Sweets Report

TREAT YOURSELF

AMID PANDEMIC STRESS, CONSUMERS TURNED TO SWEET SNACKS FOR A MOMENT OF JOY

By Zachary Russell

The COVID-19 pandemic has kept most people indoors for nearly two years, which led to a rise in grocery deliveries, healthier foods and a renewed interest in home-cooked meals. Another category that has seen increased sales across the board during the pandemic is sweets.

“More consumers are ordering from online platforms or are stocking up on their sweet treats in bulk when they make their limited trip to the grocery store,” said Connor Kramer, national account manager at Krüger North America, an ingredient supplier that makes chocolate and sweets for private label companies.

“These ordering patterns are increasing sales at the retail level and are replacing the consumer’s sweet treat fix that they would normally get at a restaurant or on the go. Physical and mental well-being plays a factor, too. This pandemic has certainly caused a lot of stress and tragedy for many families. I think people turn to sweet treats like chocolate to get that instant feeling of comfort and joy. During these times, people are more accepting of ‘treating yourself’ to food that makes you feel happy even if it is for a short period of time.”

Of the products in the category: ice cream has seen some of the most success. According to the International Dairy Food Association, ice cream makers in the U.S. produced more than 1 billion gallons of hard ice cream in 2021, up 6% from 2019. In the first five months of 2021, hard ice cream production was up 4% compared with the previous year. More specifically, the IDFA said that between March and May of 2021, sales of frozen novelties were up 24% from the same period in 2019.

Innodelice, a supplier network for the frozen dessert industry, determined four growing trends in the category: snack-ification (bite sized, controlled portions), healthy-er (additional benefits, plant-based), natural-ity (clean label or organic) and indulgent & surprising (multi-textured, colorful, or exotic).

“Traditionally, private labels look to brands to identify

best performing SKUs and launch a ‘knock-off’ version of the same product,” said Andrea Montreuil, co-founder of Innodelice, Canada. “Hence, double-coated bars, round premium sandwiches, multi-texture pints and, of course, plant-based frozen desserts are certainly products to consider. However, with the rise of private label consumer loyalty and the innovation potential that exists within our global ice cream ecosystem, we believe that private label retailers can become trend setters vs trend followers. Immunity ice cream could be a good example.”

INNOVATIVE FLAVORS

With increased sales comes an increased demand for new and innovative flavors. Unique and creative flavors have dominated the ice cream category, with private label brands doing a lot of the innovation.

“Two of the top trends impacting sweet treats like candy and ice cream are the infusion of dynamic flavors and better-for-you qualities, creating new experiences for consumers,” said James Hedges, senior manager of category solutions at Daymon. “Unique flavors, layered textures, and color support the growing trend of sensory fusion appealing to consumers — especially younger consumers such as Gen Z and Millennials.”

Publix and Albertsons are two chains that recently brought back holiday ice cream flavors for the fall and winter seasons. Publix Premium’s unique seasonal flavors include Praline Pecan Bread Pudding, Caramel Mountain Tracks, Marshmallow, Candy Cane & Cookie Blast, and Mocha Mud Pie just to name a few. At Albertsons stores, pumpkin pie, eggnog and peppermint flavors are available for the holidays. Outside of the holiday varieties, Southeastern Grocers has won dozens of awards for its dairy products, including ice cream and frozen yogurt.

Upstart ice cream company Frutero recently launched an exclusive flavor with delivery service Gopuff, a testament to the flavor innovation in the category. The new Tangerine n’ Cream flavor join Frutero’s lineup of other tropical ice cream flavors such as mango, passionfruit, guava and more, but is only available through Gopuff.

“Premium artisan varieties are taking hold within ice cream, with the integration of global flavors such as horchata, churro, and mochi,” added Hedges. “We are also seeing diverse varieties pop up, with green tea and various chili pepper flavors to deliver new flavor experiences within candy, or ingredients such as cookies or cereal in ice cream to deliver a sense of nostalgia. Textures and layers are creating enhanced experiences, and limited-edition items are providing for new, sometimes seasonal opportunities, particularly for private brands.”

In addition to new and unique flavors, healthy and plant-based sweet options have risen out of the pandemic, including products with less sugar, added protein, probiotics and more.

“With 77% of consumers looking to lead a healthier life than pre-pandemic, consumers increased their efforts to proactively manage their health and diet,” said Hedges. “Additionally, with changes in routine and the added stress caused by the pandemic, mental wellbeing also became a focus, with consumers looking for products and food to provide comfort.”

The chocolate category has also seen a major increase in sales from 2019 to 2020. According to a recent article issued by the National Confectioners Association, in the year 2020, chocolate sales increased by 10.5% from the previous year, totaling 21.9 billion in the United States alone.

In the candy category as a whole, total sales of non-seasonal candy were estimated to reach $6.5 billion in 2021, up 19% from 2020 and 23.8% from 2019, according to Numerator. The July-to-October period saw non-seasonal candy sales grow 19% year over year and 24% compared to two years ago.

This increase in chocolate sales could provide a boost to private brand sweets as retailers look to compete with name brand chocolate items.

“Retailers should be looking into more private label offerings that are matches to the big branded chocolate items,” said Krüger’s Kramer. “With the pandemic, due to a number of factors like product availability and increased costs, we have seen consumer willingness to try private label chocolate items that they normally would ignore. I think this willingness to buy the less expensive chocolate alternatives and the diminishment of brand loyalty will continue to gain steam and is something all retailers should be mindful of.”

Meijer’s Small, Hyper-Local Market

In the fall, Meijer opened its fourth Rivertown Market format store in

Detroit, offering a cozy neighborhood feel in a 42,000-square-foot store that has a vast assortment of exclusive fresh and prepared foods, Meijer own brand favorites, and a special partnership with the local Great Lakes Coffee. Store Brands visited the location to get a taste of Detroit’s finest in the hyper-local and fresh store.