Amidst a global pandemic, inflation, the stress of an election, an impending recession, and just generally disheartening times, it looks like there’s one unshakable comfort food people can’t live without. CNN reports that despite a number of challenges that would have caused a decline in sales for most products at its price point, chocolate continues to be a booming business.
Why chocolate sales stay strong
So, why chocolate? The simple answer is that people are stressed out. Chocolate is a comfort food and a resilient one. Starting with the pandemic, chocolate sales experienced a boost as many people turned to simple pleasures to get them through extensive periods of isolation, uncertainty, and boredom.
When lockdowns subsided and many returned to “normal” life, quarantine trends such as sourdough and grocery freezing became much less prevalent. Yet, chocolate maintained its place in our grocery carts, capitalizing on people’s need for something sweet to treat themselves, per a US Chocolate Confectionery Market Report 2022 from research firm Mintel.
Since then, both Hershey and global snack brand Mondelez (makers of Cadbury) have continued to see major increases in their chocolate sales. For the third quarter of this year Hershey reported a 12.6% increase in sales while Mondelez increased by 9.3%.
“Our products remain an affordable treat for families and for consumers,” said Hershey CEO Michele Buck during an analyst call, reports CNN. “We know that part of that is they want to reward themselves when times are tough. They also use these products to relieve stress. And we think that those trends will continue.”
Beyond the pandemic, many food products have seen increases in prices due to inflation that have led consumers to turn away from buying name brands. Yet consumers keep reaching for these chocolates for two major reasons: brand loyalty and a general lack of competition. Dan Sadler of market research firm IRI tells CNN that although prices have gone up, people are still looking for Hershey’s chocolate to complete their s’mores, rather than opting for alternative brands.
IRI also notes that only 2.7% of the U.S. chocolate retail market is made up of private labels, meaning that the remainder is dominated by mass-market brands like Hershey. This is not the case with other food categories like milk, where name brands comprise 62% of the market. That means that as our affinity for chocolate grows, the strength of the biggest players grows along with it.
From a business perspective, it looks like chocolate is all but indestructible in its profitability. Through a global pandemic, rising food prices, and some small but significant competition, people remain loyal to chocolate. It’s been here for us through it all, and we’re not letting it go any time soon. Make sure you’re buying the right stuff.