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Sweets, Snacks and Three Takeaways from ISM 2020

2/17/2020
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ISM 2020, now celebrating its 50th anniversary, is a large trade fair in Cologne, Germany for packaged sweets and snacks manufacturers to showcase new flavours, launch new products, and connect with distributors. Product manufacturers come from around the world to tap into the relatively mature, but increasingly dynamic, European market.

After endless sampling (and lots of sugar), attending expert presentations, chatting with exhibitors and through general observations; it was clear that labelling, fresh packaging and branding, sustainability and storytelling emerged as the most important ways brands were able to differentiate themselves. In a crowded operating environment where consumers have more choices than ever, differentiation in any way is crucial for both loyalty and generating sales.

Labelling is more important – and more specific – than ever

Labelling is important in packaged foods. Labelling helps the consumer understand, often through symbolism, more about the product and connect to it in a more meaningful way. But the way brands use labels is changing. Labels such as “natural” were once highly prevalent in the industry but were seen a lot less this year. This could be because consumers are more aware of labels and what they mean. Labels like “natural” can be vague, and consumers increasingly see them as superficial attempts to appear healthier or premium without having any real impact on the product or what it contains.

Instead, labels are becoming more specific, targeting consumers with specific dietary needs or personal preferences. Familiar labels like organic, gluten-free, no fat added, fair trade and vegan were quite prevalent across the show, but some less common labels were noticed as well, including Halal certified, caffeine added, CO2 neutral, and ‘without palm oil’. Many brands embraced multiple labels. Max’s Organic Mints for example, touted seven different symbols on its packaging including “allergen-free” and “sheltered employment”. Consumers’ preferences are fracturing, and so are their options, and a new brand with the right labels might resonate particularly well with a specific consumer segment.

Retro styles and new brands reinvigorate the chocolate bar

Two new brands stood out at the show this year, both in terms of their large flashy exhibition booths and the buzz they generated around the trade fairgrounds. Both, intriguingly, embraced similar retro looks and styling, and both compete in a highly established category, the standard chocolate bar. One brand was called Chocjes, a new vegan chocolate bar from Katjes, an established confectionery producer in Germany, that uses oat milk in place of cow’s milk in its chocolate production. Chocjes was launched in the German market in 2019, and was the key focus of Katje’s booth at ISM.

The other player making a big push was Netherlands-based, Tony’s. Tony’s is available in the Dutch market, and they maintain some early partnerships with retailers in the US, UK and in the German-speaking DACH countries where Tony’s can be found at Rewe and Edeka, as well as some independent grocers. Tony’s closely links the brand to its slavery-free supply chain of cocoa farms in West Africa.

While both brands take a unique approach to a very traditional product, from a marketing perspective, they felt very similar. Embracing large paper-based wrapping in a variety of bright colours, with fonts that might be reminiscent of the 1960s or 70s, a distinctly retro approach. This helps make both brands stand out to the consumer, a fresh approach to a very established category and a general departure from the premiumisation of packaging that chocolate bars have taken in past years.

Sustainability is key, but so is a good story

Like its branding, Tony’s stands out in another way. Tony’s heavily links its message of corporate responsibility, specifically in the company’s slavery-free supply chain, with its brand. As a new player, a consumer discovering the company for the first time might associate this message with the brand as much as the chocolate product itself. Tony’s uses the inner part of its paper wrapping to discuss the details of its supply chain. Other brands, especially in chocolate, have taken similar approaches this year, developing a story associated with the brand that can resonate with the consumer, often using packaging in unique ways to tell that story.

Sustainability in its broadest form is an important consumer trend in Germany and elsewhere. This may include environmental sustainability, and indeed more brands claimed to be carbon neutral at the show this year. The winner of the New Product Development Award for Packaging for example, went to a German company called Froben Druck, which produces eco-friendly packaging made from grass. Sustainability may also include social responsibility and fair-trade practices, as seen in Tony’s slavery-free supply chain, or it might be related to diet, as more consumers choose to eat meat less often, or lead vegetarian or vegan lifestyles.

Sustainable messaging resonates increasingly well with consumers, and those brands that do it well stand out. Given the breadth of brands and products competing with one another for consumer attention, these points of differentiation, whether through labels, branding or messaging, can have an important impact on sales.

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