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Getting to Know Chocolate Consumers

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Getting to Know Chocolate Consumers 2019 Getting to Know Chocolate Consumers Exploring consumer demographics, consumption preferences and shopping habits 1 Copyright© 2019 National Confectioners Association For questions or comments, please contact: . Larry Wilson | Vice President, Industry Affairs All rights reserved. This publication may not be reproduced, stored in any National Confectioners Association information or retrieval system or transmitted in whole or in part, in any [email protected] form or by any means — electronic, mechanical, photocopying, recording or otherwise — without the express written permission of the National . Bill Guyton| Executive Director Confectioners Association. Fine Chocolate Industry Association [email protected] Published by: Underwritten by: Conducted by: . Anne-Marie Roerink | President 210 Analytics, LLC [email protected] The National Confectioners Association is the trade organization that advances, protects and promotes chocolate, candy, gum and mints, and the companies that make these special treats. As the leading association for the $36 billion U.S. confectionery industry, NCA helps ensure the public understands and appreciates the unique role that chocolate and candy can play in a happy, balanced lifestyle. Confections are produced in all 50 states, creating jobs for approximately 54,000 workers in more than 1,300 manufacturing facilities across the country. For every job created in confectionery manufacturing, another ten are supported in related industries. In total, more than 607,000 American jobs are supported by the U.S. confectionery industry. America's leading chocolate and candy companies support the Always A Treat Initiative, a commitment to transparency, portion guidance and choice, and consumer education. Learn more at CandyUSA.com. Getting to Know Chocolate Consumers 2019© 2 TableTable of of Contents Contents Study Highlights. 4 Introduction. 7 U.S. Confectionery Overview . 8 Chocolate and Lifestyle . 9 Chocolate Consumer Segments . 11 Chocolate Preferences . 13 Cacao Sourcing and Chocolate Certifications. 19 Shopping for Chocolate . 24 The Fine Chocolate Consumer . 29 Food for Thought . .. 33 Methodology and Study Definitions. 47 Respondent Profile . 48 Getting to Know Chocolate Consumers 2019© 3 Study Highlights Chocolate represents 60 percent of the $35 billion U.S. confectionery industry. Ranging from iconic brands to products made by micro producers, chocolate is a consumer favorite — enjoyed across ages, incomes, ethnicities and regions. But much like food choices in general, chocolate habits and preferences are changing. For one, the very different confectionery preferences among Millennials is fueling a surge in demand for flavor, ingredient and texture innovation. Additionally, megatrends, such commitment to wellbeing, convenience and transparency are driving innovation in sourcing, packaging, branding and more. This study aims to help the chocolate industry better understand the varying wants and needs among U.S. chocolate consumers. Chocolate Size and Growth U.S. chocolate sales total more than $21 billion annually. The IRI measured universe, composed of multi-outlet chains, including grocery, drug, convenience, mass and other channels, represents about 70 percent of the total market. Based on these channels alone, household penetration for everyday chocolate is 91 percent and seasonal chocolate boasts an even higher household penetration, at 96 percent. Dollar gains in 2018 were slightly below those of non-chocolate, at +0.6 percent overall. However, premium chocolate, defined as items priced at $11 per pound or more, grew more than 19 percent. Chocolate Consumer Segments The consumer survey distinguished between three main Chocolate and Lifestyle types of chocolate and provided examples to help Consumer focus on wellbeing is increasingly influencing sales across the store as optimize the consumer understanding of each: more consumers make the connection between diet, sleep and exercise. Nine in . Mainstream chocolate, i.e. Hershey, Snickers or Baby 10 consumers believe they themselves are responsible for leading a balanced Ruth lifestyle, in which chocolate has a well-established role: . Premium chocolate, i.e. Lindt, Ghirardelli or Ferrero . Consumers enjoy chocolate as a treat, averaging 2-3 times/week; . Fine chocolate, made by small artisan chocolatiers, . 84 percent of consumers agree chocolate is always a treat, never a meal who source the best quality cacao, create small- replacement; batch products with unique flavors and textures and . 83 percent believe chocolate can be part of a happy, balanced lifestyle. educate consumers about the product and process Not only do consumers feel chocolate belongs in a balanced lifestyle, it is also a Most consumers enjoy chocolate across the spectrum. beloved treat. Word associations are dominated by positive sentiment, such as In all, 90 percent of consumers enjoy mainstream yummy, tasty, delicious, good, decadent and heaven. chocolate, 70 percent premium and 27 percent consume fine chocolate. Getting to Know Chocolate Consumers 2019© 4 Switching from all chocolate types consumed to the one chocolate type consumers feel best describes their typical consumption provides insight into three vastly different consumer segments. Preferences for certifications, flavors, cacao sourcing, etc. are significantly different among the mainstream consumer segment versus the premium and core fine chocolate consumer. Chocolate Preferences Milk chocolate draws the highest outright preference, at 37 percent of consumers. Preference for dark rises with age, and fine chocolate consumers are the most likely to enjoy a mix of chocolate types. Among consumers who prefer dark, or all chocolate types equally, 36 percent say the cacao percentage has a significant influence on their purchase. Among core fine chocolate consumers, 73 percent believe the cacao percentage is important. Most consumers look for cacao shares between 66 and 80 percent, with core fine chocolate consumers leaning toward the higher cacao shares. Overall, peanut/peanut butter is consumers’ favorite added flavor, followed by caramel/toffee. Core fine chocolate consumers prefer almonds, followed by caramel/toffee and hazelnuts. Manufacturer brands are very important to mainstream and premium consumers, though one significant finding is the above-average preference for store brands among Millennials. While brand loyalty is high in the mainstream and premium segments, experimentation and trial is core to fine chocolate consumption — even if they have a favorite chocolatier. Across all chocolate consumers, 47 percent believe there is no difference in American-made versus European-made chocolate. Among the remaining 53 percent, Europe has a definite edge. Interestingly, core fine chocolate consumers are more likely to believe American-made chocolate is better, at 28 percent versus 19 percent of the total population. Cacao Sourcing and Chocolate Certifications The vast majority of chocolate consumers, 84 percent, are indifferent to where the cacao was sourced. Among fine chocolate consumers, this percentage is much lower, at 61 percent. These consumers lean more toward preferring cacao from South and Central America. Getting to Know Chocolate Consumers 2019© 5 Certifications are meaningful, in particular certifications in the areas of fair trade, The Fine Chocolate Consumer non-GMO and organic. In all cases, certifications are more meaningful to Forty-five percent of American consumers never or Millennials and of significant importance to fine chocolate consumers. However, rarely purchase fine chocolate, as defined by the when switching from the influence of the various certifications to the importance survey. An additional 41 percent do so just of actual corporate behavior in social and environmental responsibility, Boomers occasionally. Consumers who buy fine chocolate overindex. In other words, social and environmental responsibility matters to all frequently or almost exclusively make up the core generations, but the certifications to prove it are more important to Millennials. fine consumer segment. Ingredient claims, such as vegan, gluten-free or raw, also matter more to Millennials, as well as to premium and fine chocolate consumers. The core fine chocolate consumer is younger, more affluent, more likely to live in urban areas and greatly Shopping for Chocolate values social and environmental stewardship. They Supermarkets represent the primary store for groceries for about half of value both the behavior and the certifications that shoppers, but have not been able to capture the business of Millennials, who are come with it, and three-quarters are willing to pay more prone to shop at supercenters, specialty/organic stores and alternative more as a result. Experimentation is important. Fine channels. While most consumers purchase at least some chocolate at their chocolate consumers like dark, milk and white primary store, chocolate is purchased across a wide range of channels, led by chocolate equally, tend to try items from different convenience and drug stores and including festivals and farmers’ markets. chocolatiers (even if they have a favorite), and go Overall, 25 percent of shoppers have purchased chocolate online versus 60 out of their way to purchase it. They visit festivals, percent of fine chocolate consumers. Online consumers shop a variety of farmers’ markets and buy online far more often than websites to purchase chocolate, ranging from specialty
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