Exclusive: Euromonitor reveals major snacks upturn trends at World Confectionery Conference
The Euromonitor International research group has revealed a key 53.4% global growth in online snacking sector sales in 2020, driving a total market with a combined value of $547 billion across confectionery, savoury ranges, sweet biscuits and bars, as well as ice cream, writes Neill Barston.
Speaking at the World Confectionery Conference, Natalia Theofilopoulou, a food and nutrition research analyst for the London-based organisation, offered a keynote presentation reflecting of the state of international markets – which have benefitted from greater levels of eating at home – with luxury product ranges emerging as particular winners during the pandemic.
Reflecting on major pre-pandemic trend development, she explained the key influencing factors were greater levels of urbanisation, demographic shifts of populations around the world, as well as the growing influence of technology, enabling a far greater array of snacks and confectionery to be created and gain commercial traction. These combined factors have led to the concept of ‘snackification’ where consumers are eating less main meals, and adopting a more ‘on-the-go’ lifestyle in many instances.
Significantly, urbanisation ‘has increased massively’ within the last decade, with a total of 56% of populations now living in towns and cities, (56% compared to less than 52% in 2011, resulting in changes in how people are living, with a key increase in single person households, as well as consumers feeling time-pressured, demanding quick food and snacks solutions.
In terms of direct trends, 87% of respondents to Euromonitor’s studies revealed they had smartphones, with over half having strict boundaries between working life and personal time, which has created market demand for food and snacks at specific alternative points in a day beyond traditional meal times. Linked to this, there has been a 139% increase in e-commerce sales between 2014-2019 which has played a key influence on the sector’s performance.
Theofilopoulou said: “Time pressure has turned consumers towards more convenient and flexible food solutions, which can be consumed anytime anywhere. This of course includes ready-to-eat foods such as snacks.
“In 2020, covid-19 has completely changed daily routines of consumers. It has disrupted the historic lifestyle patterns, and affected the snackification trend and overall snacks trends. The most important change has been a drastic reduction in mobility. In 2020 consumers were forced to spend most of their time at home, due to local and national lockdowns, as well as quarantines,” which she explained was backed-up by Google traffic data revealing a steep decline in travel from March 2020.
This had the direct impact of nearly all sites where food can be purchased outside the home experiencing a dramatic decline in movement, with only medical pharmacies bucking that trend. The continued threat of new coronavirus infection rates and hesitancy of consumers resulted in a major shift in behaviour – having a strong negative impact on snacks.
“The on-the-go market became non existent, as commuting to work became replaced by working from home – with food service venues at entertainment industry closing.
“This created a huge change on at-home eating habits. The retail sales of the entire industry of packaged foods benefitted from the closure of these channels, as consumers were forced to replace the meals they used to have at restaurants with home made food. We have seen a strong growth in packaged foods, especially cooking ingredients, and also snacks retail sales (though these recorded the smallest growth due to the lost sales from out of home snackification).
As she continued, the indulgence sector has seen a rise in indulgent snacks categories, with consumers being forced to think more creatively of ways to enjoy at-home dining – with chocolate, crisps and ice cream, with 43% of those Euromonitor contacted in a recent study said that they turned to their favourite treats while watching TV or streaming content. Breakfast at home, and increased alcohol consumption increases have also impacted on the sector.
While online sales have increased 53.4%, growth elsewhere was far more modest, put at 4.5% in supermarkets for last year, while forecourt retails suffered a 2.9% decline in the past twelve months. Physical stores running out of stock has also been a factor.
Significantly, new product development has been reduced amid the pandemic, with companies within the confectionery and snacks sector actively reducing their ranges in order to optimise their product offerings to serve favoured brands, citing Mondelez International as a key example in acknowledging a need to reduce the variety of series available.
According to Euromonitor’s data, confectionery category SKU’s were cut from above 250 to below 200 between February 2020 and June 2020, with sweet biscuits fairing even worse, going from over 150 to just over 100 during that timeframe.
However, in response, companies came up with some creative solutions including Unilever introducing its DIY make my Magnum ice creams and Lindt launched an interactive chocolate event to engage with consumers at home.
Looking ahead to the remainder of 2021, Theofilopoulou noted that its data gathered over the past year pointed to many of the altered patterns of eating and trends being far more than ‘a temporary blip’ in lifestyles.
This has already seen a noted growth in snacks and confectionery businesses offering product lines that not only offering indulgent lines, but are also delivering healthier options, including devising ranges with probiotic enhancement in light of the pandemic.
She added: “We see that the vaccination programme is continuing around the world, with the out-of-home market recovering. So consumers will partially return to their old habits and are moving into a new long-term normal. but many of the behaviours they have built up in 2020 are expected to continue.”
- Register for the World Confectionery Conference here, and see the full presentation
- For further information on Euromonitor International, visit www.euromonitor.com