Convenience

‘Indulgence matters’: chocolate and candy sales amplify convenience counter

By Kristine Sherred contact

- Last updated on GMT

Candy sales spike at the holidays, with Easter leading the way, said Coen Oil CEO Charlie McIlvaine at the NACS State of the Industry Summit in Chicago.
Candy sales spike at the holidays, with Easter leading the way, said Coen Oil CEO Charlie McIlvaine at the NACS State of the Industry Summit in Chicago.

Related tags: Convenience stores, Indulgence, Premium chocolate, Candy, Candy bar

The overriding theme at the National Association of Convenience Stores (NACS) annual State of the Industry Summit, held in Chicago, was one of evolution. The old convenience store model of ‘smokes, cokes and gasoline’ has morphed into a more complex retail reality.

Candy sales account for about 4% of in-store sales at US convenience stores, but novelty and seasonal confections have made the category one to watch – especially as the industry shifts gears to keep pace with consumers and other retailers infringing on the small-format, grab-and-go model.

Snacks remain an important part of in-store convenience sales, surpassing 7% of non-fuel dollars.

“We’re the first mile. We’re the last mile. No other business can be that. Remember food. Do not just remember it – do something about it.”

Overall, foodservice sales at C-stores have jumped more than 5% in the past decade to a record $242bn – nearly a quarter of in-store (non-fuel) sales, behind tobacco products.

‘Food works’: convenience goes premium

Fuel remains the dominant source of revenue for c-stores, but as the efficiency of car engines improves, the frequency of trips to the gas station has dipped. Stores, in turn, have amplified their foodservice options to compete for consumer dollars.

“Food works – it’s at a matter of what and how,”​ said Charlie McIlvaine, CEO of Coen Oil out of Washington, Pennsylvania. He emphasized that convenience as a category has reinvented itself many times.

“We’re the first mile. We’re the last mile. No other business can be that,”​ he added. “Remember food. Do not just remember it – do something about it.”

Better-for-you and other alternative snacks have permeated the convenience landscape, but consumers still find room for ‘that element of delight,’ said Laurie Demeritt, CEO of The Hartman Group, a food and beverage consumer insight firm.

“Indulgence matters,” ​agreed Todd Hale, former Nielsen analyst who now runs his own marketing research firm.

Within the candy segment at c-stores, of which there are more than 150,000 in the US according to NACS, chocolate bars and packs still lead, followed by non-chocolate candies, gum and bagged peg candy.

Novelty and seasonal candies are driving growth in the category, especially around the four major holidays led by Easter and Halloween. Sales also peak on weekends, according to data presented by Jason Lobel, CEO and co-founder of SwiftIQ, and combination promotional deals can also entice customers to indulge.

What's new in c-stores candy?

The ‘Cool New Products’ showcase at the NACS summit highlighted forthcoming products from legacy brands, plus a few up-and-coming disruptors. Here are a few that stood out:

- Spinning off Reese’s successful Reese’s Cups stuffed with Reese’s Pieces​, Hershey’s has added the peanut butter candies to its classic bar.

- Reese’s also showed off its 30% thinner cups and the much-discussed ‘lovers’ cups​ with more chocolate or peanut butter.

- Perfetti Van Melle USA has jumped on the gummy train with Airheads Gummies​ in six classic flavors, including blue raspberry, green apple and watermelon.

- Jolly Rancher​ has transported two fan-favorite flavors ​Blue Raspberry and Watermelon ​ into Bubble Yum gum.

- After Mentos​ gum, the mint maker debuts a slim pack​ of 30 mints.

- Dunkin’ showed off its Coffee Thins​ chocolate squares, which debuted last year, in flavors like caramel, pumpkin spice and peppermint mocha.

Salty sticks around

Potato chips and other salty snacks lead the snack segment at c-stores, but tortilla or other corn chips are fast on their heels, gaining 6.4% in sales according to Nielsen.

In the alternative snacks category, meat snacks have snagged nearly double the sales dollars of other alt-snacks. Energy and protein bars land in third with granola and fruit snacks coming in fourth.

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