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Last year, consumer research firm Mintel predicted innovative and premium products would begin to occupy a larger share of the U.S. candy market. So far, that prediction appears to be coming to fruition at  convenience stores. 

“Year to date, chocolate is up over 7% for us, and I expect that trend to continue into summer,” said Daniel Moran, category manager for the Rotten Robbie chain with 34 stores in Northern California. “I utilize a proven strategy of ‘two for $X’ promos with overlapping displays.”

Rotten Robbie’s numbers are in line with a Zion Market Research report that estimates the global chocolate market is  growing at a compound annual growth rate (CAGR) of 7% between 2018 and 2024. Smart marketing and the ability to adapt to market changes help, too.

Plaid Pantry’s Director of Marketing Tim Jones said that, for his 108 stores serving the Pacific Northwest, mainstream chocolate candy is trending down, but the chain adjusted by switching gears to higher-end products.

“We have expanded our variety of premium, imported and specialty chocolate offerings,” said Jones. “There is growth in this sub-segment, but not enough to move overall category performance.”

Flavor Innovation

That shift fits recent chocolate consumption trends by millennials, who’ve displayed an above-average preference for fine chocolate made by small, artisan chocolatiers, according to a May 2019 National Confectioners Association report, “Getting to Know Chocolate Consumers.” The report also noted premium chocolate — priced at $11 per pound and up — grew more than 19% in 2018. 

Mintel’s “Chocolate Confectionery US 2018” report found more than three-fourths of chocolate buyers said they would pay more for premium chocolate. Mintel reported customers crave more unique and savory flavors, as well as health benefits like added protein.

Some of the flavor innovations have been successful for Plaid Pantry. Jones pointed to Snickers share size — with peanut butter or almond butter — as one of the chain’s better-selling chocolate items. 

“Kinder Surprise Eggs are a more recent best-seller for us,” he added. 

Rotten Robbie’s Moran is stocking outside the flavor box, too, and showing success with it.

“I brought in quite a bit of innovation this year, but the Twix Triple Chocolate has outperformed all of them,” said Moran. “I thought it was a great flavor, so I scheduled a lot of displays, and I’m happy to see such strong numbers as a result.”

C-store retailers can expect much more to come in the area of flavor innovations. Look for floral and botanical flavors to emerge this year in sweets and other categories, according to the “Global Floral Flavors Market 2018” report from Research & Markets. Ingredients and extracts from natural flowers are expected to see a CAGR of 9.95% between 2018 and 2022. Preference for florals, like dark chocolate, is also driven by perceived health benefits. Consumers are also looking for a combination of authentic and adventurous tastes. 

Kerry Foods, an industry additive maker that specializes in flavor trends, listed florals chamomile, rose, saffron and lavender among its “2019 Taste Charts” list of fastest-growing flavors over the past three years, all of which are likely candidates for blending with chocolate. 

The fastest-growing flavors in the past year appear on Kerry’s “Emerging Flavors” list and include ube — a Philippine purple yam — alongside horchata, chai, wasabi, buttermilk and basil. Look for more sweet and savory combinations, too. Rosemary, bacon, cheese and chamoy also made Kerry’s list of savory emerging flavors.

Merchandising Strategies 

In terms of packaging, Jones said Plaid Pantry sees greater use of stand-up bags. The stand-up bags create a clearer, more uniform product display and make it easier for customers to find the products they are seeking. 

With an influx of new innovation to the chocolate category and limited space on c-store shelves, many c-stores are finding help from their supplier partners when optimizing store sets for success, including best practices in product placement based on shopper behavior research. 

“I work with the Hershey Customer Insights team to optimize our schematics,” said Rotten Robbie’s Moran. “They do a great job, and I appreciate their … recommendations. We’ve used their ‘strike zone’ merchandising strategies for two years in a row, and I believe it’s helped sales.” 

Source: Breaking the Chocolate Mold – Convenience Store Decisions