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Sugar Confectionery - Canada - January 2015

“Sugar and gum confectionery have broad appeal, but manufacturers are hampered by a number of industry problems. Consumers tend to eat confectionery only occasionally and their usage of gum is on the wane. Competition from other treat categories is taking candy and gum users away, and concern about childhood obesity is causing parents to cut back on purchases for the youngest and most enthusiastic candy eaters. Nonetheless, there is room to grow the category by taking advantage of seasonal opportunities and expanding beyond the ‘big four’ holidays to encourage consumers to view ‘seasonal’ sugar confectionery consumption more broadly.”
– Marcia Mogelonsky, Director of Insight, Mintel Food and Drink

This report looks at the following areas:

  • Sugar and gum confectionery have a big following
  • But, most users eat the products only infrequently
  • Health issues are likely to challenge the market
  • But, there is room to innovate around seasonal opportunities


The Canadian sugar and gum confectionery market has seen very slow growth over the past five years, and the forecast for the next five years suggests another period of slow growth.

Sugar and gum confectionery includes hard and chewy candy, liquorice, caramels, marshmallows, lollipops, mints and medicated confectionery, as well as chewing gum and bubble gum. While the products have significant penetration, used by more than nine in 10 adults, their usage tends to be infrequent or occasional, suggesting that while consumers are interested in buying/using candy and gum, they are not frequent visitors to the category.

Part of the reason for consumers’ only vague interest in candy and gum centres around the fact that there are so many other products on the market that are considered to be treats, in the same way as candy and gum. Chocolate confectionery is sugar confectionery’s biggest rival, and more than a third of consumers actually prefer chocolate confectionery to sugar confectionery when choosing a treat. Other barriers to entry for sugar confectionery include those centred around health; consumers who are trying to eat a balanced diet  are likely to give up on treats such as sugar confectionery as a way of reinforcing healthy eating habits.

The demise of the gum confectionery segment has also had an impact on overall category sales. Canadian consumers tend to use gum primarily for oral care or breath freshening, and interest in the segment is otherwise on the decline, in Canada and across other developed markets as well.

 

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Table of contents

  1. Introduction

      • Definition
        • Methodology
          • Abbreviations
          • Executive Summary

              • The market
                • Figure 1: Forecast of Canada retail sales of sugar and gum confectionery, by volume
                • Figure 2: Forecast of Canada retail sales of sugar and gum confectionery, by value
              • Market Factors
                • Obesity is an issue for many Canadians
                  • A new ruling from Health Canada could help the gum segment
                    • A growing senior population may result in more slowing of the market
                      • Companies, Brands and Innovation
                        • Multinationals lead Canadian brands
                          • Innovation grows in sugar confectionery and lags in gum
                            • The Consumer
                              • Almost all Canadians eat candy or gum, at least occasionally
                                • Figure 3: Frequency of consumption of sugar and gum confectionery, by type, November 2014
                              • Consumers primarily choose products based on flavour and brand
                                • Figure 4: Most important reasons for choosing sugar confectionery products (ranked #1), November 2014
                              • Although candy is indulgent, consumers are interested in healthier options
                                • Figure 5: Interest in new products, November 2014
                              • Consumers pull back on candy consumption because of health issues
                                • Figure 6: Barriers to consumption, sugar and gum confectionery, November 2014
                              • For more than half of candy eaters, confectionery is an impulse treat
                                • Figure 7: Attitudes towards candy, November 2014
                              • Gum is primarily seen as a breath-freshening product
                                • Figure 8: Attitudes towards candy, November 2014
                              • What we think
                              • Issues in the Market

                                  • Sugar and gum confectionery have a big following
                                    • But, most users eat the products only infrequently
                                      • Health issues are likely to challenge the market
                                        • But, there is room to innovate around seasonal opportunities
                                        • Trend Application

                                            • Trend: Sense of the Intense
                                              • Trend: Make it Mine
                                                • Trend: The Real Thing
                                                • Market Drivers

                                                  • Key points
                                                    • Trend toward reducing sugar may cause decline in confectionery consumption
                                                      • Figure 9: Body mass index, self-reported rate of being overweight or obese among Canadian adults, 2009-13
                                                    • New ruling from Health Canada could help the gum sub-category
                                                      • Canada’s older population expected to grow
                                                        • Figure 10: Projected trends in the age structure of the Canadian population, 2014 versus 2019
                                                        • Figure 11: Heavy, medium and light consumption of sugar and gum confectionery, by age, November 2014
                                                      • Economic overview
                                                        • Consumer confidence and disposable income remain steadfast
                                                          • Figure 12: Consumer Confidence Index, monthly, January 2008-July 2014
                                                          • Figure 13: Household disposable income and saving rate in Canada, Q1 2008-14
                                                        • Key economic indicators suggest higher food prices are in-store for Canadians
                                                          • Figure 14: Monthly movements in selected major components of the Canadian Consumer Price Index, seasonally adjusted, 2009-14
                                                          • Figure 15: Annual average exchange rates for the Canadian dollar, 2010-14
                                                        • The US is the category’s biggest trade partner
                                                          • Figure 16: Canadian imports, sugar and gum confectionery, top 10 countries, 2012-2013
                                                          • Figure 17: Canadian exports, sugar and gum confectionery, top 10 countries, 2012-2013
                                                      • Competitive Context

                                                        • Key points
                                                          • Chocolate confectionery may be the category’s biggest challenger
                                                            • Figure 18: Per capita consumption of chocolate confectionery vs. sugar and gum confectionery, 2010-2014
                                                            • Figure 19: Barriers to consumption, by frequency of consumption by type, November 2014
                                                          • But other snacks also offer consumers a “quick bite”
                                                            • It may depend on whether the consumer is looking for sweet or salty
                                                              • Figure 20: Value retail sales (CAD $ billion) in select “impulse treat” markets, Canada, 2010-14
                                                          • Strengths and Weaknesses

                                                            • Strengths
                                                              • Weaknesses
                                                              • Who’s Innovating?

                                                                • Key points
                                                                  • Store brands and large multinationals vie for top spot in innovation
                                                                    • Figure 21: Launches of sugar and gum confectionery, by top manufacturers, 2012-2014
                                                                  • Chewy candy is the major focus of innovation
                                                                    • Figure 22: Launches of sugar and gum confectionery, by sub-category, 2012-2014
                                                                  • Seasonal products account for more than a quarter of new launches
                                                                    • Figure 23: Launches of sugar and gum confectionery, by top claims, 2012-2014
                                                                • Market Size and Forecast

                                                                  • Key points
                                                                    • The sugar confectionery market shows little growth
                                                                      • Figure 24: Canada value sales for sugar confectionery and gum, at current and constant prices, 2009-2019
                                                                    • Volume sales have remained stagnant
                                                                      • Figure 25: Forecast of Canada retail sales of sugar and gum confectionery, by volume, 2009-19
                                                                    • Value sales are not poised for any major increase
                                                                      • Figure 26: Forecast of Canada retail sales of sugar and gum confectionery, by value, 2009-19
                                                                    • Forecast methodology
                                                                    • Market Segmentation

                                                                      • Key points
                                                                        • The category is suffering from gum’s demise
                                                                          • Figure 27: Sugar and gum confectionery, retail market segmentation by volume (000 tonnes)
                                                                          • Figure 28: Sugar and gum confectionery, retail market segmentation by value (m CAD)
                                                                        • Soft (chewy) candy and mints show some growth …
                                                                          • Figure 29: Sugar confectionery, retail market segment by volume (000 tonnes)
                                                                          • Figure 30: Sugar confectionery, retail market segment by value (m CAD)
                                                                        • … while gum sales slide
                                                                          • Figure 31: Gum confectionery, retail market segmentation by volume (tonnes)
                                                                          • Figure 32: Gum confectionery, retail market segmentation by value (m CAD)
                                                                      • Market Share, Companies and Products

                                                                        • Key points
                                                                          • Mars and Mondelēz are the market leaders
                                                                            • Figure 33: Sugar and gum confectionery, company retail market share by value (%)
                                                                          • Mars, Incorporated
                                                                            • Mondelēz International
                                                                              • August Storck KG
                                                                                • The Hershey Company
                                                                                  • Dare Foods, Limited
                                                                                  • The Consumer – Trends in Usage

                                                                                    • Key points
                                                                                      • Almost all Canadians eat candy or gum
                                                                                        • Figure 34: Frequency of consumption of sugar and gum confectionery, by type, November 2014
                                                                                      • Males and younger Canadians are more avid consumers of hard and chewy candy
                                                                                        • Figure 35: Frequency of consumption of hard and chewy candy, by gender and age, November 2014
                                                                                      • Most Canadians also enjoy both gum and mints regularly
                                                                                        • Figure 36: Frequency of consumption of gum and mints, by gender and age, November 2014
                                                                                      • Two thirds of Canadians eat six or more types of sugar confectionery products
                                                                                        • Figure 37: Repertoire of consumption of sugar and gum confectionery, by age, November 2014
                                                                                    • The Consumer – Factors in Choosing Sugar and Gum Confectionery

                                                                                      • Key points
                                                                                        • Favourite flavours and brands are key reasons for choosing one product over another
                                                                                          • Figure 38: Reasons for choosing sugar confectionery products – top-five ranked, November 2014
                                                                                          • Figure 39: Most important reasons for choosing sugar confectionery products (ranked #1), November 2014
                                                                                        • Almost a third of the youngest candy eaters turn to flavor first, while only 19% of the oldest candy eaters do so
                                                                                          • Figure 40: Top reason for choosing one product over another, by age, November 2014
                                                                                      • The Consumer – Interest in new products

                                                                                        • Key points
                                                                                          • Summary of interest in new products
                                                                                            • Figure 41: Interest in new products, November 2014
                                                                                          • There is interest in flavour innovations
                                                                                            • Figure 42: Interest in flavour-related new products, November 2014
                                                                                          • Interest in texture-related innovations are less pronounced
                                                                                            • Figure 43: Interest in texture-related new products, November 2014
                                                                                          • Canadians show significant interest in health-related innovations
                                                                                            • Figure 44: Interest in health-related new products, November 2014
                                                                                          • Influence of sweetener use
                                                                                            • Figure 45: Interest in buying favourite candy product with sweetener instead of sugar, November 2014
                                                                                          • Interest in other innovations
                                                                                            • Figure 46: Interest in other new products, November 2014
                                                                                        • The Consumer – Consumption Barriers

                                                                                          • Key points
                                                                                            • Summary of barriers to consumption
                                                                                              • Figure 47: Barriers to consumption, sugar and gum confectionery, November 2014
                                                                                            • Candy is perceived as “unhealthy” …
                                                                                              • Figure 48: Health-related barriers to consumption, sugar and gum confectionery, by gender, November 2014
                                                                                            • … and some consumers have other “issues” with candy
                                                                                              • Figure 49: “Personal issues” barriers to consumption, sugar and gum confectionery, by gender, November 2014
                                                                                            • Preference, availability also lead to defection from the category
                                                                                              • Figure 50: Preference and availability barriers to consumption, sugar and gum confectionery, by age, November 2014
                                                                                          • The Consumer – Attitudes towards Candy

                                                                                            • Key points
                                                                                              • Candy is an impulse treat
                                                                                                • Figure 51: Attitudes towards candy, November 2014
                                                                                              • Canadians are impulsive, but not so adventuresome
                                                                                                • Figure 52: Select attitudes towards sugar confectionery, by age, November 2014
                                                                                              • “Natural” is important for some candy eaters
                                                                                                • Figure 53: Select attitudes towards sugar confectionery, by age, November 2014
                                                                                            • The Consumer – Attitudes towards Gum

                                                                                              • Key points
                                                                                                • Gum’s breath freshening properties are valued
                                                                                                  • Figure 54: Attitudes towards gum, November 2014
                                                                                                • Parents are more likely to value of gum in regards to oral care
                                                                                                  • Figure 55: Select attitudes towards gum and oral care, by age, November 2014
                                                                                                • Other functional potential
                                                                                                  • Figure 56: Select attitudes towards gum and functionality, by age, November 2014
                                                                                                • Attitudes towards gum flavours
                                                                                                  • Figure 57: Select attitudes towards gum and flavours, by age, November 2014
                                                                                              • The Consumer – Sugar Confectionery and Chinese Canadians

                                                                                                • Key points
                                                                                                  • Chinese Canadians tend to be light confectionery consumers
                                                                                                    • Figure 58: Frequency of consumption of candy, gum, mints, Chinese Canadians vs overall population, November 2014
                                                                                                  • Chinese Canadians prioritize “real fruit” ingredients
                                                                                                    • Figure 59: Top reason for choosing one product over another, Chinese Canadians vs overall population, November 2014
                                                                                                  • Chinese Canadians have a high interest in healthier ingredients
                                                                                                    • Figure 60: Interest in new products, Chinese Canadians vs overall population, November 2014
                                                                                                  • Chinese Canadians are willing to experiment
                                                                                                    • Figure 61: Attitudes towards candy, Chinese Canadians vs overall population, November 2014
                                                                                                    • Figure 62: Attitudes towards gum, Chinese Canadians vs overall population, November 2014
                                                                                                • The Consumer – Target Groups

                                                                                                  • Key points
                                                                                                    • Four Target Groups
                                                                                                      • Figure 63: Target groups for sugar confectionary, November 2014
                                                                                                    • Health Conscious (26%)
                                                                                                      • Enthusiasts (26%)
                                                                                                        • Candy Adventurers (25%)
                                                                                                          • Pro Gum (23%)
                                                                                                          • Appendix – The Consumer – Trends in Usage

                                                                                                              • Figure 64: Frequency of consumption by type, November 2014
                                                                                                              • Figure 65: Frequency of consumption, by type, November 2014
                                                                                                              • Figure 66: Most popular frequency of consumption, by type – Any candy type, by demographics, November 2014
                                                                                                              • Figure 67: Next most popular frequency of consumption, by type – Any candy type, by demographics, November 2014
                                                                                                              • Figure 68: Frequency of consumption, by type – Hard candy, by demographics, November 2014
                                                                                                              • Figure 69: Frequency of consumption, by type – Chewy Candy, by demographics, November 2014
                                                                                                              • Figure 70: Most popular frequency of consumption, by type – Gum, by demographics, November 2014
                                                                                                              • Figure 71: Next most popular frequency of consumption, by type – Gum, by demographics, November 2014
                                                                                                              • Figure 72: Most popular frequency of consumption, by type – Chewing gum (eg Excel, Dentyne), by demographics, November 2014
                                                                                                              • Figure 73: Next most popular frequency of consumption, by type – Chewing gum (eg Excel, Dentyne), by demographics, November 2014
                                                                                                              • Figure 74: Most popular frequency of consumption, by type – Mints (eg Tic Tac, Altoids), by demographics, November 2014
                                                                                                              • Figure 75: Next most popular frequency of consumption, by type – Mints (eg Tic Tac, Altoids), by demographics, November 2014
                                                                                                              • Figure 76: Frequency of consumption, by type – Bubble gum (eg Bubbilicious, Hubba Bubba), by demographics, November 2014
                                                                                                              • Figure 77: Frequency of consumption, by type – Toffees and caramels (eg Mackintosh's, Werther's Original), by demographics, November 2014
                                                                                                              • Figure 78: Frequency of consumption, by type – Sugar-coated candy (eg Skittles, Jelly Beans), by demographics, November 2014
                                                                                                              • Figure 79: Frequency of consumption, by type – Licorice sweets (eg Twizzlers), by demographics, November 2014
                                                                                                              • Figure 80: Frequency of consumption, by type – Hard candy (eg Jolly Ranchers, Life Savers, lollipops), by demographics, November 2014
                                                                                                              • Figure 81: Frequency of consumption, by type – Jelly-style candy (eg Gummi Bears, Wine Gums, Sour Keys), by demographics, November 2014
                                                                                                              • Figure 82: Frequency of consumption, by type – Chews/Taffy (eg Starburst, Laffy Taffy), by demographics, November 2014
                                                                                                              • Figure 83: Frequency of consumption, by type – Any loose/bulk candy, by demographics, November 2014
                                                                                                              • Figure 84: Frequency of consumption, by type – Any other candy (eg Nerds), by demographics, November 2014
                                                                                                            • Repertoire Analysis
                                                                                                              • Figure 85: Repertoire of Frequency of consumption, by type, November 2014
                                                                                                              • Figure 86: Repertoire of frequency of consumption, by type, by demographics, November 2014
                                                                                                          • Appendix – Factors in Choosing Sugar and Gum Confectionery

                                                                                                              • Figure 87: Choice factors, November 2014
                                                                                                              • Figure 88: Most popular choice factors – Rank 1, by demographics, November 2014
                                                                                                              • Figure 89: Next most popular choice factors – Rank 1, by demographics, November 2014
                                                                                                              • Figure 90: Most popular choice factors – Rank 2, by demographics, November 2014
                                                                                                              • Figure 91: Next most popular choice factors – Rank 2, by demographics, November 2014
                                                                                                              • Figure 92: Most popular choice factors – Rank 3, by demographics, November 2014
                                                                                                              • Figure 93: Next most popular choice factors – Rank 3, by demographics, November 2014
                                                                                                              • Figure 94: Most popular choice factors – Rank 4, by demographics, November 2014
                                                                                                              • Figure 95: Next most popular choice factors – Rank 4, by demographics, November 2014
                                                                                                              • Figure 96: Most popular choice factors – Rank 5, by demographics, November 2014
                                                                                                              • Figure 97: Next most popular choice factors – Rank 5, by demographics, November 2014
                                                                                                          • Appendix – The Consumer – Interest in new products

                                                                                                              • Figure 98: Interest in new products, November 2014
                                                                                                              • Figure 99: Interest in new products – Dessert flavours (eg apple pie, strawberry cheesecake), by demographics, November 2014
                                                                                                              • Figure 100: Interest in new products – Causes sensations (eg heat, tingling feeling, popping), by demographics, November 2014
                                                                                                              • Figure 101: Interest in new products – Made with botanical extracts (eg lavender, green tea, hibiscus), by demographics, November 2014
                                                                                                              • Figure 102: Interest in new products – Flavours inspired by alcoholic drinks (eg mojito flavoured gum, cocktail inspired sweets)^, by demographics, November 2014
                                                                                                              • Figure 103: Interest in new products – Bags of mixed sweets (eg hard boiled sweets, fruit gums in the same bag), by demographics, November 2014
                                                                                                              • Figure 104: Interest in new products – Sweets which create new flavours if combined and eaten together, by demographics, November 2014
                                                                                                              • Figure 105: Interest in new products – Hand-made sweets, by demographics, November 2014
                                                                                                              • Figure 106: Interest in new products – Healthier sweets (ie made with only fruit juice and sweetened with honey/agave), by demographics, November 2014
                                                                                                              • Figure 107: Interest in new products – Natural sweeteners (eg stevia), by demographics, November 2014
                                                                                                              • Figure 108: Interest in new products – Unusual textures, by demographics, November 2014
                                                                                                              • Figure 109: Interest in new products – Added nutritional benefits (eg added fibre, vitamins), by demographics, November 2014
                                                                                                            • Influence of sweetener use on purchase of favourite sweet
                                                                                                              • Figure 110: Influence of sweetener use, November 2014
                                                                                                              • Figure 111: Influence of sweetener use, by demographics, November 2014
                                                                                                          • Appendix – The Consumer – Consumption Barriers

                                                                                                              • Figure 112: Barriers to consumption, November 2014
                                                                                                              • Figure 113: Most popular barriers to consumption, by demographics, November 2014
                                                                                                              • Figure 114: Next most popular barriers to consumption, by demographics, November 2014
                                                                                                          • Appendix – The Consumer – Attitudes toward Candy and Gum

                                                                                                              • Figure 115: Attitudes, November 2014
                                                                                                              • Figure 116: Agreement with the statements ‘I like to buy candy as an impulse treat’ and ‘It is worth paying more for sugar candy made with natural ingredients’, by demographics, November 2014
                                                                                                              • Figure 117: Agreement with the statements ‘I like to try new types of candy rather than sticking to the same types’ and ‘I am interested in candy which contains alternative sweeteners instead of sugar’, by demographics, November 2014
                                                                                                              • Figure 118: Agreement with the statements ‘My favourite types of candy are those which I ate as a child’ and ‘I like to look at the calorie information on the packaging of candy’, by demographics, November 2014
                                                                                                              • Figure 119: Agreement with the statements ‘Chewing gum helps me to snack less between meals’ and ‘I am interested in gum which changes flavour while chewing’, by demographics, November 2014
                                                                                                              • Figure 120: Agreement with the statements ‘I only like to chew mint-flavoured gum’ and ‘I would be interested in chewing gum with energy-boosting ingredients (eg caffeine)’, by demographics, November 2014
                                                                                                              • Figure 121: Agreement with the statements ‘Chewing gum is good for your teeth’ and ‘It is important to me to keep my breath fresh by chewing gum’, by demographics, November 2014
                                                                                                          • Appendix – The Consumer – Sugar Confectionery and Chinese Canadians

                                                                                                              • Figure 122: Selected demographics, by total population against Chinese Canadians, September 2014
                                                                                                          • Appendix – The Consumer – Target Groups

                                                                                                              • Figure 123: Target groups, November 2014
                                                                                                              • Figure 124: Target Groups, by demographics, November 2014
                                                                                                              • Figure 125: Frequency of consumption by type, by Target Groups, November 2014
                                                                                                              • Figure 126: Choice factors, by target groups, November 2014
                                                                                                              • Figure 127: Interest in new products, by target groups, November 2014
                                                                                                              • Figure 128: Influence of sweetener use, by target groups, November 2014
                                                                                                              • Figure 129: Barriers to consumption, by target groups, November 2014
                                                                                                              • Figure 130: Attitudes, by target groups, November 2014

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                                                                                                          Sugar Confectionery - Canada - January 2015

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