Confectionery, Snack Growth Opportunities: The 60,000-Foot View


Share:

Washington DC — The past two years have been a rollercoaster ride with change as the only constant. Americans’ home-centric lives drove record sales for confectionery and snacks. “Confectionery sales reached nearly $37 billion and snacks $77.5 billion in 2021,” said Anne-Marie Roerink, president of 210 Analytics, LLC. “That begs the question, now what? How do we maintain these record numbers? Or better yet, how do we continue to grow?” 

In a session titled Candy & Snack Growth Opportunities: The 60,000 Foot View at the recent Sweets & Snacks Expo, Roerink identified mega trends she said will take confectionery sales to $45 billion and snacks to $93 billion by 2026. 

Consumer Mobility — “Despite the enormous amount of change in our world, ultimately we are not the ones in charge,” said Roerink. “But we do all have the same boss, and that’s the consumer and they’ve been through the ringer.” Citing IRI’s April shopper survey, Roerink mentioned that 44 percent of American households are making sacrifices to make ends meet amid 40-year high inflation. This has driven home-centric lives, whether work, meals, entertaining or celebrations, which provides many opportunities for movie nights, beverage, dessert and snack moments at home for candy and snacks. 

Addressing The Big Elephants — Talk of inflation and shortages is everywhere and consumers are hyper aware and concerned. Both confectionery and snacks are averaging year-on-year inflation well above the 10 percent mark in the first quarter of 2022. This has many consumers looking for promotions, but fewer can be found. In-stock rates are well below typical levels, at 86 percent for snacks and 81 percent for confectionery. “You can’t sell what you don’t have,” said Roerink. “Both candy and snacks are items where people have their proven favorites. Provide suggestions and communicate about the supply chain issues as out-of-stocks have a big impact on trip satisfaction.”

Migration Patterns — In addition to the many jobs that have moved to the home, migration patterns are affecting candy and snack sales geographically. Roerink shared statistics of big influxes into Arizona, Florida, Texas, Idaho and the Carolinas during the past two years. It is precisely these areas that have seen above average growth in candy and snacks. 

For regional brands, online consumer-direct sales could be a way to maintain sales. “Additionally, we’ve seen a reversal of urbanization over the past few years,” said Roerink. “Suburban grocery trips are very different from urban ones. Urban trips are more frequent and smaller, which means a lot of visibility and purchase moments for candy and snacks — something we need to account for in larger pack sizes and secondary displays in larger, suburban stores.”

Innovative Ways Of Selling — From drones to robots, technology has prompted a host of new models. Consumer direct models target large baskets and innovative offerings. They pull both consumption and gifting dollars out of the store. Subscriptions, by traditional retailers and online players, remain a popular way to increase “shopper stickiness.” Ecommerce remains an area of opportunity, expected to reach 12.5 percent of total food and beverage sales. But impulse categories lag in online penetration and winning that first click should be a priority, according to Roerink.

Social Media — Candy and snacks are social media darlings, whether Instagram or TikTok. Two-thirds of Americans have researched confectionery ideas on social media and 42 percent have participated in TikTok food eating challenges. Viral trends can drive tremendous spikes, as illustrated by the #slimelicker example that drove a 1,700 percent increase in unit sales. “Have a plan for if/when your item goes viral,” Roerink stressed to attendees. “Viral trends can be an enormous sales opportunity, but also a risk as they come and go quickly.”