John H. Downs, Jr, president & CEO of the NCA, told ConfectioneryNews: “The retail environment is changing given the fact that the consumer landscape is changing. Consumers are in control - there’s no doubt about that.”
Rolling dialogue
He said consumers now got information from a plethora of sources due to breakthroughs in technology that had created conversations everywhere.
There are over 500m tweets per day, 157 m active users on Facebook in the US & Canada alone and microblogging sites such as Tumblr are offering alternative perspective to mainstream news, changing consumer perceptions and empowering them to influence the retail landscape.
Multi-channel approach
Thomas Joyce, vice president of global customer & industry affairs at Hershey said: “It’s an omni-channel approach and they [the retailers] weren’t there five-years ago.”
Retailers today have aisles or entire stores dedicated to natural and organic products that were previously not present. Many specialty retailers such as Whole Foods are strongly engaged on social media and have sway among tech-savvy consumers.
Online confections sales are also in growth. According to an NCA survey, 30% of US shoppers say they buy candy online, up from 24% in 2014. The majority say they purchase online to buy specialty candy that is only available on the internet.
Natural & organic
We asked Downs which products he expected to see more of at the NCA’s Sweets and Snacks Expo in May.
“Gourmet, natural and organic products – I think you’ll see more in that category as it relates to what’s happening in the business.”
Although natural claims have been on the decline in the US, 22% of all new food products launched in the country from Jan. 1, 2013 to July 31, 2014 made a “natural” claim, according to Datamonitor’s Consumer’s Product Launch Analytics database.
In its latest T for Trends webinar, Cargill said Millennials – the generation of people aged 15-35 accounted for a third of the global population and were having a big impact on what's happening in food. It said that this group spent a lot of time online and were very socially engaged making it important for confectioners to have clear and transparent ingredients labels and to use ethically-sourced ingredients such as certified cocoa.
Adapting to empowered consumers
“It’s really a dynamic retail landscape that we all face, but we believe the confectionery category is really unique, special and different – it’s something people enjoy, “ said Downs.
Hershey’s Joyce continued: “Like John said the consumer is in charge and the retailers have to adapt and change. People are telling us it’s not going to be a slow process.”
Confectioners themselves are already adapting. For example, online conversations on perceived dangers of GMOs and artificial colors and flavors have led to reformulation by major US confectioners.
Hershey plans to remove GMOs from Hershey’s milk chocolate and Kisses by the end of the year and Nestlé USA has also committed to replacing artificial colors and flavors with naturally-derived versions by year-end.