Chocolate Confectionery - UK - April 2010[1]
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Transcript of Chocolate Confectionery - UK - April 2010[1]
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Chocolate Confectionery
April 2010
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2el International Group. All rights reserved. Confidential to Mintel.
How rising commodity prices have affected
the chocolate confectionery market
What have been the opportunities for new
product development in the market?
How competitive has the market been, and
is there room for smaller players?
What are the implications of Krafts
takeover of Cadbury?
What are consumers primary motivations
for buying chocolate confectionery? How has the chocolate confectionery
market been affected by consumers
increased health concerns?
Key themes
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3el International Group. All rights reserved. Confidential to Mintel.
Commodity prices inflate value sales growth
Value sales of chocolate confectionery increased by 11.7% between 2007 and 2009, however with the
effects of inflation taken into account, value sales actually fell by 2.9%
Commodity price inflation put pressure on manufacturers margins which led to initiatives, that enabled
them to shore up raw ingredients supplies
Dairy Milk still on top
Dairy Milk is still the top brand in the chocolate confectionery category accounting for just over a tenth of
all chocolate confectionery sales
It has retained their status as the leading chocolate confectionery brand, helped by significant marketing
support and new product innovation
Consumers still like their treats
Consumers are aware of the need to maintain a healthy diet, and to take care of their health, just under50% claim to still like treating themselves to foods they know are not good for them
Consumers are primarily eating chocolate as a way to treat themselves, and it is also a way for parents
to treat their children
Despite the calories, and high fat content of chocolate confectionery, women especially use chocolate as
a way to reward themselves
Summary
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4el International Group. All rights reserved. Confidential to Mintel.
Internal Market Environment
The growth in fair trade sales
has continued unabated
despite the economic
downturn with chocolate
confectionery taking a larger
stake of this market
Obesity levels in adults and
children have increased atworrying rates forcing the FSA
to embark on health campaigns
advising consumers how best
to maintain a more balanced
diets
Half of consumers admit totreating themselves to
foods they know are not
good for them, despite
being aware of the need to
maintain a healthy diet
Educational establishments
have being trying to stem
rising obesity levels, workingwith key stakeholders in
schools to ensure children are
eating a healthy diet
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5el International Group. All rights reserved. Confidential to Mintel.
Broader Market Environment
Chocolate confectionery
manufacturers have faced
increased pressure as the
price of cocoa has continued
to rise
Rising levels of affluence have
had a beneficial effect on theUK confectionery market,
helping to increase spending on
treats
In the next five years, the number
of children aged 5-9 is anticipatedto increase by 12% up to 2015.
This is positive for the market, as
the purchase of chocolate is
strongly linked to families with
children
The Food Standards Agency
(FSA) is urging manufacturers to
increase the amount of money
they spend promoting their
healthier food ranges
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6el International Group. All rights reserved. Confidential to Mintel.
Manufacturers have sought to meet the needs of
consumers by reformulating their product ranges,
removing artificial colours and additives
Consumers continued need to treat themselves
has helped sustain interest and sales in thechocolate confectionery market
The number of children aged 5-9 is projected to
increase by 11.9% between 2010 and 2015, and
they represent an important target for chocolate
confectionery
The projected 18.8% growth in ABs between 2010
and 2015 will benefit the premium chocolate
confectionery segment
Ethical considerations have featured more in new
product launches in 2009, compared to 2007.
Cadburys sourcing of fair- trade cocoa for its
Dairy Milk brand will boost the fair trade market
Concerns about obesity levels in adults and
children is impacting on chocolate
confectionery consumption
Decreases in above-the-line spend and new
product innovation will hinder future growth inthe market
The ban on TV advertising to children, and the
restriction of consumption and sales of
chocolate confectionery has continued to be a
challenge for manufacturers
Rising cocoa prices impacted on manufacturingcosts for chocolate confectionery manufacturers
Penetration of chocolate confectionery has
continued to fall, decreasing by 2.1% between
2005 and 2009.
Strengths and Weaknesses
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Whos Innovating ?
Cadbury dominated new launches, with two fifths ofits innovation being focused on their Dairy Milk andGreen and Blacks brands
Ethical considerations have increased in prominencein the chocolate confectionery category in 2009compared to 2007, while there were fewer launches
of premium products
Limited edition launches featured more frequently inthe chocolate confectionery market, and helpedbring novelty to the market
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8el International Group. All rights reserved. Confidential to Mintel.
Forecast of UK Retail value sales of Chocolate Confectionery, 2005-15
Between 2007 and 2009, value sales of chocolate confectionery increased by 11.7% toreach an estimated 2.3 billion in 2009
The market was believed to be recession-proof; however demand for the occasionalindulgent treat has not supported sales growth in real terms as penetration of
chocolate has fallen
Source: Mintel
Market Value and Forecast
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9el International Group. All rights reserved. Confidential to Mintel.
Chocolate confectionery by segment, 2005-09
Source: Mintel
Health has been on the agenda for chocolate confectionery, as thegovernment has continued to tackle the issue of portion control which willaffect countlines
The premium category struggled between 2007 and 2009 as consumersfocused on value, and this was reflected in a drop in the number of premiumlaunches from 29% (of all launches in the category) in 2007 to 12% by 2009
Segment Performance
2005 2007 2009 % ch an ge % ch an ge
m % m % m % 2005-09 2007-09
Countlines 1,06 3 55 1,092 5 3 1,237 54 +16.4 +13.3Moulded bars 543 28 614 3 0 71 0 31 +30.8 +15.7Self lines 343 18 345 1 7 34 4 15 +0.2 -0.3
To ta l 1,94 9 100 2,050 100 2,291 100 +17.5 +11.7* f igures ma y not equal due to round ing
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10el International Group. All rights reserved. Confidential to Mintel.
Manufacturers' share of the Chocolate confectionery market, 2005 - 2009
The five leading manufacturers led by Cadbury and Mars accounted for approximately 86% ofall chocolate confectionery sales
Cadbury focused a great deal of its attention in 2009, fending off Kraft Foods attempts to takeover the company
Mars has not been very active with new product launches between 2008 and 2009
Dairy Milk has retained its status as the top-selling chocolate confectionery brand, helped bysignificant marketing support and new product innovation
Source: Mintel
Market Share
Cadbury
Mars
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11el International Group. All rights reserved. Confidential to Mintel.
MAIN MONITORED MEDIA ADVERTISING EXPENDITURE ON
CHOCOLATE CONFECTIONERY (BARS AND COUNTLINES), 2006-09
Between 2008 and 2009, above-the-line support dropped 5.2% as manufacturers focused theirresources on tackling commodity price inflation
Advertisers have had to be more creative in their above-the-line campaigns due to therestrictions they face, in addition to squeezed marketing budgets
On average between 2006 and 2009, two fifths of Cadburys advertising expenditure was spenton its leading brand, Dairy Milk
Source: Nielsen Media Research/Mintel
Brand Communications and Promotions
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12el International Group. All rights reserved. Confidential to Mintel.
Chocolate confectionery choices
Chocolate confectionery, especially
bars, remain universally popular with
consumers, however, since 2005 their
penetration has continued to fall
Consumption profiles vary for
chocolate consumption, however,
women are more likely to be the main
consumers of any type of chocolate
confectionery
Standard bars of chocolate continue to
be the most popular type of chocolate
for consumers, followed by solid bars
such as Dairy Milk
TYPES OF CHOCOLATE CONFECTIONERY BOUGHT IN THE LAST
TWELVE MONTHS, FEBRUARY 2010
Base: 997 adults aged 15+
Source: BMRB-OMNIBUS, A DIVISION OF TNS-RI/MINTEL
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13el International Group. All rights reserved. Confidential to Mintel.
Repertoire of chocolate confectionery bought
REPERTOIRE OF CHOCOLATE CONFECTIONERY
BOUGHT IN THE LAST TWELVE MONTHS, FEBRUARY
2010
Base: 997 adults aged 15+
Just over a quarter of consumers are eating
four or more types of chocolate
confectionery, with a quarter sticking to just
one type
There are significant differences in profiles
for consumers who just stick to one type,
compared to the more adventurous
consumers who offer manufacturers a key
target for new product launches
The key demographic of those buying just
one type of chocolate confectionery are
men, age 45+ ,C2, retired, no children in the
household and live alone
By contrast, the key demographic of those
buying four or more types of chocolate
confectionery are women, aged 15-54,
families, children in the household and 3 or
more people living together
Source: BMRB-OMNIBUS, A DIVISION OF TNS-RI/MINTEL
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14el International Group. All rights reserved. Confidential to Mintel.
Reasons for buying chocolate confectionery
REASONS FOR BUYING CHOCOLATE CONFECTIONERY, FEBRUARY 2010
Base: 866 adults aged 15+ who bought some form of chocolate confectionery in
the last 12 months
Source: BMRB-OMNIBUS, A DIVISION OF TNS-RI/MINTEL
Despite the calories and high fat level of chocolate confectionery, consumers (especially women) usechocolate as a way to reward themselves
Chocolate for me a nice treat and I buy it not only for myself, but also for my family. In that case, Ibuy for each person, the chocolate he/she likes. I do not buy chocolates only for this; I buy
chocolates as a present/gifts as well.
- - 25-34 year-old C2DE female
%
Treat for myself 58Treat for my children 37A gift 35For a special occasion (eg Christmas, Easter) 30For cooking/baking 16To satisfy a chocolate craving 15Snack while on the move (eg driving in car, taking the train, walking e tc) 14When I am bored 9For energy boost 9To help me unwind 7Snack between meals/keep me going until my next meal 5Snack after a meal 5Meal replacement 2None of these
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15el International Group. All rights reserved. Confidential to Mintel.
Attitudes towards chocolate confectionery
ATTITUDES TOWARDS CHOCOLATE CONFECTIONERY, FEBRUARY2010
Base: 866 adults aged 15+ who bought some form of chocolate
confectionery in the last 12 months
Source: BMRB-OMNIBUS, A DIVISION OF TNS-RI/MINTEL
Two fifths of consumers state
that they prefer branded
chocolates, with just under athird sticking to the same
brand of chocolate bar
Only a tenth of consumers feel
that own-label is just as good
as the branded options
Over-55s are more likely to
prefer branded chocolates,
with 35-54 year olds more
likely to stick to the same
brand of chocolate
confectionery
%
I prefer branded chocolate 41I prefer milk chocolate 35I tend to buy chocolate on impulse (not a planned purchase) 32They are good for sharing with friends/family 31I tend to stick to the same brand of chocolate bars (eg Cadbury) 31
Dark chocolate is healthier 27I have cut back on the amount of chocolate I buy for health reasons 19I like to try new chocolate flavours/formats 12Own label chocolate bars taste as good as branded ones 11I check the cocoa content of chocolate 10I avoid buying chocolate for my children 10I do not believe that dark chocolate has positive health benefits 8I don't trust fairtrade products to give communities money as promised 7Don't know 2
None of these 2
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16el International Group. All rights reserved. Confidential to Mintel.
Your contact
tel: +44 20 7606 4533
email: [email protected]
mintel.com
Senior Consumer Analyst
Vivianne Ihekweazu