The urging by government and health professions that we should eat less sweet stuff isn’t the most helpful of climates for manufacturers.
But they can take comfort from there being two virtually guilt-free trading periods for boxed chocolates when increased sales are guaranteed - Christmas and Easter, whether for gifting or sharing.
The seasonal markets are integral to chocolate confectionery growth overall, accounting for 17% of total chocolate confectionery sales. Sainsbury does 25% of its business during these two periods.
Boxed chocolates is the second largest chocolate confectionery sector, representing nearly 22% of total take-home confectionery sales annually [TNS Superpanel]. They grew at more than 12% last year to £451m.
While the majority of new product development has been in the twist-wrap sector, premium is emerging as a major trend. There’s evidence of more demand for traditional inlaid products, with premium niche players such as Green & Black’s securing wider distribution and major players such as Cadbury Trebor Bassett extending into the luxury end of the market with Roses Luxury Collection (rsp: £4.99).
Jamie Milner, Green & Black’s brand manager, says luxury organic chocolate is the fastest-growing confectionery sector, evidence of which is the brand’s performance with year-on-year growth of 50% compared with total chocolate market growth of 2.1%.
Sales of Lindt’s Swiss Tradition product rose 35% over Christmas last year, and the company itself is growing sales by 55%.
The supermarkets are getting behind these premium offerings. Among the 200-plus confectionery lines Waitrose will list this Christmas is an exclusive Green & Black’s Dark Collection.
Premium Belgium chocolate brand Guylian is also enjoying support from the supermarkets.
“All our multiple account trade partners were keen to repeat the success and growth the Guylian brand offers them year after year,” says Kevin Toms, sales and marketing director.
Mike Tipping, head of customer relations
at Cadbury Trebor Bassett, says the company’s entry into the luxury inlaid box market is a key step in terms of maximising consumer preferences.
“The perceived value to recipients is greater and it’s a more attractive proposition to the purchaser.”
But with 7% year-on-year growth, twist-wrapped remains the major boxed contender. Early entrants Masterfoods’ Celebrations and Cadbury’s Miniature Heroes are among those still leading the market. Kraft Foods has had success with its five variety Terry’s Chocolate Orange Segsations, sales of which rose 94% in the 16 weeks to Christmas last year compared to the single flavour variant the year before, says Easton Millar, trade relations manager.
Toblerone is now available in bitesize format with the introduction of Toblerone One by One Variety, and Nestlé Rowntree is using the format to extend its popular Kit Kat Kubes product with a Kit Kat Kubes Orange gift box, on release in time for Christmas.
Easter remains synonymous with shell eggs, which accounts for 63% of all Easter seasonal confectionery sales, and was worth £159m in 2003, helping to drive growth of 9.1% year-on-year in the Easter confectionery market, says CTB’s Tipping.
“This important season continues to grow as it further cements its place as the number two occasion behind Christmas; some 68% of the UK population either
purchase or receive confectionery,” he adds.
Standard filled eggs such as Cadbury Creme Egg remain a staple of retailers’ Easter offer, but the influence of premium product development is again apparent.
Bendicks is rolling out both mainstream and premium egg offers next year and Guylian is launching a luxury product comprising a chocolate egg and three boxes of its Seashells, La Truffilina and Opus brands with a retail price of £9.99.
Lindt’s Gold Bunny is also set to return, boosted by a 135% sales increase during Easter this year.
As Bendicks’ trade marketing manager, Andy Morrison, observes, premium and large eggs have shown excellent value growth as consumers trade up to special gifts for friends and family.
“This has been helped by improved product choice, with brands such as Thorntons joining Bendicks on many fixtures. It is important for retailers to provide a range that meets consumer demand for both boxed chocolates and Easter eggs,” he says.
For now, at least, the main drivers are sharing in the form of twist-wraps and premium chocolates.
But what of the future? When it comes to indulgence, the festive season remains sacrosanct, but issues such as health and diet will not go away, and already manufactures are responding with low-carb
countline offerings. So how long will it be before this trend impacts the boxed chocolate market too?
Sainsbury predicts minimal demand for low-carb options at Christmas and Easter. “It is still a very small and infant part of the market and in general product range and awareness is still limited.
“Also, Christmas and Easter are when diets tend to go out of the window and real indulgence comes to the fore, so we see the low-carb market as more of an everyday solution, rather than special occasion,” observes a spokesperson.
Although Bendicks does not have plans for a ‘better for you/low-carb’ offering, Morrison agrees there is certainly opportunity in this market for these types of products, and a swift glance across the Atlantic is enough to justify the suspicion that healthier boxed choc options are just around the corner.