Marketplace

With over $150bn of retail sales globally in 2008, confectionery is a large market. It is in fact the fourth largest segment in packaged foods – a global market worth an estimated $1,800bn.

An attractive market

The confectionery market has grown steadily over the past five years at a rate of 5% (compounded annual growth rate). Growth in developed markets, which represent around 60% of the total by value, has been at around 3% per annum whereas growth in emerging markets, the remaining 40%, has been strong at around 10% per annum.

Innovation is a major driver of growth in developed markets where premium and ‘better-for-you’ products are prevailing themes.

The faster pace of growth in emerging markets can be attributed to higher population growth rates and rising levels of prosperity, which has increased demand for affordable luxuries and treats.

Established brands play an important part in the world of confectionery, with a relatively low penetration of private label. The share of private label products has been stable at 4% for the last five years.

Confectionery products are sold through a wide range of outlets which vary from market to market. The share of the impulse channel – outlets where product is bought on impulse from display rather than as part of planned shopping – is roughly 40% in developed markets and is greater in some emerging markets.