Sweet and Simple

Millennials’ hunger for natural treats drives candy innovation By Kelly Kurt on Apr. 15, 2016

With sales of nonpremium chocolate lagging and scrutiny of sugar’s role in obesity mounting, Cassandra Matos could worry about the category she oversees for McLane Co. Inc. But instead, Matos is excited. The candy category, she says, is about to get fun.

Major suppliers such as The Hershey Co., Nestlé USA and Mars Inc. are overhauling their products to focus on simple, natural ingredients. The changes, along with some new brands expected to launch later this year, could re-energize the candy rack, says Matos, product director of confections for the Temple, Texas-based company.

In overhauling their products, suppliers are involving a generational mix of consumers in their research and development, says Carla Boyington, director of category management for Core-Mark International Inc., South San Francisco, Calif.

“Now candy is for every consumer, and that’s absolutely going to spark innovation,” Boyington says. “It already has.”

With their pledges to include only simple and natural ingredients, candy makers appear likely to transition existing products on the chocolate side. Matos expects more new items will be added to the nonchocolate segment, such as Black Forest’s introduction of an entire line of organic gummies.

Meanwhile, retailers can look to take advantage of the growing segment of premium candy. Suppliers are increasingly gearing their premium products toward c-store customers, Matos says, citing the likes of Lindt Hello Sticks, Godiva Truffle Bars and Ghirardelli Minis bags. Candy in shareable pouches also continues to grab consumer interest and shows incremental growth in c-stores.

In this changing candy climate, category managers should be sure to:

1. Know your consumer base

Millennials are driving the push for products with simple, recognizable ingredients, so evaluate your mix and have items that appeal to them, Matos says.

2. Distinguish premium

Place select premium products on an endcap, a small rack or in sections in your inline set to catch the eye and draw the consumer, Matos says.

3. Ignite impulse

About 80% of candy purchases happen on impulse, Boyington says, so create multiple interruption points throughout the store.

4. Craft the right mix

Grab attention with power brands but also offer a good selection of bags and resealable pouches, Boyington says. Include kid and novelty items in sour profiles and offer seasonal products separate from the set to create fun and excitement.