the impulse channel. “Our Fruittella brand has a strong positioning on the market as a natural product with no artificial colours or flavouring, which is the strength we are capitalising on.”

She states that there is enough flexibility within the market for multiple brands to survive. “Jellies are the most frequently consumed sugar confectionery product in the UK market, so with the great variety of shapes and sizes possible there is plenty of room for several companies to be present there.”

However, Hancock’s Summerley isn’t convinced there is room for so many brands within one area. “Many brands have jumped to take advantage of the growing jellies market,” he notes. “I would predict that many will fall by the wayside as time goes on.”

Judgement call

In a sector bursting with NPD, it can be tempting for brands to try out new formats, but even well established brands can spread themselves too thinly. Last year Starburst’s sales slumped 18% to £21m when the brand over-stretched itself. “The brand has suffered from a proliferation of brand extensions and flavours and this has consequently confused retailers and consumers,” says Wrigley’s Rowntree.

However, it was a lesson well learnt, and Starburst has bounced back by dropping a number of SKUs and focusing solely on core lines: Starburst Fruits, Smoothies and Tongue Tangles. This has helped sales increase to £22m. “New flavours and variants generate interest and trial, but one approach doesn’t fit all and we have recognized that streamlining the Starburst range was the best option,” says Wrigley’s Rowntree.

But just because a supplier has to learn about brand dilution the hard way doesn’t mean that retailers have to suffer, so long as they are quick to react to sales peaks and troughs. “Retailers should look to enjoy NPD activity, and benefit from short- to medium-term boosts in sales,” says Summerley. “While some big launches continue to offer strong sales for a long period of time, others will have a surge in sales for a short while and then settle at a lower level. Retailers should react quickly to benefit from the high sales periods. While new products help to take the market forward, the shoppers themselves will ultimately decide which varieties and brands are of relevance to them.”

For some brands, having numerous SKUs can result in reducing their impact, but for others it seems the more the merrier. “Panda offers the largest selection of liquorice in the UK with 18 products in the range,” says Lisa Gawthorne, managing director at Bravura Foods, which handles sales for Panda Liquorice. “Many would say this is madness, but consumers love the choice.”

The company has just launched a new blueberry variant to meet demand for healthier snacks.

With new products essential to the category, it is imperative that retailers keep their eye on the ball. But only you can know the correct range for your store.

“There are no hard and fast rules when it comes to the ratio of stocking new versus existing sugar confectionery in your range,” says Carr. “It’s all about finding the right balance it is important to ensure you are stocking the firm favourites that consumers love, mixed in with some new and exciting sweet products which will offer them something different.”