Christmas confectionery: Deliver on time

Kids across the land are sent into a frenzy at the very mention of Christmas. And convenience retailers should be feeling much the same as demand for confectionery goes through the roof. “Christmas confectionery remains a key category for retailers, accounting for 51% of the £1.2bn seasonal confectionery sales,” says Nestlé trade communications manager Graham Walker. “It is also a growing area of confectionery, with sales up 14.7% over the past five years.”

The key to getting it right is to plan ahead, claims Hancocks. “You cannot be too early when planning Christmas,” says purchasing director Jonathan Summerley. “Retailers who leave it too late will only do so once and then realise that they didn’t make the most of a great opportunity.”

With regard to getting stock on display, Summerley recommends that retailers introduce seasonal impulse treats from early September.

Early winners

“Perhaps originating back to the Creme Egg, the seasonal impulse treats category has opened up a whole new revenue stream for retailers,” he says. “And given the low cost and impulsive nature of the category, it’s great news for smaller independent retailers who thrive on impulse.” The firm has a vast array of impulse treats, including Christmas Jelly Pops (49p) and Christmas Chocolate Pops (79p).

Seasonal impulse confectionery should be the number one area of focus at Christmas for convenience retailers, adds Walker. “With sales incremental to all-year-round singles confectionery, it is the novelty of these products that attracts shoppers. They also act as a signpost for the Christmas season in store and therefore visibility, especially in the early season, is key to maximising sales.”

In fact, early season sales account for a quarter of all seasonal impulse sales, with a quarter of shoppers who buy early repeat purchasing, claims Nestlé. “These early season shoppers are extremely valuable to retailers as they also spend on average 23% more than shoppers who only buy later in the season,” adds Walker.

The company’s best-selling Quality Street (QS) My Purple Bar is back for another year, and this time it will be joined by My Green Bar (rrp 65p). Aimed at adults, the bar combines hazelnut praline with milk chocolate.

The brand is also giving its name to a mini carton (rrp £1). “Sales of mini cartons saw huge growth in 2012 and are the perfect mini treat shoppers can buy for themselves or others, as well as the ideal size for a stocking filler,” claims Walker.

And for kids, Nestlé’s Smarties Little Choc Penguin is returning to shelves, with its equally cute white chocolate counterpart, Milkybar Polar Bear Cub (rrp 65p). “Retailers can generate incremental sales by locating Christmas impulse lines at the till,” highlights Walker. “The Smarties Little Choc Penguin and Milkybar Polar Bear Cub both come in eye-catching 24-count display outers that shoppers can’t miss.”

Plenty of new products for the seasonal opportunity have been developed by Mondelēz International too. For example, Cadbury Dairy Milk (CDM) Freddo Popping Candy (rrp 20p) is set to appeal to children in the run-up to Christmas.

The firm is also launching a Cadbury Dairy Milk (CDM) Mousse Snowman (rrp 65p), featuring a vanilla mousse filling encased in chocolate, and festive favourite Cadbury Wishes will be back for another year, with 10% of all profits being donated to the Make-A-Wish Foundation.

Mars hopes to make its mark with the new Merryteaser (rrp 65p), a reindeer-shaped treat which is similar in texture to the popular MaltEaster Bunny, and a white chocolate variant of its Galaxy Gift For You treat (rrp 65p). “The self-treat category will be crucial to 2013 Christmas,” says Nicola Lacey, central sales director, Mars Chocolate UK. “This category thrives throughout other seasons, such as Easter, and we believe that there is an opportunity for retailers to build on this at Christmas, too, with our new fun and innovative range additions.”

Premium treats for self-indulgence are also a growing opportunity, up 18%, according to Ferrero. “Products such as the Rocher five-pack, which has grown 84% year on year, will sell well even before the festive period starts and help to unlock this opportunity,” says sales director Levi Boorer. “Ferrero’s research shows that treating yourself is a relatively emotionally involved purchase which results in a higher basket-spend, creating a value driving opportunity for the category.”

New for this year are compact gold counter-top units in two sizes: one small enough to contain Rocher and Raffaello three packs, and slightly larger units for stocking the Rocher five-pack. “Secondary display units are key for raising visibility and maximising the highly impulsive nature of confectionery purchases during the festive season,” says Boorer. “Even our small gold hook-over units which can be clipped on to a card fixture or wines display, and which contain the Rocher five-pack, can increase basket spend by driving cross-purchase as a small gift. Consumers often go to convenience stores with a problem in mind and POS like this can help to solve it.”

It’s a novelty

As the season progresses, small novelty items and stocking fillers can start making their way on to your shelves. “Sales of novel confectionery gifts have grown significantly in recent years and it’s important for retailers to ring the changes every year and find something different to shout about,” says Hancocks’ Summerley. Consumers looking for something a little quirky may be drawn to Hancocks’ sweetie- laden Wooden Reindeer Sleigh or Barking Plush Dog (both rrp £4.99).

“Novelties is one of the most profitable areas within confectionery and it’s also growing, with 500,000 new households buying into the segment in 2012,” states Walker. Nestlé is spreading its wings this year with new Smarties Robin and Milkybar Snowy Owl hollow characters (rrp £2.07).

Another character set to appeal to children is Kinder’s foil-wrapped Santa (rrp £2.50). Revamped for 2013, the figure will now be Kinder Surprise-branded and include a toy inside. The Kinder Seasonal range grew 138% last Christmas and contributed to 10.5% of category growth, claims Ferrero.

The firm is also confident that its Kinder Chocolate Minis tubes will be a recurring hit. It claims that tubes were a particular growth area for the kids’ market in 2012, up 28%, with the Kinder Chocolate Minis tube growing ahead of the market, up 64% year on year.

Nisa has also seen success with the tube format. According to Nisa business manager for confectionery David Stokes, tubes were an especially strong area for the group last year with growth of 60.1%.

This year Mars has introduced two new tubes - M&M’s and Mars twist wrap. In addition, Milky Way tubes have been updated, now containing individual twist-wrapped sweets, enabling them to be easily shared.

Nestlé observes that 90% of giant tubes purchases are incremental. Its Rowntree’s, Smarties, Rolo and Munchies brands will all be available in tube format for 2013. This Christmas the firm is super-sizing some of its most popular treats to create new novelty gifts, including the Smarties Supertube, which contains eight individual tubes of Smarties and retails at £4.50.

In addition, two QS novelties are set to cause a stir. QS Purely Purple Ones and Totally Toffee Fingers (both rrp £6) deliver consumers’ favourite sweets in eye-catching giant sweet packaging.

The company has also come up with creative packaging for Yorkie bars to help consumers cater for ‘hard-to-buy-for men’. The Yorkie Spirit Level retails at £4 and contains six full-size bars.

Another packaging innovation set to add interest over Christmas is Ferrero’s new Mini Cube. Available for both Ferrero Rocher and Raffaello, the smart boxes are decorated with bows and retail for £2.99.

Also feeling festive is Terry’s Chocolate Orange from Mondelēz International, which is introducing special seasonal packs and a new variant. A white ball will be joining the dark, milk and exploding candy Oranges for a limited period. The brand will also be available in bitesize format with limited-edition Terry’s Chocolate Orange Minis.

Toblerone will take on an equally jolly tone, with packs decorated in Christmas lights, snow and Santas.

Not wanting to miss out on the fun, CDM bars are also receiving a Christmas makeover - as is the rest of the Cadbury seasonal range. All packs will feature a knitted pattern as a nod to the big trend for Christmas jumpers in recent years.

A new sharing bar will also feature in the CDM line-up. The limited-edition Winter Wonderland tablet is made of white and milk chocolate tree-shaped chunks, rrp £1.49.

The gift of Christmas

During November and December, sharing and gifting really starts to take off, and you can incorporate these offerings into your display. Twist-wraps remain an ever-popular proposition, and although it is no secret that competing with the multiples on tubs is nigh-on impossible, twist-wraps are still a good solution for distress purchases, provided that you stock the right pack format.

Mars’ Celebrations are available in large, small and mini cartons, and the £78m brand is currently benefitting from a £45m media spend.

Another big name in this arena is QS and its 350g gift cartons are a good solution for the convenience channel’s distress shopping mission, claims Walker.

And for something a little different, he suggests the QS jar (rrp £5.05), which saw sales growth of 45% last year and accounted for 60% of all jar sales.

Nisa’s Stokes agrees that jars have potential. “At Nisa we feel that the growth in jars, pouches and boxed chocolates last year was due to the great value they offer, as well as giving extra choice for consumers away from the traditional tins, which are being reduced in size every year to meet the maximum £5 retail that prevails in the market place.” The group reported that gift jars and pouches grew 29.9%, while boxed chocolates were up 12.9%.

Boxed chocolates from Ferrero and Lindt sold especially well last Christmas, with sales up 13% and 27% respectively. “Shoppers have been trading up from lower value sectors of confectionery such as twist-wraps into more premium boxed chocolates such as Ferrero Rocher and Ferrero Collection,” says sales director Levi Boorer. “For us it’s about understanding that consumers don’t want to go half-price on a special gifting product.”

Last year Ferrero had the number one media share of voice in food over December for a third consecutive year, which saw sales climb to £33m. Best-sellers were the Ferrero Rocher 16- and 24-packs, but the Ferrero Collection brand also performed well, growing 20%.

Ferrero will be back on air in the run-up to Christmas with a £6m spend to highlight Ferrero Rocher and Collection as ideal for special sharing and gifting moments.

Alternative options

“Consumers are actively seeking out affordable premium options for gifts,” notes Jo Kilinder-Smith, sales controller for Elizabeth Shaw, which offers an array of luxury boxed chocolates. “Despite the gloomy economy and the challenges this brings, it’s about offering consumers the right products for the right occasion.”

She claims that offering consumers a point of difference from the supermarkets is vital. “To maximise sales a varied offer is crucial and will help to set the retailer apart from the mainstream competition. It is difficult for retailers to be able to compete on some key lines, so mix it up and vary your stock from your key competitors.”

Bonds Confectionery concurs. “Convenience retailers are out-gunned on price by the supermarket chains when it comes to products from companies such as Cadbury, Nestlé and Ferrero at Christmas,” says managing director Philip Courtenay-Luck. “Our Mini Victorian Jars are a favourite for those ‘Secret Santa’ purchases and as affordable gifts with a point of difference. These are not found in the supermarkets and therefore give a great opportunity to gain seasonal impulse sales for convenience retailers.”

Hancocks agrees that defining your offering from competitors is key. “Many shoppers are happy to sway from the core brands and consider something lesser known or own label if they are happy with the quality, presentation and price. Christmas is an expensive time of year for us all and the pressure that we have experienced on household budgets has broken many long-standing habits,” says Summerley.

New from Hancocks in 2013 is a Vimto Sweet Selection Tin (rrp £5.99), which it describes as “a tin with a difference”.

Walker’s Nonsuch also offers something a little more unusual. Its hammer duo toffee packs are a tried and tested hit, and new for 2013 is a Luxury Toffee Selection Pack. Comprising real liquorice, roasted hazelnut, nutty Brazil and original creamy variants, plus a toffee hammer, the 400g packs retail at £4.50.

By offering a mix of best-selling family brands, premium boxed chocolates, and some inspiring alternative options, you can be sure that you offer something for everyone. And by planning ahead and knowing exactly when each product type will be introduced in-store, retailers can guarantee themselves a merry Christmas.

Nestlé advises retailers to play to their strengths. “The footfall driver for the mults is the tub. Some indies can sell it - it’s available in cash and carries - but in terms of giving indie retailers a focus on how they can win, stick to our advice,” says Walker. “For a successful season across the Christmas period, retailers need to offer the right range, at the right time, for the right shopper missions.”