Sweet songs of Springtime

Three of the “big four” confectionery makers unveiled their Spring ranges last month. Kevin Whitlock reports on the companies’ products and thinking

Everyone knows that Spring (the season which encompasses Easter, Mother’s Day and Valentine’s Day) is the most important confectionery selling opportunity after Christmas. Yet for many in the wholesale/convenience channel, the arrival of spring does not mean an outburst of wild celebration. In recent years, the multiple grocers have bulldozed the category, selling huge numbers of loss-leading Easter eggs and choc assortments, and leaving the poor old indies only a few scraps.

Graham Walker, Nestlé UK trade communications manager, said he understood the pain, but urged the channel not to give up on Easter.

“The secret is to pick your battles,” he told Wholesale News. “In the convenience channel, 70% of Easter egg sales are in smaller, novelty eggs. Also, 60% of eggs in convenience are bought for immediate consumption. So it’s important to stock those items from the best-loved brands which will make good last-minute gifts.”

He said that despite the supermarkets’ apparent stranglehold on the egg market, spend in the convenience channel was actually going up. “The average spend on eggs has risen by a fifth to £11.21 and this money is going on adult and novelty/character-themed products. In fact, the good news for the wholesale channel is that the fastest-growing price point is in the £10+ bracket.”

He added that Easter was starting to once occupy an increasingly important position in the convenience channel, especially for confectionery, which became the fourth biggest grocery category (up from seventh) during the Easter period, which is now regarded as running from the beginning of the year until Easter Monday.  

“Easter is a key season for confectionery. It accounts for over 30% of seasonal value sales and, what’s more, it’s growing,” said Walker.  “Since 2009 total Easter shopping occasions have grown by 12% from 57.7m to 64.5m in 2012. The average convenience shopper is also now buying more packs (+8%), more often (+6%) and spending more (+22%) across the season [IRI Easter 2011].”

Walker said the key areas of growth – “immediate consumption” and “adult eggs – would be where Nestlé would focus its range for 2013.

Bep Dhaliwal, trade communications manager at Mars Chocolate, agreed: “Spring and Easter offer a number of opportunities to capitalise on confectionery trends and consumer spending habits. Easter will see families and friends getting together over the seasonal period and shoppers will be looking for the ideal products to give and to share.”

He added that key trends for 2013 would be nostalgia (hence the return of a number of old favourites), sharing and novelty characters and packaging.

Ferrero (Europe’s biggest confectionery maker, and number four here in the UK), meanwhile, does have some Easter lines out (Kinder Surprise eggs, Kinder Bunny and a Rocher Bunny) but concentrates a lot of its firepower in Spring on boxed chocolates. According to the company, “eggs tend to be a battleground for the multiples” while boxed chocs remain strong in the impulse channel, generating over £1bn in sales over the Spring season.

The family-owned company said it always takes a long-term vie of the market, and last month revealed its latest insights into the confectionery market. According to customer services director Levi Boorer, the confectionery market is changing as society changes and our habits become more informal.

“Friends are the new family,” said Boorer. “This means that sharing and indulgent treating are becoming more important in the market.”

Boorer added that there were five core reasons why consumers bought boxed chocolates: “my treat” and “special” (the two biggest occasions, both of which are in growth); followed by “seasonal”, “gifting” and “routine”. “Special” was an important motivation at Easter and on Mother’s and Valentine’s Days, he added.

“Consumers seek affordable luxuries to make get-togethers with friends and family a bit more special and often buy them on impulse. Special purchase, whether for sharing or self-indulgence provides increased opportunities for the convenience channel to add value into the category as these are typically made at a higher price point than traditional chocolate confectionery.

“The impulsive nature of boxed confectionery and chocolate novelty products means that the convenience channel typically takes a higher share of sales during this period than the multiples. By focusing on bestselling boxed chocolates and novelty products, rather than trying to compete with products that are continuously on deep cut promotion in bigger stores, the convenience channel can increase its sales across the combined occasions of Valentine’s Day, Mother’s Day and Easter.

“Shoppers don’t want the cheapest option, when looking for something special to give their loved ones, so there are plenty of opportunities for convenience retailers to offer their customers something different while also maximising basket spend during this key period.”

Boorer said that the best way for the wholesale channel to compete was to use seasonal SKUs to add excitement but not to overstock eggs as it was “hard to compete on these lines as they are heavily promoted in the bigger stores and not sellable after Easter.”

He added: “NPD is important but remember that 85% of sales will come from core SKUs – the best sellers on your all-year-round list will provide a greater rate of sale.”

  • Ferrero will be launching at least 10 new products over the next decade in order to grow and consolidate its portfolio, Wholesale News learned last month. Ferrero sales director Jason Sutherland said that although he could not yet reveal the nature of the forthcoming products, they would be “genuine NPDs, not just flavour variations.” He added that the company would not launch new products until they had been thoroughly consumer tested and that Ferrero was completely certain that they would grow the market.

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