Acosta Group’s Risch Examines The Impact Of New Shopping Behaviors


Share:

Washington — Candy and snacks are considered special treats in nearly every U.S. household and are relevant to most retailers and channels. But as inflationary concerns and struggles continue, half of all U.S. shoppers are buying less and making fewer spontaneous trips to the store for groceries and household needs, with two-in-five buying less candy and fewer snacks.

With many changing dynamics, such as inflation, health and wellness trends, and growing ecommerce, Acosta Group recently conducted shopper research among its proprietary shopper community to better understand candy and snack shoppers. The changing behaviors among candy and snack shoppers provide opportunities for brands and retailers to meet their shoppers’ needs while also driving sales growth.

TIMES ARE TOUGH, WE DESERVE A SNACK OR SWEET

Most of us snack every day. While growth of the candy and snack categories has largely been driven by inflationary pricing rather than unit volume growth, there are pockets of true growth in both units and dollars. What is driving this growth, and why have certain brands and items been able to buck the trend of year-over-year unit declines?

Commonalities include true innovation (e.g., Takis, Tru Fru frozen specialty novelties and Nerds Gummy Clusters) and nostalgia (e.g., Funyuns, Fritos, marshmallows, candy corn and lollipops). Even popcorn is proving to be a recessionary-proof snack. It is low-calorie, shareable, portable and — yes — affordable.

One thing certainly rings true. Despite higher prices from inflation and tighter budgets, many shoppers admit to the occasional splurge, with 50 percent saying they splurge on certain items to treat themselves or their families. A few favorites include ice cream, candy, cookies and chocolate — most likely because 68 percent of shoppers describe snacks as “comfort food to feel better,” with the top three comfort go-to items being ice cream, chocolate and potato chips.

TASTE IS STILL WHAT MATTERS

Among both candy and snack buyers, taste is by far the most important factor when making a purchase decision, although good value is also very important. For candy buyers in particular, high-quality ingredients and a trusted or favorite brand name are key drivers of choice.

Only 13 percent of shoppers are looking for lower sugar and 9 percent are looking at calorie count. Shoppers would love to have better-for-you snack options, but not at the expense of taste. One example: even though more than half of chocolate buyers buy dark chocolate, it is favored more for taste than for its potential health effects.

Snack shoppers are a divided group: half prefer better-for-you snacks and half prefer what they self-describe as “junk food.” But ideally, they say that they want both — snacks with a positive nutritional profile that taste good. Millennials are a key demographic for the snacking industry and tend to choose better-for-you options. Most are also willing to pay more for natural and organic snacks as they prioritize healthy lifestyles and the environment.

CANDY, SNACKS ARE BOUGHT ANYWHERE, EVERYWHERE

While grocery and mass are the top two channels for candy and snacks, small format channels play a critical and unique role. Candy and salty snacks are the number two and three most purchased items by drug store shoppers — trailing only over-the-counter medications — and are often unplanned purchases.

Candy and snacks are also particularly important for convenience stores as they can be a key traffic driver. Convenience stores drive the highest buying frequency across almost all candy and snack types. In particular, 68 percent of convenience store shoppers buy salty snacks at least once a week, and more than half buy candy bars at least weekly. One-third of shoppers make a special trip to purchase snacks at convenience stores.

SELF-CHECKOUT’S IMPACT ON UNPLANNED BUYS

While half of shoppers purchase snacks to restock the pantry when they run out, unplanned buying continues to be a big contributor to candy and snack sales, with nearly four-in-10 shoppers making the spontaneous decision to purchase these items.

But as self-checkout lanes become more common — used by about three-in-four shoppers — these purchases might be at risk, especially for candy. More than a quarter of all candy sales occur at checkout, yet candy conversion at self-checkout is half that at a regular checkout lane, according to Impulse Marketing. There is also a significant opportunity to encourage candy buying at checkout among online shoppers, as only one-in-10 online snack buyers have purchased candy online.

KEY TAKEAWAYS

Recessionary behaviors bode well for candy and snacks if consumer needs are met. As shoppers struggle with the impact of higher prices, it’s important to provide frequent promotions and be clear and transparent about the value proposition. It’s not just about price, but instead about an affordable luxury for customers to treat themselves and their families.

Challenge your assortment and innovation plans by channel, including drug and convenience stores where candy and snacks are top purchases among shoppers. Consider adding better-for-you options that shoppers are willing to pay more for, such as natural and organic items. However, keep in mind that taste and indulgence will still always rule.

Spur-of-moment purchases boost the category and give shoppers something to look forward to, so it’s critical to stay informed on the impact of the rising self-checkout trend. Partner with retailers to create effective merchandising strategies to minimize lost sales at self-checkout lanes as more are deployed over time.

Ecommerce will continue to grow in relevance and currently provides an opportunity to increase sales and basket size by promoting candy and snack items during online checkout.

Contributor Info: Kathy Risch is the senior vice-president of consumer insights & thought leadership at national sales and marketing services provider Acosta Group. She can be reached at [email protected].