NCA SOTIC 2019: ‘Digital is the new front door’ for candy sales

By Anthony Myers

- Last updated on GMT

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The 135th gathering of the NCA State of the Industry Conference ended as it began on a high, more Queen songs blasting over the PA and a promise to return next year with an even better event. Here’s a brief roundup of some of the discussions that took place over the two days on future trends. Check out our video for a taste and flavor of SOTIC 2019.

NCA president & CEO John Downs highlighted the organization's chief goals for 2019 at the end of the conference when he presented its annual report. "We will endeavor to engage more individuals and more companies in our association, as together we imagine and build an even stronger confectionery industry​," he said. 

The annual report's chief goals for 2019 include:
• Building relationships with more than 100 new members of Congress to cultivate
champions for the industry by sharing our compelling narratives of economic impact,
responsible leadership and emotional well-being;
• Expanding the Always A Treat Initiative to showcase an entire industry of companies
dedicated to providing more information and options in the marketplace, and to promote
category permissibility and the power of our informed choice merchandising strategy;
• Ensuring that candy’s unique and special role—and the efforts of the industry to help
consumers manage their sugar intake—are understood and appreciated by a variety of
stakeholders; and
• Engaging NCA members—including a strong group of young professionals from our Future
Leadership program—in the development of a refresh of our strategic plan for 2020–2023.

Candy is consumed with the heart, we were told, but those attending the conference were delivered a stark message: the love is not unconditional.

Doug Stratton, chief digital commerce officer, Hershey Company said:

  • Convenience is king. No surprises that mobile with 95% usage is driving convenience and digital is the new front door for retailers. A survey on shopping habits showed that shoppers value convenience (59%) and 53% of them said digital is the source of convenience.
  • Digital is the new front door for retailers, just different levels, different formats.
  • Confectionery has been behind the curve in digital transformation and companies must grapple with the technology, to improve efficiency in logistics and how it engages with consumers.
  • Get the digital shelf life right, impulse purchases are under threat at the checkout, because there is no checkout. Digital impulse points operate completely differently to the physical world, but they do exist and the way for companies to exploit them is through the extraordinary use of ordinary technology.
  • People expect personalization in their purchases.
  • The best strategy is to keep it simple, advanced technology is becoming less expensive, which is good for small brands.

Dave Portalatin, vice president food industry advisor, The NPD Group

  • Your product has to go to the consumer, not the consumer to you.
  • More snack foods are part of main meal, or replacement for main meals, momentum is with snacking.
  • The food category e-commerce is only 5% of retail penetration.

Neil Stern, Sr partner, McMillanDoolittle

  • Retail will change more in the next five years than in the last 50 years, by 2025, online grocery sales will be 14%.
  • Creativity and innovation, extreme value, extreme experience, the disruption we are experiencing now is going to multiply.

John Gezma, CEO, Harris Insights & Analtytics

  • 79% of Gen Zs expect a response from companies on the same day, the same hour even. 53% are shopping on their mobiles.
  • They are the ‘triple A generation’ – ambition, anxiety and activism – but 93% of them enjoy candy, enjoy sharing it with friends and in ‘super-relaxed mode’.
  • AI and the rise of the robots, will eliminate 40% of jobs in the near future.
  • When it comes to brands, if you want to retain young consumers you need to be transparent, socially responsible, treat your employees decently and take a stance on events and issues that matter to young people. If brands #fail then the Gen Xers will switch to brands more aligned to their outlook.
  • 58% say they are worried about climate change.
  • They are also looking at brands’ carbon footprint, its packaging, its choices in free-form, etc.

Downs concluded by saying "During our transformational journey over the last four years, we’ve met our challenges head on, and our focus has resulted in a measurable difference in the way our industry is perceived by our stakeholders in the nutrition, government and retail arenas​."

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