Confectionery: sweets dodge bullets in the war on sugar

For a category directly in the firing line of the war against sugar, confectionery is looking surprisingly unscathed at present.

Despite growing public concern over sugar intake - and retailers including Tesco banning confectionery from checkout areas - much of the fire has been directed towards drinks rather than sweets. Overall volume sales of sugar confectionery have dipped just 1.6% year on year, and value sales less.

“The increased media attention on sugar has not dramatically impacted sales but we are seeing a rise in the variety of pack formats available; from portion-controlled treats to larger bags that can be shared,” says Herwig Vennekens, managing director of top-selling UK sugar confectionery brand Haribo.

For his business, this has included the development of single-serve bags that start as small as 16g. And he is unconcerned about checkout bans: “In contrast to other confectionery suppliers, Haribo has minimal presence at the checkout and predominantly sits in the confectionery shelf and aisles.”

Haribo sales have dipped slightly in volume terms but value has grown thanks primarily to NPD, says Vennekens. This has included the licensed Minions sweets (see below), taking its sour Tangfastics in multipacks and extending the sub-brand into the mallows market with Tangfastic Chamallows. “Sour has continued to perform well,” adds Vennekens. “Despite an influx of new sour treats during 2014, Tangfastics remains the most popular and the only sour treat within the top 10 hanging bags.”

Another trend driving growth is demand for sweets with a hard shell, such as Haribo’s own Maoam Pinballs, and Wrigley’s Skittles, which are up 5.6% by value on slightly higher volume gains. Skittles was expanded with a Wild Berry flavour - a mix of raspberry, wild cherry, berry punch, melon berry and strawberry-flavoured sweets in a 55g bag and 174g pouch. Designed to attract new consumers with a “more mature taste palate”, the launch was supported with a £10m push.

Ferrero has also invested in TV in 2014 to support its Tic Tac brand, which has grown 6.5% by value. Ferrero launched a £2m multimedia campaign in April to drive awareness around the launch of Tic Tac apple Burst at the start of the year, and in August rolled out a text to win push that offers the chance to win £5 or a voucher for £5 off a minimum spend with stores such as Topman and Dorothy Perkins.

For Mondelez, two key trends bringing in the money, and driving product development, are sharing formats and cross-pollinating of brands and categories. “The most exciting new products in confectionery have been all about blowing apart category boundaries and bringing together different flavours, textures and brands, which drive new consumers to the category,” says marketing manager Elena Germani.

Mondelez has been doing this in the chocolate category for a few years with products such as Cadbury Dairy Milk with Oreo, and this year its Maynards brand got in on the action. From April, Maynards candy has been sold alongside Cadbury Dairy Milk Buttons in one of the SKUs in Cadbury Dairy Milk’s Marvellous Mix-Ups.

And Maynards, which is up 6.5% by value on volumes up almost 10%, was expanded this year with the Maynards Discovery Patch range, featuring fruit flavour jelly and foam sweets in three themed variants - Animals, Body Bits and Myths & Monsters. Designed to attract young families to the category, the range has been backed by TV and digital activity that includes an app that can be used to unlock augmented reality content by scanning the confectionery packaging.

Maynards was also one of the Mondelez brands - along with Bassetts and The Natural Confectionery Co - that took part in the company’s first cross-brand candy promotion. Called Win Nothing But Fun Every Day, the on-pack promo ran across 32 SKUS and attracted more than 317,000 entries.

That activity hasn’t turned around Bassetts sales - down about 7.5% by value and volume - but Mondelez has high hopes for the upcoming launch of Bassetts Jelly Bunnies, which roll out next Easter in a 190g sharing bag. “The launch of the Easter Bunnies variant will broaden the appeal of the brand and give consumers the option to enjo y candy in addition to chocolate at Easter,” says assistant brand manager Pippa Lewis.

Mondelez will be hoping Bassetts enjoys the sort of boost Cadbury Eclairs received from innovation, with the launch of chocolate-coated Cadbury Eclairs Velvets contributing to a 9.5% growth in value sales.

Nestlé will also be hoping to boost sales this year. A dip in the value and volume of Polo has been dwarfed by the £10.2m slump in sales across its Rowntree’s portfolio.

And while consumer concerns over sugar may be giving many confectionery players sleepless nights, one part of the market unlikely to be troubled by the concerns is gum. Wrigley, which dominates the category, says more than 95% of its brands are sugar-free, and “we expect this to continue well into 2015 as chewers seek out a healthy addition to their day-to-day oral care routine,” says Wrigley UK & Ireland marketing director Pamela Bower-Nye. Wrigley continues to drive its Eat Drink Chew marketing message, supported by the British Dental Health Foundation’s accreditation of its booming Extra brand - up 8.3% to £203.8m and boosted by the introduction of a 46-pellet bottle in 2013, with more than five million packs sold since launch.

Wrigley is keen to get across the message that the oral health benefits of sugar-free gum means it should continue to be available at checkouts. “Sugar-free gum has many oral health benefits, verified by the European Food Standards Agency,” adds Bower-Nye.

The supplier has invested in development of an LED-lit retail display unit designed to boost sales from the checkout and after a successful initial trial, more of the units are set to be rolled out in 2015. Wrigley has also invested in NPD to tap demand for flavoured sugar-free gum, launching Extra Ice Citrus and Extra White Bubblemint. Meanwhile, Airwaves is up 4.3% year on year following a £6m marketing push in 2014, while Five has seen the introduction of two new flavours, 5Pulse and 5Glare. “5Gum attracts new chewers into the category by offering a fruit alternative to mint gum,” says Bower-Nye. “Wrigley will continue to support the brand throughout 2015 with some exciting projects ahead.”