There’s no doubt about it. The egg came before the chicken in Easter confectionery… but the chicken made up for lost time in 2012.

As sales of Easter eggs - traditional shell eggs, mini eggs and filled eggs - fell 3.3% in value and 2.7% in volume, chocolate novelties jumped 3.1% in value and 4.5% in volume [Kantar Worldpanel 16 w/e 8 April 2012].

Chicks and bunnies aren’t the only cute animals to thank. Notable newcomers in 2012 included chocolate sheep from Thorntons and Mint Aero Lambs, as well as an entire Easter Farmyard from brand owner Nestlé.

And as brands look to stem the 2% fall in value and 1.8% slip in volume in the overall Easter confectionery market last year, the menagerie is set to get even bigger, not just in terms of animals. Everything from toys to cutlery and even carrots are set to make an appearance this Easter.

But can novelties really drive value back into a category that has slipped into reverse after growing 4.8% in value and 6.4% in volume in 2011? What landed the Easter egg in hot water in the first place? And what can be done to restore it to growth?

Easter eggs certainly have a lot of ground to make up. Value and volume sales of shell eggs, which make up almost 60% of the market, slumped 2.1% and 5.5% respectively last year [Kantar]. That’s despite 85% being sold on deal, which although down marginally on 2011’s 86.4%, suggests that the fall in deal depth from 29.9% to 24.6% hit shoppers hard [SymphonyIRI 20 w/e 14 April 2012].

“We identified a gap in the market for a gift-worthy egg between large & super premium” Aimee Cowan, Mondelez International

It was the brands that suffered, with value sales falling 3.4% and volumes down 6.3%. Conversely, own-label shell eggs surged 40.1% in value and 47.5% by volume, albeit from a smaller base.

Changing promotional tactics are not all that’s to blame for the brands’ woes though. Stiffening competition from novelties also played a key role, argues Karen Crawford, commercial director at luxury chocolatier and owner of the Mint Crisp brand Elizabeth Shaw, and there is little respite in sight.

“Cheaper, more accessible novelties will continue to steal share from shell eggs as consumers seek new and different but cost-effective solutions,” she predicts.

To make matters worse, the competition is increasingly likely to come from own-label, as well as branded players. Sainsbury’s is looking to follow in the footprints of Lindt’s gold bunny and Nestlé’s Smarties Little Choc Chick (launched last year) with a host of new “lower priced novelty items” for Easter 2013, says confectionery buyer Marie-Claire Lisk.

“Cheaper novelties will continue to steal share as consumers seek cost-effective solutions” Karen Crawford, Elizabeth Shaw

With new branded novelties also being lined up - such as Lindt’s first novelty hen, launched exclusively in Waitrose this month [rsp: £1.39 for 35g], and Ferrero Rocher’s first novelty hollow bunny (rsp: £2.99 for 100g), also unveiled this month - the pressure on brands reliant on chocolate eggs is mounting.

That’s not to say eggs have completely fallen out of favour. While mainstream brands have suffered in the shell, filled and mini Easter egg categories, those at the more premium end of the spectrum claim sales have been strong.

“Contrary to the marketplace, Sainsbury’s has seen growth in Easter sales over the years,” says Lisk, pointing to the retailer’s development of higher-end own-label options for Easter. “Our premium Taste The Difference range is a success year-on-year and we will continue this offering.”

  • The take-home Easter confectionery market slumped in value and volume last year, although the impact was mitigated to some extent by remaining shoppers buying more frequently during the 16-week Easter period.
  • Novelties performed strongly, with growth being driven by new shoppers attracted by NPD. A large proportion of this spend came at the expense of other categories, in particular shell eggs.
  • Hanging bags grew strongly, albeit from a low base. Like novelties, the main driver of growth was new shoppers who did not shop the category in 2011.
  • Shell eggs, which accounted for over half of Easter spend, declined due to shoppers purchasing less frequently than in 2011.
  • Filled eggs also declined in value, although volumes rose 7.4%, while mini eggs fell in value and volume.

Ed John, Kantar Worldpanel

Premium opportunities

Many branded players are pinning their hopes on premiumisation too, claiming that consumers often regard them as offering better value for money, paradoxically, than cheaper alternatives.

“Premium shell eggs offer a real opportunity to add value as many consumers look for a quality product from a brand they can trust,” says Crawford. “Consumers are becoming more savvy to promotional mechanics and do not want to buy into multibuys for fear of waste and cost and do not trust heavily discounted lines positioned at artificially high prices only to be slashed to half price.”

“We have taken a much more active role in driving sales around key events like Easter” David Costello, Burton’s Biscuits

The brands haven’t wasted any time tapping into this growth area. Ferrero has added to its 275g luxury Rocher shell egg range with the launch of a 100g medium variant this month. “The smaller size means consumers can indulge in the same luxurious taste and look for less,” says Levi Boorer, customer development director for Ferrero.

Thorntons, meanwhile, is investing in luxury shell eggs with a three-strong range of inclusion eggs in Black Forest Gateau, Banoffee Pie and Tempting Trifle flavours. Aimed at adults and in store this month, the eggs carry an rsp of £10 each.

The egg category needs all the innovation it can get. In value terms, the mini eggs sub-category was the biggest casualty of Easter 2012, enduring a 9% slump in sales against a 1.4% decline in volumes. While the booming population of chocolate novelties undoubtedly had a hand in this, owners of the main lines in the mini egg sub-category - which include offerings from Mars, Nestlé and Ferrero - say another culprit was also at work.

“Hanging bags that target the top end of the mini eggs category are a key growth segment,” says Ferrero’s Boorer. Indeed, despite making up just 1.3% of market value share, hanging bags of Easter goodies such as Mars’ Malteaster Mini Bunnies and Kraft’s Cadbury Creme Egg Splats are growing at a blistering pace, with value growth of 113.3% and volumes up 48.2% [Kantar].

Filled eggs fared only marginally better than their miniature aisle-mates in 2012, with value sales falling 4.2%. Although filled egg volumes climbed 7.4%, this was chiefly down to increasing reliance on multipacks, says Kantar Worldpanel analyst Ed John. “While volume in kilos is up, the actual number of packs is down,” he says “Shoppers are switching from smaller to larger formats buying fewer of them but at a higher volume.”

Egg and spoon race

“Smaller sizes mean that consumers can indulge in the same luxurious taste and look for less” Levi Boorer, Ferrero

Inevitably, this is driving value out of filled eggs. This year, a number of players are looking to restore the sub-category back to value growth with a host of innovations. Mondelez International is bringing its Egg ‘n’ Spoon filled chocolate eggs to the UK market for the first time under the Cadbury brand, following the runaway success of a Milka version in Germany, where Mondelez says they now account for 12% of Milka’s Easter sales.

Complete with plastic purple spoons to scoop out the mousse centre, the packs of four are designed with the whole family in mind, according to Aimee Cowan, brand manager for Easter at Mondelez International. “Egg ‘n’ Spoon is designed for occasions when families sit down and enjoy this seasonal treat together,” says Cowan. “We have identified a gap in the market for this kind of gift-worthy egg that fits between large and super-premium gift eggs.”

Mondelez isn’t the only player trying to shake things up with something a bit more innovative than the traditional egg and sweets or mug formats. Lindt has created a hutch for its Gold Bunny family and in an exclusive deal with Tesco it is selling fluffy bunny ears with its 50g Gold Bunnies. The set, which it says is “perfect for bunny hunters”, costs £4.99 and will be launched in Tesco this month.

Instead of filling yet more eggs, Lindt has also launched an entirely new concept for 2013: filled carrot-shaped chocolates. The Milk Chocolate Carrot Treats, launched this month, come in a bite-size 13.5g package with a double milk filling. “This will add something completely new and novel to this segment,” says Kevin Pratt, senior brand manager for Easter at Lindt.

Biscuit-makers muscle in

“Easter is becoming an occasion like Christmas. Consumers are willing to treat themselves” Pat Thomas, Premier Foods

But brands aren’t putting all their eggs in the chocolate confectionery basket. They are also looking to biscuits and cakes.

Burton’s Biscuit Company is launching a spring biscuit assortment tin under the Cadbury brand next month in a bid to widen the Easter window. Featuring a special spring design, the tin is being marketed as a ‘springtime gift’. “We’ve taken a much more active role in driving sales around key calendar events, such as Easter,” says David Costello, category and activation controller at Burton’s.

Premier Foods is also hoping to make more of the festival with two new Easter special editions: Cadbury Caramel Cakes (not to be confused with Caramel Cake Bars, launched in 2009) and Cadbury Lemon Crème Cake Bars. “Easter is becoming more of an occasion like Christmas and consumers are willing to indulge or treat themselves,” reasons Pat Thomas, head of insight at Premier. “Both new offerings target shoppers looking for something new.”

Easter is becoming more important to manufacturers and retailers, but it isn’t the only Spring event they are targeting. “Occasions such as Valentine’s Day and Mother’s Day offer clear sales opportunities for retailers to take advantage of in addition to Easter,” says Mars trade communications manager Bep Dhaliwal, citing the broad appeal of products such as Mars Celebrations and Maltesers. “Small and large boxes represent an ideal gifting and sharing option, particularly during the spring period.”

Ferrero clearly had one of these occasions in particular in mind when it launched its ‘extra special’ Rocher Heart this month. “The golden heart-shaped box design has a premium look at an affordable £4.49 price point,” contends Ferrero’s Boorer. “By focusing on best-selling boxed chocolates, retailers can increase their sales across the combined occasions of Valentine’s Day, Mother’s Day and Easter. These products also continue to sell once spring has sprung.”

NPD will also benefit from the relatively late date on which Easter falls, giving brands plenty of time to push their marketing messages. “We anticipate category growth in 2013 strengthened by Easter having a full eight weeks of consumer focus before March 31,” says Thomas.

Premier intends to make the most of those eight weeks. A Cake Hunt push targeting 160,000 shoppers will run across 54 supermarkets nationwide, encouraging consumers to count brightly coloured egg stickers in-store for the chance to win Easter goodies. A press campaign will also use augmented reality technology to link consumers to an Easter chick game offering e-coupons.

Ferrero has made its biggest ever investment in TV advertising with a £8m campaign for its Kinder range. Running throughout 2013, the ads feature a 10-second spring tag encouraging children to hunt for Easter variants from 4 March until Easter. “This is set to give us a leading share of voice in kids’ confectionery and ensure we are front of mind with mums during Easter,” says Boorer.

It is mums (and dads) Lindt is targeting with its competition to win a ‘24 carrot gold’ holiday worth up to £10,000 every week for 10 weeks on packs of its hollow Gold Bunny figures. Consumers register a unique code found on pack online between January 27 and April 7 for a chance to win. “The promotion will drive incremental sales of the Gold Bunny early in the season,” says Pratt.

After all, it is incremental sales that the category sorely needs. Not to mention more space for the growing menagerie of chocolate animals.