Confectionery - UK - June 2009

Table of Contents

• Issues in the Market
• Key themes
• Definition
• Abbreviations
• Market in Brief
• Sugar confectionery, mints and gum is a sizeable market
• Health and innovation both feature as major challenges
• Manufacturers respond with NPD
• Multinationals increasingly dominate sales
• Advertising is playing a reduced part in promotion
• Distinct groups of confectionery consumers exist within the market
• Internal Market Environment
• Key points
• Consumers are becoming more health-conscious
  • Figure 1: Trends in healthy lifestyles and eating/snacking habits, 2004-08
• Teenagers also record a growing interest in healthy eating
  • Figure 2: Trends in eating/snacking views of children, 2004-08
• Innovation comes to the rescue
• Restrictions on advertising to children are now in place...
• ... but are more set to follow?
• Schools reject HFSS foods
• Seasonality plays a part in the market
• Broader Market Environment
• Key points
• Sluggish growth in the children and teenagers market presents possible problems
  • Figure 3: Structure of the UK population, by age and gender, 2004-14
• Increasing affluence allows possibility of trading up
  • Figure 4: Forecast adult population trends, by socio-economic group, 2004-14
• Strengths and Weaknesses
• Strengths
• Weaknesses
• Competitive Context
• Key points
• Changing eating habits pose a growing threat for sugar confectionery
  • Figure 5: Trends in consumption of confectionery and snacks, 2004-08
  • Figure 6: Consumption of confectionery and snacks among children aged 7-14, 2008
• Chocolate sales benefit from growing health awareness
• Cereal bars seeing spectacular growth
  • Figure 7: UK retail value sales of selected snack foods, 2006-09
• Crisps continue as the dominant snack product
• Sugar confectionery market can learn from its rivals
• Children remain wedded to sweets and chocolate
• ... while faced with competing demands for their pocket money
  • Figure 8: Trends in pocket money spend by 7-10-year-olds, 2004-08
• Are older children being hit by the credit crunch?
  • Figure 9: Trends in pocket money spend by 11-14-year-olds, 2004-08
• Market Size and Forecast
• Key points
• Innovation helps drive sales forward
  • Figure 15: UK retail value sales of sugar confectionery, mints and gum, 2004-14
• Sugar confectionery performs the strongest to 2009
  • Figure 16: UK retail value sales of sugar confectionery, mints and gum, by sector, 2004-14
• Forecast
• Factors used in the forecast
• Segment Performance
• Key points
• Sugar confectionery
  • Figure 17: UK retail value sales of sugar confectionery, 2004-14
• Sugar confectionery goes soft
  • Figure 18: UK retail value sales of sugar confectionery, by type, 2007-09
• Retro product proving a success
• Improving health credentials unites the market
• Gum
• Chewing gum benefits from innovation
  • Figure 19: UK retail value sales of gum, 2004-14
• Sugar-free continues to grow in popularity
  • Figure 20: UK retail value sales of gum, by type, 2007-09
• Chewing gum manufacturers increasingly home in on new experiences
• Bubble gum market goes pop
• Mints
• Mints suffering from declining consumer base
  • Figure 21: UK retail value sales of mints, 2004-14
• Strength dominates consumer thinking in the mint market
  • Figure 22: UK retail value sales of mints, by type, 2007-09
• Market Share
• Key points
• Chewing gum helps Cadbury take market leadership in 2008
  • Figure 23: Manufacturers' shares in UK retail value sales of sugar confectionery, mints and gum, 2006-08
• Cadbury and Nestlé battle it out...
• ... while Mars pursues a strategy of acquisition
• Other suppliers suffer mixed fortunes
• Sugar confectionery
  • Figure 24: Manufacturers' shares in UK retail value sales of sugar confectionery, 2006-08
• Nestlé leads in sugar confectionery
• Cadbury Trebor Bassett performing well
• Masterfoods and Haribo pursue different strategies
• Smaller manufacturers can still be successful
• Gum and mints
• Arrival of Trident puts the dominant position of Wrigley under threat
  • Figure 25: Manufacturers' shares in UK retail value sales of gum and mints, 2006-08
• Cadbury' s move into chewing gum reinforces position as clear number two...
• ... although Wrigley continues to dominate sector overall
• Others rely on the success of strong brands and flavours
• Own-label fails to make progress
• Channels to Market
• Key points
• Desire for convenience increasingly influences purchase behaviour
  • Figure 26: UK retail value sales of sugar confectionery, mints and gum, by outlet type, 2004-08
• Grocery multiples
• Impulse outlets
• Renewed confidence for in-store displays
• Companies and Products
• Key points
• Manufacturers and brands
  • Figure 27: Leading companies in the confectionery market and their brands
• Cadbury Trebor Bassett
• Ferrero UK
• Fox' s Confectionery
• Haribo
• Jelly Belly Candy Company
• Leaf UK Confectionery
• Mars
• Mike and Ike
• Nestlé UK
• Panda Licorice
• Perfetti Van Melle
• Ricola
• Storck Group
• Swizzels Matlow
• Topps Confectionery
• Walkers' Nonsuch Toffee
• Brand Communication and Promotion
• Key points
• Adspend fluctuates as manufacturers respond to ad restrictions
  • Figure 28: Monitored media advertising spend on sugar and gum confectionery, 2004-08
• Wrigley dominates adspend
  • Figure 29: Monitored media advertising spend on sugar and gum confectionery, % by advertiser, 2004-08
  • Figure 30: Monitored media advertising spend on sugar and gum confectionery, % by sector, 2004-08
• Gum and mints are best-supported overall
  • Figure 31: Monitored media advertising spend on sugar and gum confectionery, by manufacturer and brand, 2005-08
• TV continues to dominate communication strategies
  • Figure 32: Main monitored media advertising spend on sugar and gum confectionery, % by media type, 2004-08
• The Consumer -- Usage Across the Generation Gap
• Key points
• Adult consumption
• Downward trend in consumption of sugar confectionery and gum
  • Figure 33: Trends in frequency and usage of sweets/chewing gum/mints, 2004-08
• Demographic analysis
• Consistent across confectionery
• Segment divisions
  • Figure 34: Most valuable consumers for volume sales of confectionery, by age group and by type, 2008
  • Figure 35: Most valuable consumers for volume sales of confectionery, by socio-economic group and by type, 2008
• Gums, jellies and chews prove the most popular with adults
  • Figure 36: Type of sweets eaten most often, 2008
• Low- and reduced-sugar sweets hold minor share of sales
  • Figure 37: Consumption of sweets by sugar content, 2008
• Sugar-free proves more popular with users of chewing gum
  • Figure 38: Trends in usage of chewing gum by type, 2004-08
• Young children (7-10-years-old)
• Sweets remain popular with children
  • Figure 39: Trends in frequency and usage of sweets among children aged 7-10, 2004-08
• The bubble has burst for children' s gum use
  • Figure 40: Trends in frequency and usage of chewing gum among children aged 7-10, 2004-08
  • Figure 41: Trends in frequency and usage of bubble gum among children aged 7-10, 2004-08
  • Figure 42: Most valuable 7-10-year-old consumers for confectionery, by socio-economic grade and by type, 2008
• Youths 11-14-years-old
• Teens turn away from sweet treats
• Figure 43: Trends in frequency and usage of sweets among children aged 11-14, 2004-08
• Teen years important for breaking social barriers
• Chewing gum -- more popular among older than younger children
  • Figure 44: Trends in frequency and usage of chewing gum among children aged 11-14, 2004-08
  • Figure 45: Trends in frequency and usage of bubble gum among children aged 11-14, 2004-08
  • Figure 46: Most valuable 11-14-year-old consumers for confectionery, by socio-economic group and by type, 2008
• Appendix -- Internal Market Environment
  • igure 52: Adults dieting/trying to get slim, by demographics, 2008
  • Figure 53: Trends in youths dieting/trying to get slim, 2004-08
• Appendix -- Competitive Context
  • Figure 54: Confectionery and snacks usage, by demographics, 2008
  • Figure 55: Confectionery and snacks usage, by demographics (continued), 2008
  • Figure 56: Confectionery and snacks usage amongst 7-10 year olds, by demographics, 2008
  • Figure 57: Confectionery and snacks usage amongst 7-10 year-olds, by demographics, 2008
  • Figure 58: Confectionery and snacks usage amongst 11-14-year-olds, by demographics, 2008
  • Figure 59: Confectionery and snacks usage amongst 11-14-year-olds, by demographics (continued), 2008
• Appendix -- The Consumer -- Usage Across the Generation Gap
  • Figure 60: Frequency and usage of sweets, by demographics, 2008
  • Figure 61: Frequency and usage of chewing gum, by demographics, 2008
  • Figure 62: Frequency and usage of mints, by demographics, 2008
  • Figure 63: Frequency and usage of sweets among 7-10-year-olds, by demographics, 2008
  • Figure 64: Frequency and usage of chewing gum among 7-10-year-olds, by demographics, 2008
  • Figure 65: Frequency and usage of bubble gum among 7-10-year-olds, by demographics, 2008
  • Figure 66: Frequency and usage of sweets among 11-14-year-olds, by demographics, 2008
  • Figure 67: Frequency and usage of chewing gum among 11-14-year-olds, by demographics, 2008
  • Figure 68: Frequency and usage of bubble gum among 11-14-year-olds, by demographics, 2008