Easter looms on the horizon after Christmas, and with this year being the earliest Easter can be, it may catch retailers and consumers unawares, while Valentine’s Day and Mother’s Day may trip them up as well.
Mintel estimated the seasonal chocolate market at pound;420m in 2006, this equates to 14% of the UK chocolate market and 10% of the UK confectionery market. Seasonal chocolate attracts consumers to the chocolate fixture, creating eye-catching displays and stimulating consumer excitement and impulse purchase. For this reason, the sector is vulnerable to price erosion as retailers use the category for price promotion to drive footfall into stores.
According to Mintel men, more than women, appear to rely on the seasonal chocolate market for their gift needs. Chocolate may represent a ‘sure win’ solution and is not embarrassing to buy when compared to other gift markets such as lingerie and flowers.
Graham Walker, trade communications manager of Nestl eacute; Rowntree, suggests setting up a ‘special occasions’ fixture in depot, so that they can draw the retailers in. Having a separate fixture allows them to highlight Valentine’s Day, then Mother’s Day, then Easter and so on throughout the year. This can also encourage retailers to do the same in their stores.
Boxed chocolates are an obvious purchase for these occasions and wholesalers should make sure they are alerting retailers to the boxed chocolates available, including Black Magic, Heaven and Heaven Pearls.
Cadbury Trebor Bassett says both Valentine’s Day and Mother’s Day are in growth, and are now worth a combined pound;41m. Key brands include Milk Tray, Roses and Flake Moments. CTB says in order to further drive sales opportunities wholesalers should make availability and visibility a top priority. Key spring lines should be clearly displayed in-depot right from the beginning of January up until Easter to best meet retailer needs.
“These occasions are a key time for gifting, helping to re-engage shoppers with confectionery after Christmas, and the wholesale channel is essential to the beginning of this process. CTB research has shown that shoppers want to feel the occasion in-store as a reminder and inspiration to purchase, so this should be carried through into depot,” says Kate Harding, Cadbury Trebor Bassett’s acting head of customer relations.
Bendicks trade marketing manager Gabrielle Bond says: “Seasonal chocolate is important in driving footfall to the fixture and ideally they should place at least two sites in store – one for planned purchases within the usual boxed chocolate fixture plus strategically placed impulse fixtures at the end of aisles and close to checkouts. Boxed chocolates in particular are often last-minute purchases when shoppers realise they’ve forgotten a present for someone or want to add something extra to a gift they’ve already bought.”
According to Ferrero, while Easter remains the largest single gifting event, Valentine’s Day and Mother’s Day deliver 60% of the sales of the whole spring season, It is therefore crucial to have the right balance of range to satisfy the shopper and capitalise on sales of boxed chocolates at this time. In 2008, with Valentine’s Day on February 14 and Mother’s Day March 2, these two gifting occasions will be the closest together they have been for more than seven years. Based on previous evidence, the closer these events are together the bigger the sales opportunity.
Ferrero says it is still the number one gifting boxed chocolate and has maintained its share of fixture. The 200g box in particular shows a strong performance when promoted and therefore retailers should ensure consumers can access the brand at the right price point and in the right place.
Easter falls on its earliest possible date in 2008 with Easter Sunday being March 23. “It is really important to stock up early as this is the shortest spring season since 1913,” says Walker. “The biggest opportunity for small shops will be filled and mini eggs, which represent a massive 64% of spring sales and account for 21% of total impulse chocolate sales during this period. Wholesalers need to be building displays for these eggs before Christmas.”
Nestl eacute; has a range of new products in the filled and mini egg category, including the Smarties shaker egg filled with mini Smarties, and Milkybar shaker egg filled with white chocolate covered riceballs. For more indulgent filled eggs Nestl eacute; has a Heaven filled egg and a Black Magic filled egg. Mini eggs will also be available in Black Magic and Heaven.
Walker says: “Shoppers buy smaller eggs from brands they trust and Nestl eacute; recommends a tight range of favourite brands. The two top eggs being Smarties and Milkybar. A good focus for independents is the added value and premium range of eggs.” This includes the Aero Milk Bubbles and KitKat Gift Experience eggs which come with a gift certificate that can be exchanged for an experience, such as a round of golf or a facial.
The premium Heaven egg contains six mini Heaven eggs and the Heaven Blocks egg contains both a milk and dark block of Heaven chocolate.
Mars has several new products for Easter this year, including the Mars Friends mini egg bag, Mars Planets egg, Galaxy Ripple egg and Galaxy Dark egg.
Mars also recommends a range of boxed chocolates for the sharing market at Easter, including Celebrations and Maltesers.
According to Mars, it is critical to stock filled and mini eggs from the start of the year and continue stocking for the entire season. Customers begin treating themselves to Easter chocolates from the start of the year, so it is important to have a range of self-eat packs in stock from January 1, and shell eggs are purchased as early at 10 weeks before Easter.
“Easter offers a huge opportunity in confectionery as it is used as sharing gifts for family and friends. Traditional Easter is in growth, fuelled by shoppers buying into more premium offers such as novelties and shell eggs. The return of Cadbury Creme Egg signposts the beginning of the spring season and flags up the category to shoppers,” says Harding.
This year Cadbury Creme Egg will be available in depot from January 1 giving retailers only 12 weeks to stock their shelves. CTB recommends that wholesalers ensure the confectionery category is highly visible and well stocked so that retailers can easily locate the products that they need to purchase.
“Green Black’s ‘lightened up’ for Easter 2007 and we’ll continue this theme in 2008, including the introduction of exciting new flavours,” says senior brand manager Gemma Wookey.
Green Black’s says it has doubled its growth year-on-year for the last two years in total Easter, demonstrating the greater demand for premium.
Wookey says: “The wholesale channel is growing in importance as demand for the Green Black’s brand continues – this demand means new distribution opportunities like wholesale are very important to the business. We initially launched with our block chocolate bars, which have performed really well against other premium brands.
“Overall we have experienced more than 200% growth in this channel over the last year.”
=== Dates for your diary ===
Valentine’s Day 14th February
Mother’s Day 2nd March
Easter Sunday 23rd March
=== Buyer’s viewpoint ===
Valentine’s Day, Mother’s Day and Easter all fall within a five-week period and so retailers must be ready early in order to gain fully.
There is likely to be a ‘mad dash’ for Easter confectionery in the two weeks starting March 7, as consumers too find that the occasion looms sooner than they thought. Coupled with our understanding that manufacturers will be reducing their production by around 5% due to the early date of the occasion, stocks could well be tight and sales are likely to be at the eleventh hour.
It is no secret that Easter has become increasingly tough for independent retailers, especially where the core brands are concerned. Supermarkets continue to use the branded medium egg range as a driver for footfall in their stores and 2008 will be no exception. Steer clear of these products and develop a more creative range of higher margin products that are not sold in the supermarkets, coupled with branded items that are not trapped in the price war. Those retailers that take the advice tend to perform much better over the spring season.