Blog: Dean BestHow the downturn has soured UK confectionery sales

Dean Best | 5 November 2012

Even confectionery, long seen as one of the food sectors more resilient to economic pressure, has seen sales take a hit in recent months, according to data coming out of SymphonyIRI.

That bar of chocolate or bag of sweets, touted as an affordable treat for cash-strapped consumers, is not being reached for as often, the analyst firm said today.

For the 36 week period up to 1 September, volume sales of confectionery in the UK dropped 1.3% compared to the same period in the previous year, SymphonyIRI said. The fall was the second-highest decrease across food categories, it said.

In value terms, sales were up 1.3%, driven by price increases. That said, SymphonyIRI noted, the price of confectionery is rising at the slowest rate when compared to other categories. The percentage of confectionery sales on promotion is up - from 64% a year ago to 66%.

Tim Eales, director of strategic insights at SymphonyIRI, said: "As price inflation continues and incomes are squeezed, shoppers are forced to cut back on non-essential items. In the past we have always seen them save a little for a treat but now even the treats are being rationed. This may be combined with a desire by consumers for a healthier lifestyle."

Just a quick glance in local stores, show the range of promotions confectioners are using to entice shoppers. SymphonyIRI notes an increase in the use by confectioners of off-shelf promos.

"There is evidence that off-shelf often achieves better uplifts and is more efficient for retailers, who are choosing to place more products on them to maximise their effect," it said.

One example is that used in my local Co-op by Mars, which itself is plugging a promotion across its chocolate portfolio that gives shoppers the chance to win a free bar if they buy a Mars, Twix etc. It comes across as a promotion used by a company very keen to drive volumes.

So what is the reason for the dip in confectionery sales? Is it price? Is it health? Is it a relative lack of innovation (Cadbury execpted) coming out of the category?


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