In the confection category, iconic brands—fueled by a nostalgic cache—drive the lion’s share of growth. While the largest brands lean on their past to thrive in the here and now, private-label candy options are making a strong push for relevance.
The effort appears to be working for both every day and seasonal candy strategies: Of the percentage of convenience-store shoppers who said they were willing to broadly purchase private labels, candy (50.9% of shoppers) ranked third behind beverages (62.1%) and salty/savory/sweet snacks (52.1%), according to Chicago-based Circana.
The private-label confection report card across convenience in 2023 showed double-digit dollar and volume growth (16.4% and 15.9%, respectively), outpacing national brands at 11.8% and 5.6%, respectively, according to Circana.
“Price was a likely driver, especially within non-chocolate candy where national brand year-over-year prices increased by 13%, while private label was up slightly, at 1%,” said Dan Sadler, vice president at Circana. “In addition, the price gap between non-chocolate private label candy and national brands was 45%.”
Once the domain of items like paper products and analgesics, private labels appear to be seeping into core categories, such as candy. The National Association of Convenience Store (NACS) “Convenience Voices” study for 2022 found that 26.1% of consumers shop at a convenience store for the selection of products offered. Of that, 15.5% selected private-branded options.
Private-branded beverages ranked highest with convenience shoppers, the NACS study found, with more than half expressing willingness to purchase salty, savory or packaged sweet snacks or candy.
Retailers Jump on Board
Retailers have jumped on board the trend, particularly larger chains with scale to invest in their own brands. Many are motivated by the ability to control the overall confection segment mix, plus endure potential supply chain issues.
7-Eleven Inc. recently added bagged chocolates to its private-label portfolio. Coming in three flavors, the line falls within the retailer’s 7-Select candy line, with chocolate manufactured in the U.S. It uses high-quality ingredients, including fresh cream and pure vanilla, said Nikki Boyers, 7-Eleven’s vice president of private and emerging brands.
- 7-Eleven is No. 1 on CSP’s 2024 Top 40 Update to the 2023 Top 202 ranking of U.S. c-store chains by store count. Watch for the full 2024 Top 202 ranking in the June issue of CSP magazine and in CSP Daily News. Love’s Travel Stops & Country Stores Inc. is No. 16.
Westlake, Texas-based Core-Mark International’s peg bag line, Core-Mark’s Mighty Marked Tub-Sized Snacking and Candy program, is designed with input from c-store operators. Powered by a retail merchandiser with a slim profile on smooth-rolling caster wheels, the program supports ease of positioning in limited store footprints.
Armed with varieties that include chocolate-covered nuts, dried fruit, sour sweets, gummy candies and more, consistent branding of Mighty Marked allows retailers “to build a strong, recognizable candy selection, while fresh and clean packaging design is eye-catching to drive impulse sales,” said Chris Murray, executive vice president of marketing for Core-Mark.
“We’re committed to providing value options and delivering unique advantages for our retailers,” said Murray. “With a goal to elevate the snacking experience, the company offers this as an all-in-one snack and candy tub solutions to drive point-of-purchase sales for our customers.”
Pushing Proprietary Offerings
Other larger chains are pushing the proprietary candy and snack envelope. Love's Travel Stops & Country Stores rolled out its own line in 2019, motivated by several factors. One was the autonomy to distribute its own candy and re-stock shelves quicker.
Customers have “responded incredibly well” to Love’s-branded confection, which completed a 2023 program refreshing with a “new look and feel,” said Bryen Bloomfield, category manager for center store, at the Oklahoma City-based chain of 644 travel centers in 42 states.
With candy serving as the chain’s first venture into consumable private label, Love’s Bagged Candy “will continue to be a focus to drive our business moving forward, as it’s seen as a massive success,” said Bloomfield, the 2024 recipient of CSP’s Category Manager of the Year (CMOY) award for center store. “We’re excited to get into development of unique flavors and shapes.”
Love’s program reaped double-digit dollar growth in 2023 from like-period 2022. “We’ve seen great success with our assortment, the growth of the brand and the learnings that came along with managing it,” said Bloomfield, adding that varieties can be had for about $1.69 per bag (two for $3).
Going With the Flow
Going with the flow appears to be the prudent approach retailers embark upon with private-label candy, with certain sub-segments flashing more upside than others.
Across all non-chocolates, private labels landed ninth in the top 10 SKUs for a 52-week period ending Dec. 31, 2023, with $103 million in c-store sales and 23.5% dollar growth, reports Circana.
Shedding light on the private-label merchandising success story, Sadler of Circana said “much of the private-label non-chocolate growth within the convenience channel can be attributed to a 9%[HH1] increase in the number of items on the shelf, driven by more gummy items.”
Drilling down, private-label licorice ranked 11th for the period, with dollars up 10.7%. Private-label specialty nut/coconut generated $1.7 million in sales for 2023, growing dollars 28.7%.
Private-label sugar-free diet candy, however, lost 94% in dollars for the year, reports Circana.
Several segments across chocolate (sugar free and snack sizes) had no private-label representation in the top 20 SKUs. Dollar sales of private-label gift boxes were enough to land in the lower half of the top 10—a new entry at $480,000 in c-store sales, Circana said.
Smaller Retailer’s Perspective
Small retailers have decisions to make with private-label confection. One route is partnering with wholesale distributors such as Core-Mark on Mighty Marked, an option that comes equipped with significant program support.
But some small-size operators don’t see a feasible pathway to private labels.
Alex Weatherall, owner of Sherborn Market, Sherborn, Massachusetts, is only willing to stock certain types of private-label categories that make sense—like paper products—but categories such as beverages and confection remain the domain of national brands.
“When I think private label or ‘proprietary’ I think of it as something I would brand, produce and deliver—and we can’t economically do that,” he said.
[HH1]A 9% increase?