The high per capita gum consumption in the US would surprise no one who has seen an American movie or watched a baseball game but what is more striking is that this mature and developed market continues to show significant growth. Francisco Redruello of Euromonitor International reports on the product innovations which have sustained consumer interest.

Gum is a mature and developed category in the US, but such is the American consumer's affinity for the product that the market continues to show dynamic growth, on the back of packaging innovation and the development of new product ideas and flavours.

According to Euromonitor International's estimates, retail value sales of gum in the US grew by 10% in 2006 to US$3.9bn, with retail volumes rising by 6% to 229,000 tonnes. The US not surprisingly has one of the highest per capita spends on gum in the world at US$13.5 in 2006, compared with $11 in Western Europe and $10 in Australasia, themselves both relatively developed gum markets. In the US, gum producers have looked to added value product innovation to sustain consumer interest and preserve their margins.

Sugar-free products and functional gum have been the key drivers. Functional gum has recorded the strongest growth, tapping into increasing consumer concern about oral health issues and growing interest in products offering positive health benefits. Sugar-free gum has also been a dynamic growth area, with retail sales up in value by 13% in 2006.

Sugar-free gum manufacturers, such as Cadbury and Wrigley, have managed to maintain sales momentum by constantly investing in new products, such as Cadbury's 'flavour lasting' sugar-free line, launched in May 2006, and Wrigley's addition of new flavour combinations,  such as lemon-lime and Crystal Mints, in July 2006.

After many years of steady but modest progress in a market where the leading brands have been fixtures for decades, the past few years have seen a wave of technological and marketing innovations among gum brands, which has spurred sales.

Tooth-whitening dental gums launched in the early-2000s began this trend, and have been followed by the use of new sweeteners like xylitol, pellet gums using different flavour encapsulation technologies, liquid-filled bubble and fruit-flavoured gums, new sour flavour combinations, other energy fortification, vitamin or mineral components, and marketing tie-ins with mint, sugar confectionery and soft drinks brands.

Alongside these product innovations have come new forms of packaging, primarily linked to the increasing popularity of pellet gums which lend themselves well to different packaging options. Pellet gums often come in containers which open from the front or tins in the style of mint brands. Wrigley's Eclipse brand launched a Big E Pack in 2006, containing 60 pellets in a plastic upright container designed to fit into a cup. Since gum is often an impulse purchase, these new forms of packaging offer an added convenience that has distinguished many new brands in the minds of consumers.

Functional gums remain popular in the US, showing double-digit growth for the third successive year in 2006, despite being on the market for a number of years now. The majority of these gums contain sweeteners with tooth-whitening capabilities, but the sector has also expanded to include gums fortified with vitamins, or ingredients which antioxidant properties such as green tea and pomegranate. Energy gums, such as Jolt and Mad Croc, have also proved popular. The rising popularity of fortified and sugar-free gums shows a continued desire among consumers for healthier products, and manufacturers have increased their efforts in recent years to meet this demand.

In terms of competitive landscape, Wrigley continues to lead the market for gum in the US, with over half of value sales. Wrigley's Extra is the top-selling gum overall, its Orbit White is the fastest growing functional gum, and its combined brands account for over 70% of sugarised gum sales. Although its 2005 acquisition of the Kraft sugar confectionery brands was probably the most noteworthy move the company has made in some years, Wrigley also opened a Global Innovation Center that year, and continues to launch new products, including watermelon, coffee and cinnamon-flavoured gums in January 2006. Wrigley's wide brand recognition and distribution network are very difficult for its competitors to match.

Growth is expected to continue in all gum categories between 2006 and 2011, according to Euromonitor International's forecasts. This growth will be bolstered by a turnaround for sugarised gums after many years of decline, as new products and flavours continue to attract consumers. Overall rates of retail volume and value growth are, however, predicted to slow somewhat between 2006 and 2011 compared to the previous few years, as functional gums begin to mature, with no major brand launches expected following Stride in 2006.

Although Wrigley and Cadbury continue to launch products featuring many new flavours, packaging and technologies, neither company has expanded beyond their tooth-whitening gums in the functional gum category. This area, therefore, still offers a great deal of scope for new forms of functionality and indeed has seen a lot of activity from smaller companies offering energy gums, electrolyte-enhanced sports gums, gums with menthol targeting smokers, and even products with collagen or other skin-enhancing ingredients for beauty. While it still remains difficult for such products to gain widespread distribution, the continued interest in health and wellness among consumers creates the possibility for niche markets to emerge.

Click here to download the Euromonitor report Confectionery in the United States.