Chocolate Confectionery - US - February 2015

SCOPE AND THEMES
What you need to know
Definition
Data sources
Sales data
Consumer survey data
Abbreviations and terms
Abbreviations
EXECUTIVE SUMMARY
The market
Category sales are estimated to reach $21.3 billion in 2014
Figure 1: Total US retail sales and forecast of chocolate confectionery, at current prices, 2009-19
Segment performance
Box/bag/bars greater than 3.5 oz. continue to lead the category, growth
Figure 2: Total US retail sales of chocolate confectionery, by segment, at current prices, 2009-14
Leading companies
Lindt overtakes Nestlé in MULO sales of chocolate in 2014
Figure 3: Total US retail sales of chocolate confectionery, by segment, at current prices, 2012 and 2014 ($ millions)
The consumer
Some 85% of consumers buy chocolate, but only 75% eat it
Figure 4: Any chocolate confectionery purchase (%), by age, November 2014
Treat positioning is key
Figure 5: Reasons for eating (%), by age, November 2014
What we think
ISSUES AND INSIGHTS
Are consumers noticing price increases?
Issue
Insight: Enhancing perception of quality and engaging in price promotions can preserve engagement
What’s the role of health in chocolate confectionery?
Issue
Insight: The category should promote inherent health offerings and expand permissible options
What kind of innovation resonates with consumers?
Issue
Insight: Innovation should carry some form of familiarity
TREND APPLICATION
Trend: Mood to Order
Trend: Never Say Die
Trend: Let’s Make a Deal
MARKET SIZE AND FORECAST
Key points
Sales and forecast of chocolate confectionery
Figure 6: Total US retail sales and forecast of chocolate confectionery, at current prices, 2009-19
Figure 7: Total US retail sales and forecast of chocolate confectionery, at inflation-adjusted prices, 2009-19
Category growth will continue, but slow slightly
Figure 8: Total US retail sales and forecast of chocolate confectionery, at current prices, 2009-19
Forecast methodology
MARKET DRIVERS
US consumer taste for confectionery grows
Figure 9: Chocolate and other candy, July 2009-September 2014
A taste for chocolate also appears to be on the rise
More chocolate launches means more competition for confectionery category
Category can combat the competition by doing what it does best
Blurring the lines may lessen any negative view chocolate has as a candy
Co-branding can be a means of keeping skin in the game
SEGMENT PERFORMANCE
Key points
Box/bag/bars greater than 3.5 oz continue to lead the category, growth
Figure 10: Total US retail sales of chocolate confectionery, by segment, at current prices, 2012 and 2014
Box/bag/bars >3.5 oz grew 31% from 2009-14
US retail sales of box/bag/bar >3.5 oz
Figure 11: Total US retail sales and forecast of box/bag/bar >3.5 oz, at current prices, 2009-19
Figure 12: Total US retail sales and forecast of Box/bag/bar >3.5 oz, at inflation-adjusted prices, 2009-19
Seasonal sales grew 23% from 2009-14
US retail sales of seasonal chocolate
Figure 13: Total US retail sales and forecast of seasonal chocolate, at current prices, 2009-19
Figure 14: Total US retail sales and forecast of seasonal chocolate, at inflation-adjusted prices, 2009-19
Box/bag/bars <3.5 oz grew 31% from 2009-14
US retail sales of box/bag/bar <3.5 oz
Figure 15: Total US retail sales and forecast of box/bag/bar <3.5 oz, at current prices, 2009-19
Figure 16: Total US retail sales and forecast of box/bag/bar <3.5 oz, at inflation-adjusted prices, 2009-19
Snack size chocolate continues downward slide
US retail sales of snack size chocolate
Figure 17: Total US retail sales and forecast of snack-size chocolate, at current prices, 2009-19
Figure 18: Total US retail sales and forecast of snack size chocolate, at inflation-adjusted prices, 2009-19
Gift box sales fell 4% in 2014
US retail sales of gift box chocolate
Figure 19: Total US retail sales and forecast of gift box chocolate, at current prices, 2009-19
Figure 20: Total US retail sales and forecast of gift box chocolate, at inflation-adjusted prices, 2009-19
Sugar free sales decline by 19% from 2009-14
US retail sales of sugar-free chocolate
Figure 21: Total US retail sales and forecast of sugar-free chocolate, at current prices, 2009-19
Figure 22: Total US retail sales and forecast of sugar-free chocolate, at inflation-adjusted prices, 2009-19
RETAIL CHANNELS
Key points
Other retail channels represent largest share of category sales
Mass appeals for convenience, affordability
Purchase habits limit growth potential of supermarkets, drug stores
Total US sales of chocolate confectionery
Figure 23: Total US retail sales of chocolate confectionery, by channel, at current prices, 2012 and 2014
Supermarket sales grew 24% from 2009-14
Supermarket sales of chocolate confectionery
Figure 24: US supermarket sales of chocolate confectionery, at current prices, 2009-14
Drug store sales grew 17% from 2009-14
Drug store sales of chocolate confectionery
Figure 25: US drug store sales of chocolate confectionery, at current prices, 2009-14
Other MULO channel sales grew 26% from 2009-14
Other MULO channel sales of chocolate confectionery
Figure 26: US sales of chocolate confectionery through other MULO channels*, at current prices, 2009-14
Other retail channel sales grew 23% from 2009-14
Convenience
Other retail channel sales of chocolate confectionery
Figure 27: US sales of chocolate confectionery through other retail channels*, at current prices, 2009-14
Natural channel sales grow 40% from 2012-14
Natural channel sales of chocolate confectionery
Figure 28: Natural supermarket sales of chocolate confectionery, at current prices, rolling 52 weeks 2012-14
Fair Trade certification growing at natural channels
Natural channel sales of Fair Trade chocolate confectionery
Figure 29: Supermarket sales of chocolate confectionery, by fair-trade status, at current prices, rolling 52 weeks 2012 and 2014
COMPETITIVE CONTEXT
Health concerns call indulgence items into question
Figure 30: Chocolate statements (health), by age, November 2014
Promote chocolate’s strengths
Provide healthy options
Rising commodities costs result in product price increases
LEADING COMPANIES
Key points
Lindt overtakes Nestlé in MULO sales of chocolate in 2014
Figure 31: MULO sales of chocolate, by leading companies, rolling 52 weeks 2013 and 2014
Hershey is a classic; Ghirardelli leads for quality
Figure 32: Opinions toward chocolate companies, correspondence Analysis, February 2015
Figure 33: Opinions toward chocolate companies, February 2015
Hershey represents 50% of bars/bags/boxes >3.5 oz
MULO sales of bars/bags/boxes >3.5 oz
Figure 34: MULO sales of chocolate bars/bags/boxes >3.5 oz, by leading companies, rolling 52 weeks 2013 and 2014
Easter drives sales for seasonal leaders
MULO sales of seasonal chocolate
Figure 35: MULO sales of seasonal chocolate, by leading companies, rolling 52 weeks 2013 and 2014
Snack size leader Hershey’s gains, but all others struggle
MULO sales of snack size
Figure 36: MULO sales of snack size chocolate, by leading companies, rolling 52 weeks 2013 and 2014
Ferrero gains on Russell Stover in gift box segment
MULO sales of gift box
Figure 37: MULO sales of gift box chocolate, by leading companies, rolling 52 weeks 2013 and 2014
York sees strong growth in sugar-free
MULO sales of sugar-free chocolate
Figure 38: MULO sales of sugar-free chocolate, by leading companies, rolling 52 weeks 2013 and 2014
Leaders maintain their position in <3.5 oz bar and novelty segment
MULO sales of <3.5 oz bar and novelty chocolate
Figure 39: MULO sales of <3.5oz bar and novelty chocolate, by leading companies, rolling 52 weeks 2013 and 2014
INNOVATIONS AND INNOVATORS
New product launches continue to drop, packaging innovation is up
Figure 40: Chocolate confectionery launches, by launch type, 2010-15
Seasonal launches see strong growth
Figure 41: Chocolate confectionery launches, by subcategory, 2010-14
Leading claims continue to grow
Figure 42: Chocolate confectionery launches, by top 10 claims, 2010-14
Gift boxes should better align with consumer interest
Figure 43: Chocolate confectionery launches, by top 10 claims of boxed launches, 2010-14
Plain launches down, nuts and nut flavors up
Figure 44: Chocolate confectionery launches, by top 10 flavors, 2010-14
Fruit and other mix-ins boost health profile, make category less candy-like
Premiumization also seen in flavor innovation
Functionality also adds value
Dessert-inspired flavors may boost dessert usage
Seasonal positioning offers opportunity for flavor innovation
Figure 45: Chocolate confectionery launches, by top 10 flavors among seasonal launches, 2010-14
Pouches see strong growth
Figure 46: Chocolate confectionery launches, by packaging, 2010-15*
Nostalgia is evident in product launches
SOCIAL MEDIA
Market overview
Key social media metrics
Figure 47: Key social media metrics, January 2015
Brand usage and awareness
Figure 48: Brand usage and awareness for select chocolate confectionery brands, Nov. 2014
Interactions with chocolate confectionery brands
Figure 49: Interactions with select chocolate confectionery brands, November 2014
Leading online campaigns
Sports promotions
Legacy
Seasonal/special occasions
What we think
Online conversations
Figure 50: Online conversations for select chocolate confectionery brands, by week, Jan. 26, 2014-Jan. 25, 2015
Where are people talking about chocolate confectioneries?
Figure 51: Online conversations for select chocolate confectionery brands, by page type, Jan. 26, 2014-Jan. 25, 2015
What are people talking about?
Figure 52: Topics of conversation for select chocolate confectionery brands, Jan. 26, 2014-Jan. 25, 2015
CHOCOLATE PURCHASE AND CONSUMPTION
Key points
Some 85% of consumers buy chocolate, but only 75% eat it
Figure 53: Any chocolate confectionery purchase, by age, November 2014
Half of consumers eat chocolate at least once a week
Figure 54: Chocolate statements (consumption frequency), by age, November 2014
Category needs stronger appeal to older consumers
Figure 55: Chocolate confectionery purchase (for self), by age, November 2014
Young men are big box buyers
Figure 56: Any chocolate confectionery purchase, by gender and age, November 2014
Lower earners less likely to buy chocolate, but are still in the market
Figure 57: Any chocolate confectionery purchase, by household income, November 2014
Figure 58: Chocolate statements (consumption frequency), by household income, November 2014
Favorite brands might attract attention with boxes
Figure 59: Chocolate confectionery purchase (for self), by chocolate brands (purchased consumed in the past year), November 2014
ATTRIBUTES OF INTEREST
Key points
Interest in mix-ins can help the category weather price increases
A focus on health may be the key to appealing to older consumers
Figure 60: Chocolate purchase (attributes), by age, November 2014
Premium offerings appeal to highest earners
Figure 61: Chocolate purchase (attributes), by household income, November 2014
Sugar-free may benefit from expanded formats
Figure 62: Chocolate confectionery purchase (for self), by chocolate candy buyer (by attributes), November 2014
REASONS FOR EATING
Key points
Snacking leads consumption occasion
Figure 63: Consumption occasion, by age, November 2014
Premium chocolate may benefit from dessert/sharing positioning
Figure 64: Consumption occasion, by chocolate candy buyer (by attributes), November 2014
Energy chocolate may be positioned for on-the-go
Figure 65: Consumption occasion, by reasons for eating, November 2014
Treat positioning leads reasons for eating
Figure 66: Reasons for eating, by gender, November 2014
Mood enhancement important among young shoppers
Figure 67: Reasons for eating, by age, November 2014
Older women looking for a way to treat themselves
Figure 68: Reasons for eating, by gender and age, November 2014
Bars rule for on-the-go
Figure 69: Chocolate confectionery purchase (for self), by consumption occasion, November 2014
Seasonal chocolate has reward appeal
Figure 70: Chocolate confectionery purchase (for self), by reasons for eating, November 2014
Dark and premium find appeal among hosts
Figure 71: Chocolate purchase (attributes), by consumption occasion, November 2014
Consumers seeking an energy boost go for the solid, pure stuff
Figure 72: Chocolate purchase (attributes), by reasons for eating, November 2014
PURCHASE LOCATION
Key points
Mass leads chocolate purchase location
Supermarkets hold on to older shoppers
Figure 73: Purchase location, by age, November 2014
Supermarket chocolate may be perceived as high in price
Figure 74: Purchase location, by household income, November 2014
Figure 75: Purchase location, by frequent chocolate eaters, November 2014
Online could stand to grow seasonal share
Figure 76: Purchase location, by chocolate candy buyer (by type), November 2014
Supermarkets/natural outlets have premium appeal
Figure 77: Purchase location, by chocolate candy buyer (by attributes), November 2014
Club stores can position chocolate for entertaining
Figure 78: Purchase location, by consumption occasion, November 2014
Natural stores may do well to promote healthfulness of chocolate
Figure 79: Chocolate statements (health), by purchase location (1 of 3), November 2014
Figure 80: Chocolate statements (health), by purchase location (2 of 3), November 2014
Figure 81: Chocolate statements (health), by purchase location (3 of 3), November 2014
Fair Trade certification important among natural store shoppers
Figure 82: Chocolate statements (attributes of interest), by purchase location (1 of 3), November 2014
Figure 83: Chocolate statements (attributes of interest), by purchase location (2 of 3), November 2014
Figure 84: Chocolate statements (attributes of interest), by purchase location (3 of 3), November 2014
STATEMENTS RELATED TO CHOCOLATE
Key points
Purchase habits
Holidays boost chocolate purchase
Young shoppers look for discounts, more open to new products
Figure 85: Chocolate statements (purchase habits), by age, November 2014
Premium offerings around holidays may attract high earners
Figure 86: Chocolate statements (purchase habits), by household income, November 2014
Boxes may get a bump from holidays, premium positioning
Figure 87: Chocolate statements (purchase habits), by chocolate candy buyer (by type), November 2014
Store brand buyers interested in variety, cost savings
Figure 88: Chocolate statements (purchase habits), by chocolate candy buyer (by attributes), November 2014
Frequent eaters not looking for new products
Figure 89: Chocolate statements (purchase habits), by frequent chocolate eaters, November 2014
Attributes of interest
Interest in Fair Trade is still small, but patterns may suggest growth
Figure 90: Chocolate statements (attributes of interest), by age, November 2014
Higher earners look for more cocoa
Figure 91: Chocolate statements (attributes of interest), by household income, November 2014
Figure 92: Chocolate statements (attributes of interest), by chocolate candy buyer (by attributes), November 2014
Boxes should go dark
Figure 93: Chocolate statements (attributes of interest), by chocolate candy buyer (by type), November 2014
IMPACT OF PRICE INCREASES
Key points
Price increases are being noticed
Young shoppers trading down to less expensive brands
Figure 94: Impact of price increases, by age, November 2014
Lower earners buying less, middle earners looking for savings
Figure 95: Impact of price increases, by household income, November 2014
Frequent eaters are less likely to be impacted, but are looking for sales
Figure 96: Impact of price increases, by frequent chocolate eaters, November 2014
IMPACT OF RACE AND HISPANIC ORIGIN
Key points
Hispanics may be buying bars for kids
Figure 97: Any chocolate confectionery purchase, by race/Hispanic origin, November 2014
Figure 98: Chocolate confectionery purchase (for self), by race/Hispanic origin, November 2014
Blacks reducing consumption due to health
Figure 99: Chocolate statements, by race/Hispanic origin, November 2014
Figure 100: Chocolate statements, by race/Hispanic origin, November 2014
Asians interested in premium, Hispanics in health
Figure 101: Chocolate purchase (attributes), by race/Hispanic origin, November 2014
Figure 102: Chocolate statements, by race/Hispanic origin, November 2014
Mass is an important outlet for Hispanic chocolate shoppers
Figure 103: Purchase location, by race/Hispanic origin, November 2014
Reward positioning resonates with Hispanics
Figure 104: Reasons for eating, by race/Hispanic origin, November 2014
One in 10 Hispanics have traded up to higher-priced chocolate
Figure 105: Impact of price increases, by race/Hispanic origin, November 2014
CUSTOM CONSUMER GROUP – BUYING FOR KIDS
Key points
More than half of respondents buy chocolate for their kids
Figure 106: Chocolate purchase, by presence of children in household, November 2014
Mass outlets, club stores, and candy stores popular among those who buy for kids
Figure 107: Purchase location, by chocolate candy buyer for kids, November 2014
Holidays and variety appeal to those who buy for kids
Figure 108: Chocolate statements (purchase habits), by chocolate candy buyer for kids, November 2014
Mix-ins may appeal for health
Figure 109: Chocolate statements (health), by chocolate candy buyer for kids, November 2014
Hershey appears as high quality and innovative to those who buy for kids
Figure 110: Opinions toward chocolate companies (Hershey), by chocolate candy buyer for kids, November 2014
Kids are slightly more likely than teens to eat candy
Figure 111: Chocolate and other candy, April 2009-June 2014
Figure 112: Chocolate and other candy, April 2009-June 2014
Teens eat more
Figure 113: Bars and other candy, by age, April 2013-June 2014
Figure 114: Chocolate and other candy, by age, April 2013-June 2014
Kids access to candy on the decline
Figure 115: Food and drink in school, April 2009-June 2014
Figure 116: Allowance/money, April 2009-June 2014
APPENDIX – OTHER USEFUL TABLES
Chocolate purchase and consumption
Figure 117: Chocolate confectionery purchase (for self), by gender and age, November 2014
Figure 118: Chocolate statements (consumption frequency), by gender and age, November 2014
Chocolate attributes
Figure 119: Chocolate purchase (attributes), by gender and age, November 2014
Figure 120: Chocolate purchase (attributes), by Hispanic origin and household income, November 2014
Figure 121: Chocolate purchase (attributes), by presence of children and age in household, November 2014
Figure 122: Chocolate purchase (attributes), by chocolate candy buyer (by type), November 2014
Reasons for eating
Figure 123: Consumption occasion, by race/Hispanic origin, November 2014
Figure 124: Chocolate statements (consumption frequency), by reasons for eating, November 2014
Purchase location
Figure 125: Purchase location, by gender and age, November 2014
Figure 126: Purchase location, by household size, November 2014
Figure 127: Purchase location, by reasons for eating, November 2014
Chocolate statements
Figure 128: Chocolate statements (purchase habits), by gender and age, November 2014
Figure 129: Chocolate statements (health), by gender and age, November 2014
Figure 130: Chocolate statements (attributes of interest), by gender and age, November 2014
Figure 131: Chocolate statements, by race/Hispanic origin, November 2014
Figure 132: Chocolate statements, by Hispanic origin and household income, November 2014
Figure 133: Chocolate statements (attributes of interest), by consumption occasion, November 2014
Figure 134: Chocolate statements (health), by reasons for eating, November 2014
Figure 135: Chocolate statements (purchase habits), by purchase location (1 of 3), November 2014
Figure 136: Chocolate statements (purchase habits), by purchase location (2 of 3), November 2014
Figure 137: Chocolate statements (purchase habits), by purchase location (3 of 3), November 2014
APPENDIX – SOCIAL MEDIA
Brand usage or awareness
Figure 138: Brand usage or awareness, November 2014
Figure 139: Butterfinger usage or awareness, by demographics, November 2014
Figure 140: Dove (chocolate) usage or awareness, by demographics, November 2014
Figure 141: Reese’s usage or awareness, by demographics, November 2014
Figure 142: Lindt usage or awareness, by demographics, November 2014
Figure 143: Ghirardelli usage or awareness, by demographics, November 2014
Figure 144: Russell Stover usage or awareness, by demographics, November 2014
Activities done
Figure 145: Activities done, November 2014
Figure 146: Butterfinger – Activities done – I have looked up/talked about this brand online on social media, by demographics, November 2014
Figure 147: Butterfinger – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, November 2014
Figure 148: Butterfinger – Activities done – I follow/like the brand on social media because, by demographics, November 2014
Figure 149: Butterfinger – Activities done – I have researched the brand on social media to, by demographics, November 2014
Figure 150: Dove (chocolate) – Activities done – I have looked up/talked about this brand online on social media, by demographics, November 2014
Figure 151: Dove (chocolate) – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, November 2014
Figure 152: Dove (chocolate) – Activities done – I follow/like the brand on social media because, by demographics, November 2014
Figure 153: Dove (chocolate) – Activities done – I have researched the brand on social media to, by demographics, November 2014
Figure 154: Reese’s – Activities done – I have looked up/talked about this brand online on social media, by demographics, November 2014
Figure 155: Reese’s – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, November 2014
Figure 156: Reese’s – Activities done – I follow/like the brand on social media because, by demographics, November 2014
Figure 157: Reese’s – Activities done – I have researched the brand on social media to, by demographics, November 2014
Figure 158: Lindt – Activities done – I have looked up/talked about this brand online on social media, by demographics, November 2014
Figure 159: Lindt – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, November 2014
Figure 160: Lindt – Activities done – I follow/like the brand on social media because, by demographics, November 2014
Figure 161: Ghirardelli – Activities done – I have looked up/talked about this brand online on social media, by demographics, November 2014
Figure 162: Ghirardelli – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, November 2014
Figure 163: Ghirardelli – Activities done – I follow/like the brand on social media because, by demographics, November 2014
Figure 164: Ghirardelli – Activities done – I have researched the brand on social media to, by demographics, November 2014
Figure 165: Russell Stover – Activities done – I have looked up/talked about this brand online on social media, by demographics, November 2014
Figure 166: Russell Stover – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, November 2014
Key social media metrics
Figure 167: Key social media metrics, Jan. 2015
Online conversations
Figure 168: Online conversations for select chocolate confectionery brands, by week, Jan. 26, 2014-Jan. 25, 2015
APPENDIX – TRADE ASSOCIATIONS
Food Marketing Institute (FMI)
Grocery Manufacturers Association (GMA)
Specialty Food Association
National Confectioners Association (NCA)
National Association of Convenience Stores (NACS)