Chewing gum sales see post-pandemic bump
Dive Brief:
- Chewing gum sales bounced back in late spring as mask-wearing mandates lifted across much of the United States, according to data from NielsenIQ shared by Bloomberg. This revival comes after two consecutive years of declines for the 12 months ending in May.
- In the four weeks ending Feb. 27, gum dollar sales had dropped more than 30% from the same period a year ago, according to NielsenIQ figures. But by early April, sales growth had recovered to the point that it was almost flat. And by the four weeks ending May 1, gum sales leapt more than 23% from a year ago, although that growth rate has since moderated.
- The reversal in fortune for gum comes as the category overall has struggled under a longer-term slump in demand. For manufacturers such as Mondelēz International, Hershey and Mars Wrigley, maintaining consumers’ interest will be key to preventing a return to the downward trend after the novelty of mask-free life wanes.
Dive Insight:
For chewing gum, consumers’ renewed interest in breath freshening can provide an opportunity to reset the category after several years of sales declines. Judging by these early sales figures, the turnaround could have some legitimacy.
Despite inflationary trends, the bulk of the increase in gum dollar sales this past May was not due to price increases. Pack unit sales were up by nearly 15 million in May compared to January 2021, according to NielsenIQ figures. That said, prices per unit have also risen. Bloomberg noted that in May, the average retail price for a pack of gum was $2.11, compared to $2.05 at the beginning of January.
For Mondelēz, the timing of gum’s sales revival could be pivotal. At a Wall Street conference in early June, CFO Luca Zaramella noted the company was conducting a “strategic review” of its gum segment, including brands such as Trident and Dentyne. He said Mondelēz was focusing on returning its gum business to pre-pandemic levels before it decides to “potentially assess whether there are other avenues for us to create more value for Mondelēz shareholders.”
Later that month at the Jefferies Virtual Consumer Conference, Glen Walter, executive vice president and president for Mondelēz’s North America segment, said the company was focusing on three areas to position Trident for growth: messaging that emphasizes relief through chewing, execution at the store level and innovation. He pointed to a new, larger Pocket Pack multipack as an example of the latter. As consumers become increasingly mobile, the on-the-go packaging could be appealing. According to figures from Statista, Trident was the No. 2 sugarless gum brand in the U.S. in 2019, behind Mars Wrigley’s Extra.
“So the goal there is to get our footing back underneath us, get this stable, control the things that are in our control and make sure that as mobility increases, which we’re starting to see, we are in position to be a very, very strong choice for consumers,” he said.
Mars Wrigley is also banking on larger, car-friendly pack sizes to lead its innovation push. In a news conference this past November, Jim Dodge, vice president of convenience for Mars Wrigley Confectionery, cited the 30-piece Orbit Gum Mega Pack, which debuted in May, as a key innovation, and was especially optimistic about the potential for minty gum to lead in sales growth. “It’s going to bounce back,” Dodge said. “This category is extremely resilient.”
And Hershey CEO Michele Buck sounded similarly optimistic about the candy and snack giant’s Ice Breakers brand, telling analysts in a fourth-quarter 2020 earnings call that “gum will likely rebound” compared to 2020. However, it’s hard for gum sales not to improve upon last year. Sales of Hershey’s refreshment products — gum and mints — fell more than 20% in the fourth quarter of 2020.