Organic, functional products to boost candy sales in 2008

Wouldn’t it be great to have a crystal ball to help us predict what will drive growth in the candy aisles in 2008? While nothing can be certain, a few trends probably will boost candy sales in the coming year. Here’s what the experts tell us:

Expect more growth in premium chocolate. “Premium is certainly here to stay. It’s one of the biggest growth segments,” said Mary Ellen Kuhn, editor of Confectioner Magazine. Recognizing continued growth in the segment, the National Confectioners Association dedicated an area of its show floor at the All Candy Expo this past year to such products. The “Gourmet Marketplace” included 50 exhibitors

Another trend to watch in 2008 will be organics and cause-related products. Organic chocolate maker Green and Black’s, which was purchased by Cadbury in 2005, should get a big push from a $25 million advertising and marketing campaign Cadbury is launching in 2008 to heighten the brand’s visibility.

There’s buzz around Endangered Species Chocolate, a premium chocolate manufacturer that donates 10 percent of net proceeds from product sales to help “support species, habitat and humanity.” Target has picked up the line and has merchandised it at checkout.

More big news is coming from Mars Snack-food’s Dove brand, which will debut two bars with a functional element. Dove Beautiful, which combines milk chocolate with skin-nourishing vitamins C and E, bioten, zinc and cocoa flavanols, and Dove Vitalize, which boasts dark chocolate with energy-releasing B vitamins and cocoa flavanols shown to reduce cholesterol, will be available in early 2008. The new segment presents interesting merchandising opportunities—a clip strip in the skin care aisle or near vitamins?

Sugarless gum has legs. Although gum and mints represent 11 percent of total confectionery retail sales, the segment generated double-digit growth last year. New longer-lasting flavors and varied sweetener options will keep this category humming in the months to come. “The market won’t go back to a sugar component with so many options in sugarless,” Kuhn said. New products coming onto the market are boasting xylitol, a chemical that provides a dental benefit. “These products might edge gum into a functional category,” Kuhn said. “Manufacturers have been talking about it for years.”

Jenn Elleck, a spokes-woman for the National Confectioners Association is betting that in addition to the wild fruit and mint combinations that have been providing growth, we may see more “better for you” fruit flavors, such as acai and pomegranate.

A limit on limited editions. Too many limited-edition products with ultra short lives can make a retailer crazy. While the novelty of a limited edition served to spark sales, juggling too many products from multiple manufacturers became a nightmare for retailers. Industry experts say that manufacturers get the picture and will roll out limited-edition products more cautiously in 2008. “We’ll continue to see them, but with moderation,” Kuhn said.

Licensed products will also fuel the segment. Mars Snackfood is a major promotional partner for the upcoming “Indiana Jones and the Kingdom of the Crystal Skull” and will support the movie with limited editions of M&Ms and Snickers brands. Topps will launch products in support of the upcoming “Speed-racer” movie.

Innovation in novelty isn’t over. “The biggest component in this segment will continue to be interactivity and play value,” Kuhn said. While the popularity of light-up products may be waning, novelty products with dispensers and electronic sound are gaining popularity.

“Technology will continue to drive the category,” said Andy Telatnik, director or marketing at Impact Confections. Products that focus on innovative packaging and new formats are also experiencing a surge. “Liquid candy has had double-digit growth in the last few years. I think there’s more action coming there and in spray candy,” he said. The spray format offers kids sharability and portability—plus kids don’t have to finish it all at once. Most important to this segment, sprays provide novelty.

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