The Bottom Line:
- The chocolate category showed growth
- Novelty chocolate candy sales have declined
- Consumers are interested in premiumization
Chocolate is a treat that will never go out of style—whether it’s a consumer purchasing it for their own consumption, or perhaps as a gift for friends or family, it is a well-loved dessert. Manufacturers are now experimenting with different flavors and textures to appeal to consumers’ discerning palates.
Market data
According to Circana (Chicago) data from the past 52 weeks, ending on May 21, the chocolate candy category overall grew by 9.2% as compared to the same time period last year, with sales of $18.78 billion.
The “chocolate candy box/bag/bar greater than 3.5-oz.” subcategory brought in $7.3 billion of that number, with an 8.4% increase. Leading the pack was Hershey’s, with $1.49 billion in sales and an 8.4% increase; and Mars Wrigley’s M&M’s brand, with $1.16 billion in sales but a slight dip of 1.3%. Hershey’s Reese’s brand brought in $714.2 million in sales, with a 17.1% increase.
The “chocolate candy box/bag/bar less than 3.5-oz.” subcategory accrued $5.57 billion in sales, with a 9.3% increase; Reese’s brand brought in $1.07 billion of that, with a 10.5% increase. M&M’s again placed in the top three, with $796.6 million in sales and an 8.7% increase. Hershey’s brought in $652.9 million, with a 6.2% increase.
The “chocolate candy snack size” subcategory brought in $1.3 billion, with an 11.5% increase in sales. Reese’s and Hershey’s again thrived, with $306.5 million and a 20.8% increase and $266.1 million and an 18.1% increase, respectively; Mars Wrigley’s Snickers brand brought in $148.6 million with a 17.2% increase.
The “gift box chocolates” subcategory brought in $333.3 million in sales, with a slight 2.9% decrease, and with Ferrero leading the way; it brought in $183.8 million in sales and experienced a 6.9% increase. The Queen Anne brand, known for its chocolate-covered cherries, brought in $46.3 million, with a 10.9% increase; Russell Stover brought in $43.6 million, with a 20.1% decrease.
The “sugar-free chocolate candy” subcategory brought in $310 million, with an 8.1% increase, with Russell Stover in first place, at $160.7 million in sales and a 2.6% increase. Lily’s brand, now owned by Hershey’s, brought in $53.1 million, with a slight 3.7% decrease in sales; Hershey’s brought in $38.3 million, with a 38.1% increase.
Companies to keep an eye on in the category include Atkins (which brought in $10.2 million in sales but experienced a 150.7% increase) and Nature’s Intent (bringing in $1.38 million but with a 267.2% increase).
Finally, the “novelty chocolate candy” subcategory brought in $1.28 million in sales but declined by 29.1%. Frankford brought in $1 million of that, with a 33.8% decrease in sales; the Nucita brand brought in $122,000, with an 86.5% increase in sales. Thirdly, Helmuth brand received $60,300 in sales, with a 20.4% decrease. The Dippin Dots brand, while only experiencing $14,170 in revenue for the time period, experienced a whopping 981.9% increase in sales.
Looking back
“Premiumization continues to be an important trend following the pandemic. Consumers continue to look for more in their products—more interesting flavors and textures, more quality, and more uniqueness. You can see this in the growth of upscale mainstream and premium chocolate relative to mainstream chocolate,” says Shalini Stansberry, vice president of marketing for Kinder Snacking, Ferrero. “Flexibility is also important, as people want more options in packaging and portions.”
Norman Love, founder and CEO, Norman Love Confections, agrees, saying that premium chocolate has been prevailing in the chocolate market.
“At Norman Love Confections, we continue to offer new flavors such as coffee and doughnuts. Other specialty boxes include Fruit Favorites Gift Box, Champagne, and Strawberries, and a Dark Chocolate Gift Box,” Love says. “This year, our company is focused on continued e-commerce growth as well as increasing our corporate outreach for gifting, beyond the traditional holiday season.”
“Norman Love Confections continues to introduce new specialty boxes and is introducing a new Core Collection featuring six new flavors, including 45% Bahibe, a pure cacao from the Dominican Republic; a Grand Mariner with orange cognac dark chocolate ganache blossoming with fresh, rich flavor; Café Latte; and a dark chocolate filed with decadent white chocolate and vanilla bean ganache and peanut butter cup,” Love adds.
A spokesperson from The Hershey Company says that confection is a multi-dimensional space that satisfies many consumer occasions across various dayparts.
“We enjoy confection to treat ourselves, reduce stress, satiate hunger, and enjoy snacks alone or in a shared experience with family and friends. Innovation needs to deliver against these specific consumer needs but most importantly, it needs to deliver on taste, texture, and experience,” they note.
While consumers have favorite brands, they also like to explore, especially when their brands aren’t meeting new needs, the spokesperson continues.
“Consumers are more interested in ‘tweaks’ to their favorite brands—a new flavor, ingredient, or other variant—rather than a product overhaul,” they say.
In addition to mixing sweet and salty, chocolate trends also include unexpected flavors, textures, and inclusions as seen in Hershey’s newest limited edition Kit Kat Churro flavor, Hershey’s White Creme with Sprinkles and Popping Candy, and Reese’s Big Cup Stuffed with Reese’s Puffs Cereal.
“We also know that more consumers are looking for options to meet their physical wellness too. Hershey’s portfolio has a growing list of better-for-you chocolate like Lily’s, ONE and FULFIL protein bars, and two new products launched this year, Hershey’s Plant Based Extra Creamy with Almonds and Sea Salt, and Reese’s Plant Based Peanut Butter Cups,” the spokesperson expands. “While our core business remains confection, over the past year, The Hershey Company has built a salty division to expand our salty snacks portfolio and build our snacking powerhouse vision.”
Hershey products released within the last year, not including the ones noted above, include Reese’s Creamy & Reese’s Crunchy cups; Hershey’s Kisses Milklicious; Reese’s Popcorn and Dipped Animal Crackers; Fulfil Triple Chocolate bar; and ONE Bars S’mores.
Mike Gilroy, vice president of trade development and sponsorship, Mars Wrigley, says that the company is “consumer-obsessed,” which means listening to consumers and understanding what resonates with and is relevant to them.
“Through research and insights, we also stay current on the flavor trends that are popping up in culture. Across our chocolate portfolio, we have unveiled several new insight-backed offerings that deliver on shoppers’ evolving requests for a wider variety of products,” he shares. “Our latest permanent flavor announcement from M&M’s is also a great example of an on-trend category offering. We tapped into the booming cold brew coffee scene and paired it with a confectionery favorite—caramel—to launch M&M’s Caramel Cold Brew as a fun twist to an on-trend favorite that delivers an exceptional coffee flavor experience.”
“While there’s been explosive growth in e-commerce as shoppers are increasingly choosing different methods of shopping for speed and convenience, consumer behaviors continue to show that shoppers are craving one-on-one connections with brands,” Gilroy continues. “Across our brands, we’re focused on creating connected and immersive shopping experiences for our customers—both online and in-store.”
Gilroy says that Mars Wrigley supports its wholesale and retail partners with creative 360-degree media campaigns to amplify the experience in-store. It also helps its retail partners activate against brand campaigns and key moments with a range of display vehicles and promotional support, including digital activations, to capture and maximize on the impulse nature of the confectionery category.
“We are obsessed with our consumers and constantly in touch with them to understand what they’re looking for from us. Across our treats and snacks portfolio we’ve strategically rolled out research-backed products that meet consumer demands,” he finishes.
Within the past year, the brand launched M&M’s Caramel Cold Brew, as mentioned above, plus Snickers Hi Protein, Twix Cookie Dough, and Dove Molten Lava Caramel flavors.
Looking forward
Chocolate and confectionery companies are now looking towards the 2023 holiday season. Norman Love says that his company is working on two new advent calendars for the holidays and also developing a Latin-flavored bonbon line.
Stansberry adds that Kinder will debut a “Chocolate Mini Friends” treat for the 2023 Holiday and 2024 Easter Seasons. “The individually wrapped treats feature the classic Kinder taste and festive seasonal graphics that are designed for sharing, treating, and decorating,” she comments.
Ferrero also announced that it’s bringing Kinder Chocolate to the market this August.
“Kinder Chocolate is actually the first Kinder product ever produced—it is a milk chocolate treat with a creamy, milky filling that is crafted for kids but loved and shared by everyone. We see Kinder Chocolate as the next big hit from Kinder here—between Kinder Joy, Kinder Bueno, and Kinder seasonal products, overall Kinder has become a real power brand, reaching $500 million in retail sales,” Stansberry notes.
She reveals that Ferrero is currently expanding its presence and capabilities: “We’ll be cutting the ribbon soon on a new chocolate manufacturing facility in Bloomington, Illinois, and our new Innovation Center and R&D Labs in Chicago. And, particularly exciting for my team, we have broken ground on a new $214 million, 169,000 square foot facility in Bloomington that will manufacture Kinder Bueno products—the first time ever that an original Ferrero brand will be made in the United States.”
CHOCOLATE TRENDS
We talked with William Angleys, sales director, Cabosse Naturals, a Barry Callebaut brand, about what products its chocolate customers have been wanting to use in their products, and some trends in the chocolate industry.
Liz Parker: What have your chocolate customers been asking for the past few months?
William Angleys: At Cabosse Naturals, we’ve seen a growing increase in demand for solutions for confectionery and ice cream which are both clean label and sustainable, made with simpler, fewer ingredients which are responsibly sourced.
As a global cacaofruit expert, we are working hand in hand with our customers, who are responding to this demand from consumers, offering products which are not only nutritious and tasty, but which also have a positive impact on the planet and its people.
That’s one of the reasons why Cabosse Naturals, a Barry Callebaut brand, has looked into upcycling the delicious cacaofruit, a largely undiscovered fruit, developing a range of 100% pure cacaofruit ingredients, including new cacaofruit powder, alongside juice, pulp, and concentrate.
Until now, around 70% of the cacaofruit has been discarded once its beans have been harvested for chocolate. That’s as much as 10 million tons a year.
Cabosse Naturals is helping brands create new products which contain upcycled cacaofruit ingredients, empowering consumers to make a positive impact with their everyday purchases, since they are eligible for the Upcycled Certified mark on pack, since we are part of the Upcycled Food Association.
Sustainability is something our parent company to which our parent company, Barry Callebaut, a manufacturer of high-quality chocolate and cocoa products, is committed. Barry Callebaut reports transparently on its social and environmental performance.
LP: What are some current and emerging customer trends?
WA: Our customers show an increasing interest in health and wellbeing, and a desire to help consumers fulfill their aims of living happy, healthy lives.
For many years, consumer research from Barry Callebaut showed two attitudes toward life: one of celebrating life and the other of living consciously. In the past, these two attitudes—one for indulgence and the other for a healthier lifestyle—were typically experienced at separate moments.
More recently, however, we see these distinct attitudes merging. By exploring this, we discovered that a growing need for living a symbiotic life is emerging. This results in three types of indulgence that coexist.
Depending on their mood or mindset, consumers have a specific attitude towards life and that attitude will determine the type of indulgences they choose.
While there will always be a need for intense and healthy indulgence, we expect consumers to live more with a soft health approach to life, increasing the mindful indulgence space.
Since announcing the introduction of the second generation of chocolate last year, 150 years after the introduction of the first generation, Barry Callebaut expects its customers will use this opportunity to respond to this trend for a healthier lifestyle by developing new products.
This new chocolate contains 50% less sugar than 85% of the chocolate consumed across the world, and enables brands and artisans to be fit for what consumers desire: food and drinks paying homage to nature’s flavors, while supporting them to live more healthily.
NEW CHOCOLATE PRODUCTS on snackandbakery.com/candy-industry
Snickers Butterscotch Scoop flavor
Delysia Chocolatier All-American Summer Collection
Norman Love Confections Donuts & Coffee Gift Box
Discover More New Products at snackandbakery.com/candy-products
