Banner Year for Innovation across Confections

Confectionery and snacks are some of the most innovative categories with thousands of new product launches every year. While some never make it into distribution, others become sales powerhouses in a matter of years. In 2018, confectionery had a banner year for innovation, totaling $1.8 billion in new dollars, or, 7.1 percent of total confectionery revenue. That’s compared with an average of 3 percent of revenue coming from new item sales across the store. Innovate, and win.

There were several areas of note driving innovation dollars. Two-thirds of new dollars drive everyday treating, coming from premium and novelty chocolate, non-chocolate chewy and caramel/taffy. Production claims hit it big in 2018:

• Non-GMO, which is a growing claim for categories across the store, added $100 million in chocolate sales in 2018, an increase of 13 percent. In non-chocolate, products carrying the non-GMO claim grew sales by 9 percent, or an added $37 million.
• Organic continues to be a core driver in chocolate confections, driving a 9 percent gain or an additional $75 million. This is part of an overall surge in popularity for premium chocolate, defined as $11 per pound or more, which increased 19 percent over 2018.
• Gluten-free is the most prolific consumer-demanded attribute in confections that drove an added $400 million in chocolate (+14 percent) and $288 million for non-chocolate.
• The fastest-growing attribute in confections is Fair Trade that has recorded nearly 70 percent growth since 2015.

Confections delivered growth for grocery, mass, convenience stores and dollar in 2018. Only club and drug stores continue to lag due to struggles outside the category related to declining trips and/or household engagement at the channel level. Whereas grocery stores won big in chocolate, convenience stores had record performance in non-chocolate. E-commerce also continues to bolster confectionery, reaching nearly $1 billion in online sales. Confectionery e-commerce sales have tripled in just two years time. Offering a seamless omni-channel experience, along with being a fun and inspiring candy destination allows brick-and-mortar retailers to capitalize on all around innovation dollars.

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