Transcript
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Confectionery:The Global Market Perspective
Euromonitor InternationalBrian Morgan, Senior Research Analyst
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Outline
Key Market Figures
A brief introduction to market sizes and shares during the 1998-2007 period.
Global Market Trends
Trends highlights grouped by theme: Health, Organic, Premiumisation, Segmentation andInnovation.
Market Opportunities
A glimpse into hot opportunities identified by Euromonitor in the Confectionery market.
Market ProspectsA brief introduction to market performance forecasted by Euromonitor during the 2007-2012 period.
Forecasts and a Word of Advice
Euromonitor advises on strategies to be undertaken in order to maximise growth potential.
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Global Value - Confectionery
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
ValueUS
$million
Global retail sales of confectionery totalled US$20 billion in 2007.
Up 4% on 2006
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Confectionery retail volume sales Growth by region
0.00
1.00
2.00
3.00
4.00
5.00
6.00
Western
Europe
Eastern
Europe
North
America
Latin
America
Asia Pacific Australasia Africa and
Middle East
1998-07 CAGR % 2006/07 (%) Growth
Economic growth drives growth of premium categories of Chocolate and Gum in AsiaPacific/Eastern Europe
Premium Chocolate - driving force in growth in North America
Maturing consumer demand/private label expansion constrain value growth in Western Europe.
Eastern Europe, Asia Pacific and Africa and Middle East lead sales growth
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Global Chocolate confectionery retail sales Growth byregion
Eastern Europe, Latin America and Asia Pacific show strongest growth
-2.00
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
WesternEurope
EasternEurope
NorthAmerica
LatinAmerica
Asia Pacific Australasia Africa andMiddle East
PercentageGrowthRate
1998-07 CAGR % 2006/07 (%) Growth
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Global sugar confectionery retail value sales Growth bycategory
Toffees, caramels and nougat, Pastilles, gums, jellies and chews and Lollipops
growing strongly
-3.00
-2.00
-1.00
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
Mints Boiled sweets Pastilles,
gums, jellies
and chews
Toffees,
caramels and
nougat
Medicated
confectionery
Lollipops Liquorice Other sugar
confectionery
PercentageG
rowthRate
1998-07 CAGR % 2006/07 (%) Growth
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Global Gum retail value sales Growth by category
Sugar-free and Functional Gum lead growth
-4.00
-2.00
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
16.00
Sugarised gum Sugar-free gum Functional gum Bubble gum
Percentage
GrowthRate
1998-07 CAGR % 2006/07 (%) Growth
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HealthOrganic
Premiumisation
Innovation
Segmentation
CONFECTIONERYMARKET TRENDS
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Global Market Trends: Health
Anti-oxidant properties
New research on chocolates antioxidant and heart-healthy properties has had
a positive impact on consumer perception
Manufacturers tap into the health trend by introducing semi-OTC flavonol-enriched lines
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Global Market Trends: Health
Withdrawal symptoms relief
Chupa Chups Relax SpainLaunched early 2006 in the wake of Spains publicsmoking ban
Features herbal ingredients intended to calm consumers suffering from smokerwithdrawal symptoms
Packaging reminiscent of cigarette packet
http://www.solostocks.com/ampliarFoto.cfm?foto=http://imagenes.solostocks.com/zoom/7/8/2/zoom_1315287.jpg&desc=chupa%20chups%20mini%20relax8/3/2019 Igh Global
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Global Market Trends: Health
Energy boost
Sport Beans by Jelly Belly Candy Co US Launched early 2007.
Formulated with carbohydrates, electrolytes and vitamins C and E.
Marketed towards athletes, weekend warriors and sports enthusiasts of all types.
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Global Market Trends: Premiumisation
Premiumisation trend in Western Europe and North America increasesdifferentiation from private label
Mainstream manufacturers focusing on the introduction of premium high-cocoa (>70%) dark chocolate lines, offering richer flavours and higherflavonol content
Sourcing chocolate by cocoa bean origin - targeting the connoisseurconsumer
Retailers such as Tesco in UK, El Corte Ingles in Spain and Carrefour inFrance are set to expand shelf space and offerings for high cocoa darkchocolate.
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Global Market Trends: Organic
Branded Organic Chocolate is positioned as a premium product.
Global retail sales for Organic Chocolate Confectionery reached US$401million in 2006, up 17% up on 2005.
Strong demand for organic chocolate Mergers & Acquisitions
Cadbury Schweppes acquired Green & Blacks in May 2005.
Hershey took over leading US organic manufacturer Dagoba OrganicChocolate Co in November 2006.
Sugar confectionery: Organic lines remain relatively unexplored; but are ofincreasing interest within the industry
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Global Market Trends: Segmentation
Halal Sugar confectionery is gaining popularity in countries with growingMuslim communities, particularly the UK, Spain and Germany.
In early 2007, Mederer Ssswarenvertriebs GmbHs extended its Halal jelly
range through the addition of two new fruit flavours: Valensina Orange Pur andCitrus Pur.
Ummah Foods (March 2007) introduces caramel and orange Halal countlinesthrough the Wm Morrison Supermarket network in UK.
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Innovation
Developed markets:
Developing markets:
Semi-OTC properties
Experimenting with sensations
Natural Ingredients and hybrid products
Convenience through packaging
Oral health
New flavors and fillings
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Semi-OTC Properties
Global Market Trends: Innovation in Developed Markets
Slimming properties Energy boost
Combination of liquid and solidflavours Odour sensations
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Global Market Trends: Innovation in Developed Markets
Natural ingredientsHybrid products
Convenience through
Larger formats Slimmer formats
Introduction of
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Global Market Trends: Innovation in Developing Markets
Unique Flavours, Fillings and Oral health
Fruit Juice fillings
Yoghurt flavours
Oral care and breath refreshingproperties
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Key Learnings From Success
ORBIT WRIGLEYJR, WILLIAMRUSSIAN MARKET
Wrigleys global sales have benefited from a proactive approach to
emerging markets, not only tapping into the current growth of the gumcategory but also actively driving up demand.
The Russian market is a valid example of this. Retail sugar-free gumsales in this country grew by 15% in local value during 2006. Thegrowth was stimulated by increasing health-consciousness amongRussian consumers and the increasing purchase-power of middle classRussians in urban areas.
Wrigley took full advantage of this trend, and invested heavily during 2006in expanding its distribution network while advertising the health benefitsof sugar-free gum. Furthermore, it expanded its sugar-free gum range byintroducing juicy watermelon, cinnamon and strawberry flavours. As aresult, Wrigleys sugar-free gum sales grew by 17% in local value in 2006.
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The Future of Confectionery
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Confectionery - Retail volume growth at world level
Confectionery forecast to grow at an average rate of 2.3% in retail volume
12500
13000
13500
14000
14500
15000
15500
16000
2007 2008 2009 2010 2011 2012
RetailVolume'000tons
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Global forecast retail volume by sector
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
Chocolate confectionery Sugar confectionery Gum
RetailVolu
me'000tons
2007 2010 2012
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Chocolate confectionery retail volume sales Growth by category
Tablets, Bagged Selflines/softlines and Boxed assortments expected to seestrong market performance from 2007 to 2012
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
Tablet
s
Countline
s
Bagge
dselflin
es/so
ftlines
Bo
xeda
ssortm
ents
Se
asonalchocolate
Ch
ocolate
with
toys
Alfajor
es
Othe
rchocolate
confe
ctionery
PercentageGrowthR
ate
2007-12 CAGR % 2006/07 (%) Growth
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Sugar confectionery - Retail volume growth by category
Pastilles, gums, jellies and chews, Mints and Toffees, caramels and nougat
expected to see strong market performance from 2007 to 2012
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
Mints
Boiled
sweets
Pastille
s,gums
,jellie
sand
chew
s
Toffees
,caramel
sand
nougat
Medic
atedc
onfectio
nery
Lollip
ops
Liquorice
Othe
rsugarc
onfectio
nery
PercentageGrowthRate
s
2007-12 CAGR % 2006/07 (%) Growth
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Gum retail forecast volume growth by category
Sugar-free gum and Functional gum expected to see the strongest marketperformance from 2007 to 2012
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
9.00
Sugarised gum Sugar-free gum Functional gum Bubble gum
PercentageGrowthRate
2007-12 CAGR % 2006/07 (%) Growth
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Market Opportunities
semi-OTCproperties in
chocolateconfectionery
Emergingmarkets for
sugarconfectionery
Expansion intofast growingimpulse foodcategories
Convenience &environmentalawareness: GumPackaging
Distribution
Differentiation
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Market Opportunities
Semi-OTC properties
Development of semi-OTC products remains relatively unexplored in chocolate tablets andboxed assortments.
Addition of chocolate in Ice cream, Snack bars and Breakfast cereals
This trend offers the opportunity for global chocolate manufacturers to expand into fast growingimpulse food categories, while tapping into their brands well-established reputations.
Economic Growth in Developing Markets
Sustained economic growth in developing markets provides international manufacturers with agolden opportunity to step up investment on premium, sugar-free, functional novelties
Environment concerns
Increasing concerns over environmental issues and CO2 emissions will play an increasing rolein consumer purchasing decisions, particularly in developed markets
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Distribution
The introduction of vending machines in fast food restaurants and near independent food
stores Investment in expanding the number of these outlets might prove successful in other
developing countries such as Morocco and Egypt.
Market Opportunities
Differentiation by
Gender: Chocolate Confectionery
Ethnic groups: Gum lines
Packaging:
Larger formats adaptable to spaces
Convenience for low energy consumption
Getting across the message: Chupa Chups
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A Word of AdviceDeveloped Markets
Sluggish growth in Bubble Gum - Innovation is key
Gum and Snack bars - Potential for synergies
Continued desire among consumers for healthierproducts
Potential for growth in emerging categories
Positioningcapture consumers attention
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A Word of AdviceDeveloping Markets
Domestic and International players - An alliance for growth
Education - The way forward in Functional gum
should draw inspiration from other successful developments in impulse food
products
Developing hybrid sugar confectionery lines
Gum and Sugar confectionery combinations
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THANK YOU!
Brian Morgan
Brian.morgan@euromonitorintl.com
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