Snacks & Candy

Candy: Creating ‘Memorable Moments’

Retailers seek to build excitement around confection in ’22, want supplier innovation built on quality over quantity

CHICAGO — In spring 2020, Peter Kempton Jr. wanted to create a spark. The category manager, center store, for Westlake, Ohio-based TravelCenters of America encouraged TA store managers to crank up the creativity machine and develop dynamic, impulse-inducing merchandising programs to support June’s National Candy Month. Identify initiatives to match the fun and flamboyance of the category itself, he requested.

It worked well in 2020 and hit new heights in 2021 when COVID-19 restrictions were relaxing.

Going forward, he says, merchandising candy with more fun is now Kempton’s north-star approach to drive growth for both everyday and seasonal selling—all to support a category that enjoys double-digit sales numbers for nonchocolate formats.

Kempton also is eager to see supplier innovation return to its prepandemic days, with an emphasis on new-product quality over quantity.

“We want promotions to come to life and create memorable moments for guests,” says Kempton, who has been with TravelCenters of America for 11 years and center-store category manager for more than five years.

The timing of Kempton’s challenge coordinated with TA’s collaboration with suppliers and the National Confectioners Association (NCA) to provide store managers with more license to embrace more creative monthly merchandising plans.

Fast-forward to 2021, as more pandemic restrictions were lifted, Kempton was “even more energized” to push the envelope. “We became very creative with endcap displays. One store manager blew up balloons to make it festive. Some bought materials from craft stores to create cool replicas of candy for endcaps,” says Kempton, who oversees TravelCenters’ three store brands: TA, TA Express and Petro Stopping Center.

The initiative landed Kempton the 2021 Confectionery Leadership Award from Washington, D.C.-based NCA, and he was a finalist for CSP’s 2022 Category Manager of the Year (CMOY) in the center-store category.

Nationwide, strategies around price, promotion and display helped chocolate amass $3.16 billion in sales in c-stores in 2021, increasing dollars 8.9% and units 4.7%, according to data from Chicago-based IRI.Nonchocolates—a smaller segment at $2.64 billion within the channel—operated in more rarefied air by registering 20.6% and 11.2% growth, respectively, across dollars and units. 

Many suppliers backed off innovation in 2020 and instead focused narrowly on their core brand cultivation. Of course, the definition of “innovation” is subjective. “Innovation isn’t a case of more SKUs but deeper than that; one way is it’s compelling packaging,” says Tim Young, category manager, center store, for FiveStar, an 80-store chain owned by Newcomb Oil Co., Bardstown, Ky., and another CMOY award finalist.

“The new M&M’s Album Art pack is an example,” he says. In that case, M&M’s has created a collection of packages inspired by popular music album covers. “That level of innovation can push the needle forward quicker in the post-pandemic,” he says. 

Kelley Gutierrez, senior category manager, candy and snacks, center store, for Franklin, Tenn.-based MAPCO Express and three-time CMOY winner, sees nonchocolate suppliers “following the market and understanding that people demand innovation for sour, fruity and gummy varieties. Skittles Gummies are a great example, and so is what we see with Hi-Chew. The brand has been around awhile but had not been as relevant with younger consumers like now. Kids seek bold innovation for both sour and fruity.” 

Early in 2021, suppliers approached Kempton “with up to 20 new SKUs, but we had a problem just selling core SKUs, so we had to back off their secondary flavors. A year later, it’s still a case of less is more within the innovation pipeline. It’s great to drive trial with new items, but the core is what sells. Flagship Reese’s will always prevail as part of the 80/20 selling rule.”

Young is eager to continue leveraging FiveStar’s mobile app to push candy impulse buying. “We’re working on enhancing it,” he says. “We’ve already been able to capitalize on our 12 Days of Xmas candy program and March Madness [promotion]. We now want to delve deeper because I think, from an incentive standpoint, you have to give your customers an urgency with candy.”

Of course, since the pandemic was declared, new confection merchandising trends have shaped up. Core items are more the norm. Meanwhile, new customers discovered c-stores can be the go-to option for candy and snacks, and premium chocolates found a home in sets.

Long the domain of specialty stores, TA/Petro committed to building its premium chocolate portfolio. “We found that consumers aren’t reluctant to spend money and trade up to larger packages,” says Kempton.

The expansion of premium is “something new to many c-stores, and once again was part of consumers gravitating to the c-store in 2020 rather than, say, a specialty retailer. The increased traffic helped people see that premium items were a convenient buying option. With these products, there’s also more price elasticity and a gifting component.” 

Another TA technique was focusing on premium change-makers. “The idea was to have consumers give trial to, say, Lindt Truffles or Ghirardelli Squares, so we put a merchandising spotlight on the smaller sizes. Customers got hooked and would later trade up to larger packages.”

FiveStar became involved in the premium chocolate segment in 2019, dedicating a full shelf to varieties such as New York-based Niagara Chocolates, says Young. One way premium chocolate can more easily integrate into FiveStar sets is through consolidation, Young says. For example: Hershey’s acquired Lily’s Confectionery in May 2021, and it sparked direct-store delivery scale.

“We want to always provide assortment and variety,” says Young. “At the end of the day, I see c-stores as being the ‘concession stand’ for adult candy buying.” 

Click here to view the complete Category Management Handbook report.

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