A Candy Constant
Sales were off a bit last year, but caramels remain a candy category staple. And they’re red hot as an ingredient in other confectionery concoctions, beverages and baked goods.
Caramel category sales
declined a bit in food, drug and mass merchandisers (excluding Wal-Mart)
last year. For 2004, sales of caramels/taffy apples/kits/dips were down by
5.3 percent, as tracked by Information Resources Inc.
Of course, the decline detailed by IRI does not factor
in the rising popularity of caramel as an ingredient in products ranging
from candy bars to brownies to Starbucks’ Frappuccinos.
And it hasn’t stopped caramel vendors from
continuing to get creative with new product forms and flavors, all designed
to help keep the category contemporary.
Imperatives
Marketers of caramels maintain that this much-loved
candy category staple has a more nutritious profile than many other
confectionery treats. Some companies have been touting the calcium content
of caramels, which is a savvy move.
U.S. consumers tend to favor butter caramels,
especially those soft enough to be chewed easily.
Adjacencies
Caramels belong in the regular candy set, of course.
They also work well in the bulk candy assortment. Placing them adjacent to
marshmallows and other baking ingredients also makes sense. In addition,
the taste and flavor profile of caramels makes them a natural for placement
near coffee and baked goods.
Marketing
Capitalizing on the nostalgia appeal of caramels is
one legitimate approach. For many consumers, caramels are a favorite from
childhood.
The category is staying fresh, however, by combining
new flavors and fillings. Product developers have experimented with
chocolate, vanilla, peanut butter, strawberry and other fruit flavors. A
number of companies have unveiled caramels targeted to Hispanic consumers,
thanks to the addition of a guava or coconut filling or a dulce de leche
flavoring.
Caramel makers also have addressed the diet and health
issue with the rollout of new sugar-free varieties.
Cross Merchandising
Near apples and fruit is the logical
cross-merchandising opportunity for caramels. Couple it with a sign about
“healthy snacking” and you may have a new twist on an old
theme. Near nuts in the produce section is another good one to try. But for
retailers who want something really unique: how about a “make your
own Twix” display in the bakery section with plain wafer or
shortbread cookies, some chocolate sauce, and, of course, caramels.
Outlook
There are plenty of options for caramel category
creativity, including introducing confectionery treats that combine caramel
with nuts and nontraditional fruit flavors. The rollout of sugar-free
caramels also opens the door for more category growth.