Treats (not health) will drive German gum market: Analyst

By Oliver Nieburg contact

- Last updated on GMT

'Gum needs to return to its roots,' says Canadean analyst
'Gum needs to return to its roots,' says Canadean analyst

Related tags: Confectionery, Compound annual growth rate

Gum is set to grow faster that all other confectionery categories in Germany and will be driven by premium products and claims that go beyond dental health, according to a market analyst at Canadean.

Ronan Stafford, report analyst at Canadean told ConfectioneryNews that German consumers were no longer wowed by the oral hygiene benefits of gum since most gums in the country were already sugar-free and dental benefits were taken as a given.

“While health is an important angle for gums, it’s no longer a key differentiator between products.”

“As an impulse product, gum needs to return to its roots: Consumers are likely to choose between gums that meet their need for a treat, or which offer additional fun and enjoyment than a ‘basic’ gum featuring standard health benefits.”

Gum the smallest but fastest growing category

Market research organization Canadean forecasts that Germany’s mature confectionery industry will remain relatively flat at +0.9% in value and +0.4% in volume over the next five years due to population declines and a growing trend towards health and wellness.

It expects the smallest segment, gum, will grow faster in value and volume than all other confectionery categories at a compound annual growth rate (CAGR) of 1.3% in value and 1.8% in volume.

‘Opportunities for premiumization’

Stafford said that confectionery was not recession proof, but it had withstood the economic downturn better than other industries.

“Germany’s relatively rapid (by European standards) recovery has created opportunities for premiumization, as best shown by the success of 5 Gum.”

“The gum market is far smaller than the chocolate and sugar confectionery markets, and as such small changes in consumer behavior are reflected all the more strongly.”

Consumers not ready to up chocolate and candy spend

He said that while health benefits had made gum consumption more habitual, chocolate and sugar confectioners were still struggling to convince frugal consumers to spend.

Chocolate, Germany’s largest confectionery segment is expected to grow just 0.9% in value by 2017, while sugar confectionery is projected to rise 0.6%.

Related topics: Markets

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