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While special-occasion and seasonal candy products can provide a boost, retailers can also improve their candy category performance by devoting attention to everyday confectionery sales, according to a recent webcast presented by the National Confectioners Association (NCA) entitled, “E5: Maximizing Everyday Confections.”
Everyday candy comprises 78 percent of sales, making it critical to the success of the overall category. Candy also improves key store metrics such as:
- Foot traffic — High penetration plus strong frequency and purchase cycles.
- Sales — High buying rate combined with strong outlook for new dollars.
- Retention — More customers buy everyday confections than seasonal candy.
- Profits — Everyday candy is also more profitable than seasonal, especially at the front end.
To assist retailers, the NCA narrowed down the ideal approach to category strategy to the “E5” principles for winning every day. They are:
C-stores can inspire shoppers and win future trips by making the candy section a fun and memorable experience. “Sensory stimuli can influence environment,” noted Larry Wilson, vice president of customer relations at NCA. In particular, retailers should play up sight, touch and taste by using vivid colors, attractive displays, in-store sampling and nostalgia.
“[Emotions] drive passion, loyalty and advocacy,” Wilson noted. Stores have an opportunity to capitalize on the strong emotional connection around candy, a quality not all categories have. By leveraging emotion to drive loyalty, retailers can reap the benefits of emotionally engaged customers who are three times more likely to recommend; three times more likely to repurchase; less likely to shop around; and much less price sensitive. As the role of emotions changes throughout the day, paying attention to dayparts is important. In the morning, confections can help consumers get started on their day; in the afternoon, it can improve focus between meals and tide consumers over until dinner; and in the evening, candy provides enjoyment and relaxation.
Quite simply, stores can be effective by giving shoppers what they want. Brands are very important in the candy category, as they dominate the purchasing decision tree. More than half of the time, the decision to buy candy is impulsive and consumers are most likely to reach for their existing favorite brands. However, it’s important not to overlook new products, as 30 percent of shoppers report that they always look for new items to try. Retailers should maintain awareness of new trends that can keep the category fresh. Price is the primary factor that drives new item trial in confectionery, followed by sampling, coupons, recommendations and brand.
Getting confections right requires operational excellence, webcast presenters said. The front end is the critical location for candy, but retailers can “think outside the aisle” and create effective points of cross-merchandising due to the impulsive nature of the category. Candy can be paired with flowers, cards, over-the-counter medicine, ice cream and more to create surprisingly effective combinations. Stores should also strive to avoid products going out of stock, as 43 percent of customers say they do without when their intended confection is not in stock.
By understanding the fundamental aspects of the confectionery environment, retailers will be better able to determine how to handle the category. Although it is a relatively recession-proof segment, value-based shopping has risen to some degree.
Health and wellness is also a concern, yet the majority of consumers believe candy can be enjoyed in moderation. Retailers should focus their messaging on how customers can achieve moderation. For example, stores can offer 100-calorie packs, fun-size candy or individually wrapped items. Retailers should also keep in mind that America is increasingly becoming a snacking culture rather than sticking to three meals per day.