As traditional convenience store sales have been challenged by the coronavirus pandemic, Mars Wrigley has found a sweet spot with the online consumer, helping to fill baskets, add impulse buys and playing up moments in which consumers want to indulge.
Despite a mixed bag of challenges and successes in convenience stores in general this year, Mars Wrigley is in growth mode in the channel, Jim Dodge, vice president of convenience for Mars Wrigley Confectionery, said at an online press conference. In convenience as a whole for 2020 through Oct. 31, the company's sales are up 2%. Looking into categories, chocolate sales have increased 5.3% and fruity confections are up 10.1%
"[This] speaks to the resiliency of this category and the fact that consumers love to treat themselves with brands that they trust," he said.
While many at Mars Wrigley expressed hope the pandemic will end soon and both businesses and consumers can return to less socially distanced lifestyles, the company has been doubling down on digital programs and promotions. And the innovations also keep coming, with new products, packaging and flavor varieties to draw more consumers to the confectioner's products. Next year, consumers will find new products including Skittles Gummies, M&Ms Mixes featuring different varieties in a single bag and larger size packs of Orbit Gum on shelves.
The consumer is key, and Mars Wrigley's strategies have been helping keep conversion rates high — even in a retail channel and food category dominated by impulse buys, officials said at the press conference, which was a virtual representation of what Mars Wrigley would have presented at the National Association of Convenience Stores' NACS Show last month.
"Out of adversity, opportunity is born and presents itself, so I think this is a true opportunity for both manufacturers and our convenience partners to reinvent themselves," Dodge said. "What was nice-to-dos and on PowerPoint slides are now must-dos."
Building virtual shelves and baskets
Developing creative ways to adapt to the current realities has paid off so far for Mars Wrigley.
For Halloween, the confectioner developed Treat Town, a virtual trick-or-treating app through which participants could collect credits redeemable for real treats at real retailers. Mike Gilroy, vice president of trade development and sponsorship for Mars Wrigley, said company leadership praised this app as a great example of the company's digital transformation.
"What we wanted to do was learn," Gilroy said. "We wanted to test and learn, test and learn to build muscle with an entrepreneurship mindset, and so ultimately creating that ecosystem for Mars Wrigley for an online opportunity."
Treat Town was the second most downloaded app in the food and beverage category in October, Gilroy said. The Treat Town app also got one and a half times the impressions than advertising during the Super Bowl — when more than 190 million people watch the game.
But retailers still need to drive traffic, and what truly makes a store convenient for consumers has changed during the COVID-19 pandemic.
C-stores, which long drew shoppers with their physical locations, have had to adapt to many consumers not wanting to leave their homes. The pandemic has done quite a lot to push the convenience channel — and the products sold there — online. Some chains, including 7-Eleven and Wawa, have built robust delivery partnerships. Others have embraced other solutions. According to a NACS survey, 21% of stores have added curbside pickup, while the same percentage has added contactless payment. And 14% have focused on drive-thru.
Hallie Barish, c-store category leader for Mars Wrigley, said that the coronavirus has catapulted the channel into digital. What's worked, she said, is being able to serve consumers where they are. Digital platforms are great, she said, but c-stores need to concentrate on building traffic and driving conversion in order to succeed. Despite the way consumers are shopping now, Barish added that they are still looking for a snack or treat, and retailers need to be able to use imagery, the right package size and the best price to draw shoppers' attention to add it to their cart. Online shoppers today are looking more for value than anything else, she said.
"Out of adversity, opportunity is born and presents itself, so I think this is a true opportunity for both manufacturers and our convenience partners to reinvent themselves. What was nice-to-dos and on PowerPoint slides are now must-dos."
Vice president of convenience, Mars Wrigley Confectionery
"As you think about the in-store experience, having the right assortment, making it easy to navigate and using visual imagery are absolutely critical," Barish said. "We know that top barriers to purchasing confectionery online is that it's both confusing and frustrating to shop. In the window to capture shoppers' attention, it's less than two seconds. So having the right visuals can literally make or break a sale."
Even after the pandemic ends, Barish said she doesn't think stores will see the same amount of foot traffic they once did.
"We anticipate every retailer's going to continue their efforts to build trust, build loyalty with their customers, as they serve them both in-store and continue to extend their delivery and pickup platforms," she said.
Success in 2021 and beyond
While retail strategy is important to drive sales, so are innovative products. Dodge said the pandemic is helping drive sales for brands that consumers trust, and Mars Wrigley has many treats in its portfolio that have been enjoyed for generations.
Gummies have been the true shining star of c-store confectionery, he said, and Mars Wrigley is planning to extend its leadership in the category. Skittles, which the company said is the top fruity candy brand, will be getting its own gummy next year.
"This is going to be a home run," Dodge said. "...We presented to one of our largest retailer partners. And the quote back was, 'I didn't think there was anything better than sliced bread until today.' So they're excited. We're excited."
Skittles Gummies, which will be available in both Original and Wild Berry varieties, will be in small peg bag and stand-up pack sizes. Dodge said it will be supported with $12 million in advertising.
Other innovations are adding new varieties to old favorites. Next month, a new Snickers Peanut Brownie bar, featuring a fudge brownie filling, will be arriving on store shelves. In April and May, bags of different varieties of M&Ms, called M&Ms Mix, will be getting to consumers. And a new Orbit Gum Mega Pack, featuring a hard plastic package with 30 pieces gum inside in multiple rows, grandstand-style, will also be hitting stores in April.
Dodge said that even though the mint gum category has seen sales drop during the pandemic, Mars Wrigley is confident it will come roaring back in 2021. Mint gum is a product mostly used for people when they leave the home, which there hasn't been much of recently.
"It's going to bounce back," he said. "This category is extremely resilient. What are we doing about this? We are going all in on advertising in the fourth quarter. So when consumers come back, gum will be top of mind, and they will engage in the category."