Chocolate Confectionery - UK - May 2019

OVERVIEW
What you need to know
Products covered in this report
EXECUTIVE SUMMARY
The market
Volume growth returns in 2018
Figure 1: Forecast of UK retail value sales of chocolate, 2013-23
Chocolate confectionery continues to dominate sales
Figure 2: UK retail value sales of chocolate, by segment, 2016-18
Rising prices affect the market
Improved household incomes give opportunities for premium products
Companies and brands
Brands dominate NPD, with Nestlé taking the lead
Chocolate brands look to cater to health trends through NPD
Vegan claim rises in 2018
Advertisers maintain support in 2018, with Cadbury Dairy Milk the top-spending brand
Cadbury Dairy Milk leads on trust
The consumer
92% of Brits eat chocolate; 59% do so daily
Figure 3: Frequency of eating chocolate, March 2019
Single-serve bars remain the most popular format
Figure 4: Types of chocolate eaten, March 2019
Supermarkets are the most popular place for buying chocolate
Figure 5: Retailers from which chocolate confectionery is purchased, March 2019
People are prepared to pay for a luxury brand when buying a gift
Figure 6: Attributes consumers are willing to pay more for in chocolate bought as a gift and for themselves, March 2019
68% would rather have less of regular chocolate than a larger amount of low-sugar
Figure 7: Behaviours related to chocolate, March 2019
Taste is important to 87%
Figure 8: Attitudes towards chocolate, March 2019
What we think
ISSUES AND INSIGHTS 
Manufacturers face opposing demands regarding sugar reduction
The facts
The implications
‘Less but better’ trend is driving premiumisation in chocolate
The facts
The implications
Ethical/environmental issues spark mixed reactions
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Volume growth returns in 2018
Value and volume growth predicted over 2018-23
Chocolate confectionery continues to dominate sales
Rising prices affect the market
Improved household incomes give opportunities for premium products
Decline in 25-34s and children could adversely impact the market
MARKET SIZE AND FORECAST
Volume growth returns in 2018
Figure 9: UK retail value and volume sales of chocolate, 2013-23
Value and volume growth predicted over 2018-23
Figure 10: Forecast of UK retail value sales of chocolate, 2013-23
Figure 11: Forecast of UK retail volume sales of chocolate, 2013-23
Forecast methodology
MARKET SEGMENTATION
Chocolate confectionery continues to dominate sales
Figure 12: UK retail value and volume sales of chocolate, by segment, 2016-18
MARKET DRIVERS
Rising prices affect the market
Improved household incomes give opportunities for premium products
Figure 13: CPI vs average weekly earnings, 2013-18
Uncertainties surround consumer finances post-Brexit
War on sugar continues
Manufacturers are tasked with cutting sugar
Calls grow for stronger action to be taken to tackle sugar
Progress made on sugar reduction technologies
Parents under pressure to reduce their children’s sugar intake
Snacking should boost chocolate
Pressure grows on the food industry to reduce packaging waste
Decline in number of 25-34s and children could adversely impact market
Figure 14: Change in age structure of the UK population, 2013-18 and 2018-23
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Cadbury Dairy Milk retains top position in chocolate confectionery, but sees sales fall
Lindt continues to lead in chocolate assortments
Cadbury Dairy Milk takes the top position in seasonal chocolate
Brands dominate NPD, with Nestlé taking the lead
Chocolate brands look to cater to health trends through NPD
Vegan claims rise in 2018
Advertisers maintain support in 2018, spending almost £95 million
Cadbury Dairy Milk leads on trust
MARKET SHARE
Cadbury Dairy Milk retains top position, but sees sales fall
NPD boosts Maltesers, but other Mars brands struggle
Figure 15: Leading brands’ sales and shares in the UK retail chocolate confectionery market, by value and volume, 2018 and 2019
Lindt continues to lead in chocolate assortments
Figure 16: Leading brands’ sales and shares in the UK retail chocolate assortments market, by value and volume, 2018 and 2019
Cadbury Dairy Milk takes the top position in seasonal chocolate
Figure 17: Leading brands’ sales and shares in the UK retail seasonal chocolate market, by value and volume, 2018 and 2019
START-UPS AND DISRUPTORS CASE STUDY – MIA CHOCOLATE
Company overview
What is it?
Founded
Company mission statement
Founder’s story
Sources of funding and support
Mintel analyst View
Mintel Trends
Why it could succeed
Why it could fail
The verdict
The product
Figure 18: Sample of MIA product listing, April 2019
Figure 19: MIA product range, April 2019
Purchase Intelligence (PI)
Figure 20: Perception map of attribute performance of MIA Dark Chocolate and MIA Cranberry & Hazelnut Dark Chocolate in comparison to Single Origin Chocolate among UK consumers, April 2018- April  2019
Product stockists
Social media metrics
Figure 21: Social media metrics for Company as of April 2019
LAUNCH ACTIVITY AND INNOVATION
Brands dominate NPD, with Nestlé taking the lead
Figure 22: Share of new product launches in the UK chocolate confectionery market, by company, 2015-19
Figure 23: Selected KitKat launches, 2019
Cadbury and Galaxy launch dark varieties
Figure 24: Cadbury and Galaxy launch dark chocolate versions, 2018 and 2019
Brands and own-label chocolate perform equally on purchase intent
Brands outperform own-label chocolate on perceptions of quality, excitement and taste, on average
Figure 25: Perception map of attribute performance of own-label chocolate in comparison to branded chocolate among UK consumers, April 2018-March 2019
Sainsbury’s pushes exclusive brand
Figure 26: Sainsbury’s launches Cocoa et Co Easter egg, 2019
Chocolate brands look to cater to health trends through NPD
Cadbury focuses on sugar reduction through fibre
Mars Wrigley looks to protein to bring down sugar and calorie content
Figure 27: Cadbury unveils Boost + Protein, 2018
Looking to fruit and grains for better-for-you credentials and texture
Vegan claim rises in 2018
Hotel Chocolat launches free-from range …
… and hosts vegan tasting events
Sharing remains a key occasion for NPD
Brands look to larger bags
Figure 28: Brands launch bigger sharing bags, 2018 and 2019
Buttons for Bournville and Maltesers
Figure 29: Maltesers moves into buttons, 2018
Nestlé extends Milkybar with Mix Ups, McVitie’s launches Jaffa Cakes Nibbles
Figure 30: Nestlé emphasises shareability in repackaged Aero bar, 2018
Figure 31: McVitie’s eyes sharing occasion with Jaffa Cakes Nibbles launch, 2019
Premium launches see a slight rise as manufacturers look to add value
Maltesers and Aero expand everyday premium with boxed chocolates
Figure 32: Maltesers launches Truffles, 2018
Premium products look to bars and tablets
Lir returns to the UK
Quality ingredients, provenance and adult flavours trends continue
Calling out quality ingredients
Single origin
Figure 33: Premium Easter egg launches, 2019
Seasonal products aim to offer theatre
More potential for adventurous flavours
Ethical/environmental innovation
Tesco completes move to 100% sustainable chocolate
Plastic packaging comes under public spotlight
Tony’s Chocolonely launches with slave-free claim
Figure 34: Tony’s Chocolonely launches in the UK, 2019
Quality Street looks to theatre with John Lewis tie-up
Figure 35: Quality Street activation at John Lewis, 2018
ADVERTISING AND MARKETING ACTIVITY
Advertisers maintain support in 2018, spending almost £95 million
Figure 36: Total above-the line, online display and direct mail advertising expenditure on chocolate, 2015-18
Mars regains top spot after increasing spend in 2018
Galaxy sees spend reduced
Maltesers launches digital-only campaign
Snickers turns to Elton John for ‘You’re not you when you’re hungry’ campaign
Figure 37: Total above-the line, online display and direct mail advertising expenditure on chocolate, by top 10 spending advertisers (sorted by 2018), 2015-19
Mondelēz cuts spend further
Cadbury Dairy Milk continues kindness theme
Cadbury Darkmilk targets grown-ups with nostalgic ads
Cadbury amends Freddo Treasures campaign following complaints
Cadbury Creme Egg hacks other brands’ ads for hunting season
‘Human charging points’ to beat afternoon slump with Boost
Figure 38: Total above-the line, online display and direct mail advertising expenditure on chocolate, by top 10 spending brands (sorted by 2018), 2015-18
Nestlé increased support for its brands in 2018
Tesco focuses on sustainability through Food Love Stories
Nielsen Ad Intel coverage
BRAND RESEARCH
Brand map
Figure 39: Attitudes towards and usage of selected brands, April 2019
Key brand metrics
Figure 40: Key metrics for selected brands, April 2019
Brand attitudes: Cadbury Dairy Milk stands out on trust
Figure 41: Attitudes, by brand, April 2019
Brand personality: Maltesers is seen to be the most fun
Figure 42: Brand personality – macro image, April 2019
Lindt Lindor has a strong image as special and indulgent
Figure 43: Brand personality – micro image, April 2019
Brand analysis
Cadbury Dairy Milk leads on trust, comfort and providing good value, and on being seen as the favourite brand
Figure 44: User profile of Cadbury Dairy Milk, April 2019
Maltesers stands out for being fun and family-focused
Figure 45: User profile of Maltesers, April 2019
Lindt Lindor is seen widely to offer consistently high quality, contributing to its special image
Figure 46: User profile of Lindt Lindor, April 2019
KitKat seen widely to be trustworthy, accessible and traditional
Figure 47: User profile of KitKat, April 2019
Galaxy is seen widely as delicious
Figure 48: User profile of Galaxy, April 2019
Hotel Chocolat is seen to be the most exclusive brand
Figure 49: User profile of Hotel Chocolat, April 2019
Kinder seen to have a family focus
Figure 50: User profile of Kinder, April 2019
THE CONSUMER – WHAT YOU NEED TO KNOW
92% of Brits eat chocolate; 59% do so daily
Single-serve bars remain the most popular format
Supermarkets are the most popular place for buying chocolate
Many people are prepared to pay for a luxury brand when buying a gift
68% would rather have less regular chocolate than a larger amount of low-sugar
‘Less but better’ trend is evident
Taste is important to 87%
Ethical/environmental issues spark mixed reactions
USAGE 
92% of Brits eat chocolate; 15% do so daily
Figure 51: Frequency of eating chocolate, March 2019
Single-serve bars remain the most popular format
Figure 52: Types of chocolate eaten, March 2019
Milk chocolate is the most popular type
Figure 53: Varieties of chocolate eaten, March 2019
Figure 54: Crossover in varieties of chocolate eaten, March 2019
WHERE CHOCOLATE IS PURCHASED
Supermarkets are the most popular place for buying chocolate
A third buy chocolate from the discounters
Figure 55: Retailers from which chocolate confectionery is purchased, March 2019
Specialist stores are still very niche
ATTRIBUTES SHOPPERS ARE PREPARED TO PAY MORE FOR 
People are prepared to pay for a luxury brand when buying a gift
Figure 56: Attributes consumers are willing to pay more for in chocolate bought as a gift and for themselves, March 2019 
A minority would pay more for hand-crafted/hand-made chocolate
Personalisation could boost gifting further
Mass-market brands look to mass-personalisation
Niche brands go further
An exciting flavour is the top factor people would pay more for when buying chocolate for themselves
BEHAVIOURS RELATED TO CHOCOLATE 
68% would rather have less regular chocolate than a larger amount of low-sugar
Cadbury looks to fibre to reduce sugar
Smaller portions aid efforts to limit consumption
Figure 57: Behaviours related to chocolate, March 2019
‘Less but better’ trend is evident
ATTITUDES TOWARDS CHOCOLATE
Taste is important to 87%
Own-label’s ability to deliver on taste divides chocolate eaters
Figure 58: Attitudes towards chocolate, March 2019
Ethical/environmental issues spark mixed reactions
Palm oil is seen as off-putting by 49%
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Forecast methodology
Figure 59: UK value sales of chocolate, best- and worst-case forecast, 2018-23
Figure 60: UK volume sales of chocolate, best- and worst-case forecast, 2018-23
APPENDIX – MARKET SHARE 
Figure 61: Leading manufacturers’ sales and shares in the UK retail chocolate confectionery market, by value and volume, 2018 and 2019
Figure 62: Leading manufacturers’ sales and shares in the UK retail chocolate assortments market, by value and volume, 2018 and 2019
Figure 63: Leading manufacturers’ sales and shares in the UK retail seasonal chocolate market, by value and volume, 2018 and 2019
APPENDIX – LAUNCH ACTIVITY AND INNOVATION 
Figure 64: Share of new product launches in the UK chocolate confectionery market, by brands vs own-label, 2015-19
Figure 65: Share of new product launches in the UK chocolate confectionery market, by sub-category, 2015-19
Figure 66: Share of new product launches in the UK chocolate confectionery market, by claim category, 2015-19
Figure 67: Share of new product launches in the UK chocolate confectionery market, by claim, 2015-19
Figure 68: Share of new product launches in the UK chocolate confectionery market, by launch type, 2015-19
Figure 69: Share of new product launches in the UK chocolate confectionery market, by top 10 flavour components, 2015-19
Figure 70: Perception map of attribute performance of Cadbury in comparison to branded chocolate among UK consumers, April 2018-March 2019
APPENDIX – USAGE 
Figure 71: Repertoire of types of chocolate eaten, March 2019