Industry Insights
The global confectionery market size was estimated at USD 199.9 billion in 2017. It is projected to reach USD 284.4 billion by 2025. Increasing focus on product innovation is anticipated to help the market gain traction over the coming years. Market players are increasingly introducing new flavors and ingredients in their products to retain interest of their consumers. Moreover, decreasing cocoa prices will help chocolate manufacturers to earn higher profit margin. Changing consumer consumption patterns have promoted distribution channels such as e-commerce websites, which in turn has worked in favor of the industry.
Global confectionery market size, by distribution channel, 2015 - 2025 (USD Billion)
Segmentation by Product
• Chocolate confectionery
• Sugar confectionery
• Gum
The chocolate segment was valued at USD 128.7 billion in 2017 and accounted for the largest share in the market. It is anticipated to reach market size of USD 174.8 billion by 2025, expanding at a CAGR of 4.4% during the forecast period. Introduction of dark, organic, and alcohol flavored chocolates is expected to boost the growth of the segment. Surging demand for chocolate bars with exotic nuts and fruits, high protein, and low sugar content is likely to foster the growth of the market.
However, the gum segment is estimated to register the highest CAGR of 5.5% over the same period. The growth of the segment can be attributed to availability of chewing gums with medicinal qualities that help in avoiding cavity and bad breath coupled with growing demand for sugar-free product. Moreover, consuming them is considered as a good exercise for strengthening facial muscles and shaping jaws, which is translating into greater demand for gums.
Sugar confectionaries are also slated to witness considerable growth during the forecast period due to increasing innovation in these products. Furthermore, growing efforts by market players to extend their product portfolio through new product development is poised to stimulate the growth of the industry.
Segmentation by Distribution Channel
• Hypermarket & supermarkets
• Drug stores
• Specialty stores
• Others
The hypermarkets and supermarkets segment dominated the confectionery market. It was valued at USD 127.5 billion in 2017. It is likely to post a CAGR of 4.7% during the forecast period. Higher availability of variants in such locations is contributing to the growth of the segment. These stores offer a large space and witness high footfall as compared to other stores. Therefore, it is poised to retain its position in the market until 2025.
Segmentation by region
• North America
• Europe
• Asia Pacific
• Latin America
• MEA
Europe was the leading revenue contributor in the global market, accounting for more than 35.0% share in 2017. It is expected to progress at a CAGR of around 3.7% during the forecast period. In Germany, the market accounted for over 7.5% share of the overall food and beverages industry. The average per capita consumption of confectionaries exceeds to about 30 kg in the country. High consumption in Germany has been supporting the growth of the market in Europe.
Asia Pacific is the fastest growing region in the global arena, exhibiting a CAGR of around 7.3% during the same period. The regional market holds a significant share of approximately 25.0% in 2017. Advancements in the food grocery industry of countries such as Japan, China, and India are leading to increased availability of products such as Dry Food Grocery, spices, dairy, perishable, and fresh produce.
Competitive Landscape
Confectionery manufacturers such as Hershey Company; Nestle SA; Mondelez International, Inc.; and Mars, Inc. procure and utilize large quantities of commodities such as cocoa, dairy products, soybean and vegetable oils, sugar and other sweeteners. Moreover, they ensure uninterrupted supply of packaging materials, along with electricity, natural gas, and other fuels for their factories and warehouses. Protean prices of principal raw materials can be a challenge for market players. However, market players have been applying hedging techniques to reduce the impact of price fluctuations on principle raw materials.
They are continuously striving to introduce new improvements, focused on consumer demand and industry trends, to existing products. In current scenario, healthy snacks and wellness products are the key areas of focus of R&D team. Market players usually sell products to superstores, distributors, club stores, wholesalers, and convenience store, among other retail outlets. They distribute their products directly via distribution centers, store delivery, company-owned and satellite warehouses, among other facilities. In addition, they utilize services offered by independent sales offices and agents present at international locations.
