The Top 5 Snack and Candy Stories of 2018

CHICAGO – The past 12 months have been more head-scratching that anything for snack and candy companies. Product innovation thrived—salty snack, chocolate and nonchocolate sales all spiked compared to last year—and brands bolstered their product offerings by acquiring smaller companies and launching unique marketing campaigns. But countering this success were a spate of recalls prompted by the possibility that consumers could get sick from various tainted or mislabeled snack and candy products.

Here’s a look at the top five snack and candy stories from 2018 …

The myriad mergers and acquisitions in the consumer packaged goods (CPG) segment in 2018 included some of the biggest brands in the industry. The barrage of M&A arrived just before the new year began. From there, it was a waterfall, with one occurring after the other.

In January, The Ferrero Group, Alba, Italy, agreed to acquire Arlington, Va.-based Nestle’s U.S. confectionery business for $2.8 billion. The acquisition made Ferrero the third-largest confectionery company in the U.S. market. In March, the Campbell Soup Co., Camden, N.J., acquired Charlotte, N.C.-based snacking company Snyder’s-Lance Inc. for $6.1 billion—the most one company paid for another this year—merging the two brands’ products into a U.S.-only division called Campbell Snacks.

Other M&A that occurred this year included Deerfield, Ill.-based Mondelez International’s buyout of Tate’s Bake Shop; PepsiCo, Purchase, N.Y. acquiring Bare Foods Co. and Health Warrior; and Hershey, Pa.-based Hershey Co. acquiring Pirate’s Brand, the maker of Pirate’s Booty snacks.

An abundance of CPG recalls occurred this year, forcing snack and companies—as well as c-store retailers—to improve safety practices and preventive measures to protect their employees and customers. Recalls occurred from traces of salmonella being discovered in the products and because of mislabeled ingredients on the packaging. Some were less extreme than others, seeing products return to shelves within weeks, while more serious recalls took months for products to return to their normal stock.

For instance, in April, Stewart’s Shops Corp., Ballston Spa, N.Y., recalled units of its pint Chocolate Peanut Butter Cup ice cream due to improper packaging; the lid indicated the ice cream contained the c-store chain’s Chocolate flavor. Other recalled products this year included Kansas City, Mo.-based Hostess’ Cookies ‘n Creme Brownies; La Crosse, Wis.-based Kwik Trip’s Kitchen Cravings Parfaits; Plano, Texas-based Frito-Lay’s Smartfood Delight Popcorn; and White Plains, N.Y.-based Danone North America’s Light & Fit Yogurt.

This year’s feud between orange snack brands mirrored a prime-time boxing match. In May, PepsiCo’s Frito-Lay division accused pulse snack label Peatos of belittling the Cheetos brand. Frito-Lay sent a cease-and-desist letter to Peatos, protesting its paw-print logo and slogan, “Tigers live longer than cheetahs,” according to a report from the The Wall Street Journal. Frito-Lay also claimed that Peatos’ name was “confusingly similar” to and “dilutes” the Cheetos brand.

“We are up against the Super Bowl-ad-wielding, snack-aisle-dominating, small-brand-crushing, 8,000-pound gorilla of snacking,” Nick Desai, CEO of Snack it Forward, said at the time of the feud. “If you are going to play in the puffed-cheese snack category, you’d better be ready to take the Cheetah head-on.”

Irving, Texas-based 7-Eleven partnered with Mondelez to launch the confectioner’s new Sour Patch Kids Zombie candies for Halloween. The orange- and grape-flavored candies were available exclusively at various 7-Eleven convenience stores for a limited time in 5-ounce take-home bags for a suggested retail price of $1.99, or $3 for two.

Consumers who purchased Sour Patch Kinds Zombie candies on Oct. 7—World Zombie Day—with their 7-Eleven app, 7-Eleven card or keychain fob automatically entered the Sourpocalypse Sweepstakes, a contest through which 10 winners received a Zombie Sourpocalypse Survival Kit. This package included a tablet computer, $100 7-Eleven  gift card, $25 iTunes gift card and the actual candy, all stuffed in a Sour Patch Kids-themed backpack.

This year also saw leading snack brands launch incubator programs to develop the portfolios and missions of smaller labels. In May, The Kraft Heinz Co. debuted Springboard Brands, a platform that aimed to develop companies in four sectors: natural and organic, specialty and craft, health and performance, and experiential. The initiative included a 16-week program designed to drive young products and brands into investment-ready businesses.

Three months later, PepsiCo debuted The Hive, a platform aimed at building sustainable value propositions, driving distribution and transitioning PepsiCo’s small brands into a larger marketplace. Brands it selected for The Hive included organic oat producer Maker Oats and beverage labels Stubborn Soda and Looza. Two months later, PepsiCo launched its Nutrition Greenhouse program, another initiative designed to accelerate growth and provide mentorship to smaller, emerging companies in the food and beverage market.