An onslaught of new flavors and licensed brands are transforming the candy cane sector, and consumers are responding.
Cleveland — Might candy canes eventually evolve into everyday treats, or at least expand beyond the traditional winter holidays? Depending on which candymakers and analysts you ask, the answers range from definite maybes to not likely. All, however, agree the segment represents a cornucopia of innovative flavors and licensed brands with no end in sight.
For lovers of cookies, cereal and sweetened drinks, brisk-selling licensed candy cane brands include Oreo, Froot Loops, Kool-Aid and A&W Root Beer. For everyday candy fans the number of brands lending their names and flavor profiles to the cane sector include Jelly Belly, Alexander the Grape, Hot Tamale, Johnny Apple Treats, Lifesaver, Nerds, Starburst and SweeTarts, just to name a few.
“Such innovations help consumers relive childhood memories while creating new ones,” says Mariah Havens, marketing director — seasonal at Ferrara Candy Co., Inc.
For fruit lovers, the past few years have seen launches of cherry, strawberry and watermelon-flavored candy canes, notes Tom Vierhile, vice-president of strategic insights at Innova Market Insights. “Fruit flavors have accounted for more than half of new product innovations in the sector between 2016 and 2020, though mint flavors continue to be most closely associated with candy canes,” he tells Candy & Snack TODAY.
And then there are the entertainment properties, ranging from Disney’s Frozen to LOL Surprise!, Mandalorian, SpongeBob, Star Wars and many others.
“We’re always comparing our portfolio of licenses with where customers are leaning,” says Emily Edmondson, sales director at Galerie USA, LLC. “Licenses continue to evolve, not only with movie releases but with digital streaming offerings as well. We’re nimble and can work with our retail customers on one-offs.”
Lou DiMarco, executive vice-president at Hilco Corp., sees opportunities for the sector based on the interest in social media platforms. “Traditional entertainment properties are competing with the digital options such as YouTube, TikTok, etc. It used to be that kids wanted licensed items associated with characters in the latest movie release, now they want to be the stars in their own social media platform — reviewing candy, toys and even fast food.”
Of course, we have the pandemic to thank for some of that, continues DiMarco. “The trend toward more digital entertainment options began before COVID-19, but the pandemic accelerated it.”
At newly launched 1908 Candy Co., Founder and President Lou Pagano II sees things differently. “There’s a pent-up demand to return to events such as movies. Now that it’s beginning to happen, entertainment products will benefit.”
As for who’s buying, Sally Lyons Wyatt, executive vice-president and practice leader at Information Resources, Inc. (IRI), says the target demographic skews toward gen X parents, while Anne-Marie Roerink, principal at 210 Analytics notes that shoppers of all ages — from tweens and teens to seniors — ensure strong sales November through December.
The absence of a clearly defined demographic speaks to the “terrific job cane manufacturers have done in combining classic items with new and exciting products that appeal to shoppers of all ages and income levels,” says Roerink. “Unlike dark chocolate or gummi candy, there are no distinct buying patterns.”
Multiple Displays Drive Sales
When it comes to placement, sources tell Candy & Snack TODAY that strategic secondary locations, in addition to being on the shelves with other holiday confections, are a must for maximum sales.
Evan Brock, director of marketing at Spangler Candy Co., says retailers miss opportunities for increased sales when they don’t merchandise canes with holiday decorations, as well as bakery and craft supplies. “Creative secondary displays add fun to the Christmas selling season,” he says.
“Consumers want novel, multiuse offerings for snacking and decorating, such as giant candy canes in traditional and non-traditional flavors,” offers Havens.
Edmondson agrees, adding consumers are crushing canes for use as baking ingredients and ice cream toppings, which expands opportunities for secondary placements. Also, retailers shouldn’t overlook the merchandising opportunities afforded by the mini canes, sources report.
“I’ve been particularly impressed with packaging trends in recent years, especially those that include several different flavors and smaller quantity boxes that enable customers to mix and match,” notes Lyons Wyatt.
“Candy canes are definitely an impulse purchase,” confirms Andrew Schuman, president at Hammond’s Candies. “The more you see them throughout the store while shopping, the more likely you are to buy them. Retailers that merchandise canes at store touchpoints beyond seasonal candy, such as bakery departments and register queues, definitely see incremental sales.”
Expanding Beyond Winter Holidays
When it comes to whether canes could transition into everyday items, opinions vary. “Unique flavors such as cotton candy, fruit punch and apple pie already enable us to sell our canes throughout the year,” says Schuman.
On the other hand, Ferrara’s Haven says the company’s priority continues to be the winter holidays, but she adds: “We’re always open to exploring other opportunities outside of the traditional seasonal window.”
Others, including Vierhile, remain skeptical about canes becoming more than Christmas treats. “It’s more likely that we will continue to see flavor innovations broaden to continue attracting the next generation of consumers. Marketing canes outside of the traditional holiday selling season will remain a difficult proposition.”
Perhaps, but cane makers and retailers could borrow a page from the Thanksgiving turkey playbook, suggests Roerink. More than 80 percent of turkey is sold in November and December, she explains. “But turkey sales in the off months have been helped by new items, such as a pre-marinated, oven-ready tenderloin. Such product innovations for everyday occasions have helped increase off-season turkey revenue. Likewise, candy canes have an opportunity to do that with a Christmas in July push promoting crushed candy canes for ice cream or products associated with summer fun, such as Kool-Aid-flavored canes.”
Other seasonal candy forms, such as Easter Peeps, have found success beyond their traditional season, notes Lyons Wyatt. “So it would make sense for cane makers to consider innovations that could generate sales outside of the core months of November and December, though that won’t be easy,” she says, adding she can envision summer promotions.
“Whether its new flavors, formats or licensed brands, it’s all about bringing new shoppers to the segment,” explains Brock, adding he doesn’t see canes expanding beyond their current role — “An indispensable piece of our Christmas tradition.”
Looking ahead, Roerink says the sector’s key to growth is ecommerce. “Candy cane manufacturers need to look beyond brick-and-mortar sales and develop omni-channel sales strategies.”
DiMarco agrees, telling Candy & Snack TODAY: “Retailers often ask, ‘How do I compete with Amazon?’ The answer — Be entrepreneurial. Dedicate more space to more new flavors and brands. Like the big retailers, Amazon carries the top 10 brands, but they’re also carrying another 20 new flavor profiles.”
Among the new rollouts for this year, DiMarco says to expect more innovations such as candy canes with powdered dips and crème-filled offerings, while Brock says to look for Skittles branded canes.
“As cane makers introduce brands and flavors based on consumer-trend data and retailer input, there’s an element of risk,” says Pagano. “It’s a little like playing roulette. Some of the new products will succeed; others won’t. But you have to spin the wheel to find out.”
