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Customers Tell Retailers, ‘I Want Candy’

April 24, 2008

6 Min Read
Customers Tell Retailers, ‘I Want Candy’

Despite concerns about calories and cavities, few people can resist the lure of sweets. And while the natural foods industry has not yet invented a magic formula to make the consumption of confections a completely healthy and low-calorie affair, the growing trend toward organic candy is a step in the right direction.

Organic candies are big sellers in the natural foods industry. With more than $11 million in sales in the past year—a 25.5 percent increase—organic candy is proving enticing to consumers. There are many reasons for the robust sales.

Organic candy clearly is healthier in many ways. Organic standards assure consumers that the candy they?re eating is free of pesticide and chemical fertilizer residues. And in the candy industry, the concept of ?organic? is usually wedded to gourmet, high-quality food ingredients.

According to David Browne, director of operations for SPINS, the San Francisco-based natural foods market research firm, candies that combine top-quality ingredients with organic standards are the fastest-growing segment of the market. ?The best-selling and fastest-growing organic candies are doing a good job of balancing the marketing of their products, not only as certified organic, but also as the best of the best,? Browne says. ?They are presenting a product that is high-quality through and through, and expect that the taste will knock consumers out.?

Another factor that differentiates some organic candies from mainstream varieties is the concept of fair trade. For chocolate to be certified as fair trade, cocoa farmers and producers must be paid a fair, established price for their products; the producers must belong to cooperatives or other democratic associations; importers must agree to buy directly from fair trade-certified producers and agree to establish long-term relationships; and producers must implement environmental protection plans. Thus, when you buy from companies that are certified by TransFair USA, the only independent, third-party certifier of fair-trade practices in the United States, you can be assured you?re buying products that provide the farmers a living wage and that are grown using farming practices that are environmentally responsible.

Dagoba?s Chocolate founder Frederick Schilling says being a good environmental citizen goes hand in hand with good sales. ?While the organic chocolate industry is still very small, I do believe there will be continued growth as more retailers and consumers lean toward supporting organic chocolate and rainforest [and] Third World commodities.? Schilling says that once consumers understand how purchasing organic chocolate supports rain-forest biodiversity, they?ll be inclined to buy even more.

Dagoba?s line of organic chocolate products includes bulk chocolate, chocolate bars, chocolate powders and hot chocolates for retail; and organic chocolate syrup for foodservice. A number of Dagoba?s products are fair-trade-certified, including its cacao powder, hot chocolate, chocodrops, chocolate syrup and single-bean-origin chocolate bar, Concado.

Schilling enthusiastically points out that organic chocolates offer plenty of health benefits as well. ?In my religion, chocolate is not a candy, but a food,? he says. ?Cacao is one of the best vasodilators, opening up our blood vessels and cells to allow more oxygen into our system, giving us more energy. This is why it?s such a good energy food. According to the [U.S. Department of Agriculture], cacao has the highest ORAC [oxygen radical absorption capacity] level of all tested fruit or vegetables, meaning it has the highest antioxidant level. It is second only to seaweed in magnesium content and has good fiber, protein and iron contents as well.?

Other organic candy lines, such as those made by SunRidge Farms (one of the biggest suppliers to natural foods stores of bulk and packaged candies) make other health claims as well. Morty Cohen, president and owner of the Santa Cruz, Calif.-based company, says the health benefits of SunRidge Farms? candy come just as much from what is left out as what is put in: ?Our candies provide an alternative to the voluminous ?junk candies? permeating our society,? Cohen explains. ?Our organic candies contain no hydrogenated oils, sulfur dioxide, animal-based gelatin, titanium dioxide dye, or artificial colorings, flavorings or additives.?

A safer sweet tooth
Even with its 25.5 percent growth, the organic candy industry is still slightly behind the conventional candy category, which grew 28 percent last year. ?This in itself is interesting, as typically with many food and beverage categories, the organic segments outpace the category as a whole,? SPINS? Browne says. ?This suggests that organics in the past year are not as significant a driver to candy consumers as other considerations, such as candy type, quality, price, etc. General awareness for organics continues to grow, but taste is a primary driver.?

Nevertheless, Browne says that some segments of the organic market will only continue to expand. ?Chocolate, by far, is the largest and fastest-growing segment,? he notes. ?The most significant increases in sales are coming from gourmet, high-quality chocolates, many of which contain high percentages of cocoa. The British company Green & Black?s, as well as Terra Nostra Organics [of Vancouver, British Columbia] are just doing phenomenally well.?

Browne says the organic candy industry as a whole should be able to sustain its high rate of growth for at least the next year or two. ?A few years ago you would see organic candy in natural supermarkets only,? he says. ?Now we are seeing organic companies like Newman?s Own Organics or Dagoba chocolates in mainstream candy sets. Organic candy is also promoted very well at Trader Joe?s. Going forward, I think there?s a lot of opportunity for expanded distribution and for more players to enter the market as well.?

Organic chocolate maker Mrs. Mudd?s in Oceanside, Calif., echoes this trend, having seen exceptional growth in the past year. ?In the last year we have seen upwards of 400 percent in sales growth, and we can confidently estimate growth of an additional 1,000 percent in the coming year,? says Gabe Galvez, sales and marketing director for the company.

SunRidge Farms? Cohen attributes the growth he?s seen in the market, and in his company, to improvements in the quality and taste of new and existing organic products, as well as innovative products coming into the marketplace. ?We?ve also found a strong receptivity to organic kid-appeal candies, such as organic Sunny Bears, organic Sour Sunny Bears and organic Jolly Beans,? he says. Cohen also notes that the supply of raw materials has expanded, allowing SunRidge to bring down the pricing on a number of organic confections.

But Browne says consumers still are willing to pay a premium for organic candy and high quality. ?Customers who routinely shop natural products supermarkets and gourmet retail outlets recognize and choose high-quality foods despite the higher price tag,? he says. ?And for the most part, organic candy products tend to taste very good, and product packaging emphasizes gourmet, high-end quality, versus a natural, hippy-dippy feel.?

Lynn Ginsburg is a free-lance writer based in Boulder, Colo., and co-author of What Are You Hungry For? Women, Food and Spirituality (St. Martin?s Press, 2002). For more information, check out

Natural Foods Merchandiser volume XXV/number 3/p. 85

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