- One size fits all operations will flounder as consumer buying habits diversify further
- Global demand for cocoa could outstrip supply, forcing manufacturers to turn to artificial cocoa
- The personalised market is the next frontier for chocolate – if costs can be managed
Despite economic headwinds battering consumer confidence, the global chocolate market remains robustly defiant and is predicted to grow by an average of 2 per cent a year for the next five years. Yet it is not all plain sailing for manufacturers, who face a rising proliferation of consumer tastes, coupled with volatility in the cocoa markets, warns KPMG in a new report entitled, “The Chocolate of Tomorrow”.
KPMG believes that a combination of shifting consumer demand and regulatory pressure will reshape the industry and the chocolate bar. Key findings from the report include:
John Morris, head of consumer markets at KPMG said: “Fast developing countries are rapidly growing a sweet tooth for chocolate, and many producers are battling to stay on top as tastes diverge and empowered consumers demand more from their products. The marketplace for chocolate is shifting rapidly, and spotting and targeting the countries and regions that are likely to grow quickly will make the difference between the winners and losers in a highly competitive environment.”
The report recommends that manufacturers adapt their product lines to suit the marketplace they are targeting. In Mexico 52 per cent of the population is under 20 and 80 to 90 per cent of chocolate and candy products are targeted at children. Yet in Russia and China premium products are in demand.
Manufacturers must also target growth opportunities present in both fast developing markets and saturated Western markets. “It is vital that manufacturers tap into under-represented seasonal and gift markets as a matter of urgency,” explained Morris.
“In China confectionery is booming as a gift item, with over half of all chocolate bought as a gift. Festivals such as the Chinese Luna New Year present the opportunity to run seasonal launches of chocolate products to meet the demand from the Chinese consumer. In the West, Easter is far from saturated and represents a rare area of growth in a traditional market place.”
Morris believes that demand for increased personalisation of products could be the next consumer-driven revolution in the industry. “Manufacturers have begun to dip their toe into the water and offer consumers a range of options to personalise the products they buy, from choosing the contents of a selection box, personalising the packaging to creating their own bar of chocolate, with the toppings of their choice,” said Morris.
“The personalised market could be the next frontier for chocolate, but only if manufacturers can balance costs and opportunities.”
The report entitled “The Chocolate of Tomorrow” was launched at the Chocovision Conference held in Davos, Switzerland on 6 June 2012. The report contains expert analysis and commentary from KPMG and data compiled from a variety of industry sources.
The report is available on request.
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