Chocolate Outlook Seems Sweet

from CStore Decisions July 2021

by WTWH Media LLC

Controlling Your Brand Identity

Chocolate sales are on the upswing at convenience stores headed into summer, and retailers are optimistic for the months ahead as pandemic restrictions lift.

Erin Del Conte • Executive Editor

As we emerge from the COVID-19 pandemic, customers are looking to treat themselves with something sweet, and the chocolate category at convenience stores is reaping the rewards.

Chocolate sales at c-stores increased 8.5% to $2.76 billion for the 52 weeks ending May 1, 2021, vs. one year ago, according to NielsenIQ Retail Measurement Services, Total U.S. Convenience data. That’s up 4.15% from the end of 2020, when chocolate sales totaled $2.65 billion for the 52 weeks ending Dec. 26, 2020, per Nielsen Total U.S. Convenience data.

An uptick in traffi c seems to be driving the trend. The c-store channel saw a 4.4% increase in chocolate buys during the 52-week period ending May 1, 2021, and the average amount of units purchased per trip grew 2.6%, while the average spend per buyer dipped by 1.3%, according to NielsenIQ Homescan Panel, Total U.S. Convenience + Gas.

Innovation is continuing in the category. According to the National Confectioners Association, trends to watch include smaller pack sizes with 200 calories or less, tropical fl avors with a focus on pineapple and coconut, and mix-and-match combinations — think sweet and salty or fruity and tart.

CHOCOLATE SALES CLIMB

At Cenex Zip Trip stores, Q1 of 2021 brought a 15% lift in sales on chocolate candy count on standard and king-sized items, noted Jon Fleck, merchandising manager for Cenex Zip Trip, which operates 39 convenience stores in seven states. That’s a big difference than what the chain was seeing in the category mid-pandemic when traffi c dipped and chocolate candy sales declined.

“Only part of last year’s fi rst fi ve-month numbers were COVID-19 impaired, so this dollar increase in chocolate is good news in a candy category that saw hanging bags and kids’ novelty lead the growth in candy sales for us last year,” Fleck said. “Growth-wise, however, we still see non-chocolate candy outpacing our chocolate lineups this spring.”

Cenex Zip Trip stores have seen the recent launch of Snickers Peanut Butter Brownie selling well. “It has become our No. 11 selling chocolate candy SKU overall,” Fleck noted.

Fleck expects the chocolate candy segment to continue to grow as more states reopen postpandemic and more customers begin to travel again. “Trips mean treats, and the chocolate category will defi nitely see growth,” he said.

The chocolate segment is also trending positively at Worcester, Mass.-based Nouria Energy, which owns 163 locations, 146 of which are company-operated.

“We have seen a large shift back into immediate consumption for chocolate with sales above pre-COVID (levels),” said Nik DiMambro, category manager for Nouria Energy. During the height of COVID-19, Nouria Energy saw a decline in the sale of immediate consumption items, as customers opted for take-home options.

Today, recent launches of Kinder Bueno and Reese’s Big Cup With Pretzels are resonating with customers.

“Both performed extremely well from the moment we introduced them into the set,” DiMambro said. Nouria Energy is also debuting its own private-label line of candy bars through a partnership with Hebert Candies, that is expected to bring quality and value to guests.

Looking ahead, DiMambro is bullish about the chocolate candy segment for the remainder of 2021. “With the amount of innovation and quality we will be supplying our guests with,” he said, “I cannot see a scenario where the category does not continue to grow for us.” CSD