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CONFECTIONERY CONVERSATION Growing from adversity; confectionery’s 20-year evolution


TRBusiness is shining a spotlight on the confectionery category in a 12-part series called ‘Confectionery Conversation’, sponsored by Mars Wrigley International Travel Retail. In the sixth edition of this initiative, Charlotte Turner peers back into history to see how the category has had to adapt following the abolition of intra-EU duty free 20 years ago.


T


wenty years ago, the confectionery category was in trouble. Following the abolition of intra-EU duty free,


sales across all brands were suffering in Europe. As The Duty Free Business reported in November 1999, confectionery brands were hoping that a fall in L&T sales might lead to a transfer of spending power by confused passengers to areas not traditionally recognised as duty free. Alas, many companies found this not


to be the case at some of Europe’s busiest airports. Interestingly, at the time retailers complained of low penetration figures as travellers had become immediately disinterested in shopping without the duty free discount. Twenty years on and the conversation


surrounding low penetration figures persists, despite the fact that the category offer is almost unrecognisable to that of 1999. Pop-ups and sampling opportunities outside of the core duty free stores were far less common than they are now and digital marketing and communication was non-existent. Without the use of social media


platforms (Facebook launched in 2004) or purpose-built retailer/airport websites or applications to communicate with passengers in a timely manner, brands relied on their equity built in domestic markets to attract customers into stores.


However, it was not all bad news for


confectionery back then. In 1999 the industry was beginning to bring about some important changes, such as the introduction of more travel exclusive products to help offset negative price perceptions.


Rolling with the times Travel exclusives today have become a vital component of the duty free & travel retail offer to the point where the industry is now welcoming new brands that are totally exclusive to the channel. Following the abolition of intra-EU duty


free the confectionery category has well and truly dusted itself off and adapted itself to a new trading environment. Many suppliers are now not just selling chocolate, but communicating the brand’s core values at the same time as offering a memorable experience. No longer all about ‘grab & go’ –


although impulse/self consumption will always be an important purchase driver in DF&TR – companies such as Nestlé, Mondelez, Mars Wrigley, Ferrero, Lindt etc. are all looking beyond the transactions. In addition, they are now all cognisant


of the fact that their individual strategies or company visions must be aligned with an overarching aim to see the whole


Confectionery Consumer Insight XXXXX


Sharing and informal gifting account for 35% and 23% of total confectionery sales, respectively, at Dubai Duty Free.


category thrive; growing the whole pie rather than just their respective slices. «


Snapshot from 2016: then versus now


Swiss research firm m1nd-set has kindly provided TRBusiness with a snapshot of confectionery in DF&TR retail from 2016. From this, we can see how the category has continued to adapt and develop since 1999. Footfall rates have actually slightly


increased (from 12% in 2016 and 2017 to 13% in 2018/19), however, the conversion rate has dropped from 71% in 2016 to 60% in 2018/9; a very illuminating figure. Interestingly, consumers are also


less likely to pre-plan their visits to confectionery areas of stores, with the figure falling from 42% in 2016 to 38% in 2018/19. Having said this, those purchasing


confectionery items as gifts increased from 46% to 53%. Gifting is now the top purchase driver in DF&TR with self-consumption still representing a significant share of shoppers.


JUNE 2019


TRBUSINESS 15


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