Healthy candy—sounds like an oxymoron, but thanks to innovators in the newly emerged better-for-you candy segment, candy is now fitting nicely into the health-conscious lifestyle.
“We know that the appetite for better-for-you [candy] is taking center stage,” said Michelle Villarroel, general manager of better-for-you, The Hershey Company. “With over 70% of people looking to reduce their sugar intake, we’re seeing sugar reduction and permissible indulgence options growing as a focus in the better-for-you candy industry.”
One out of six households buys sugar-free confections, according to IRI panel data, while about half of adults are looking for better-for-you options within the confection category, says Hershey.
Hershey’s answer to this consumer demand was a multipronged strategy to deliver better-for-you candy options to consumers, and the acquisition of candy company Lily’s was a major part of the plan. Lily’s products are sourced from non-GMO and gluten-free ingredients, and they contain no added sugar. Plus, the unsweetened chocolate, cocoa butter and vanilla used in most Lily’s products are certified fair trade by Fair Trade International.
The acquisition was a good call. Hershey’s better-for-you category grew by $52 million at retail in 2020, with Lily’s driving 41% of that growth, according to Hershey. Driving that growth was Lily’s gummy bears and sour gummy worms, as well as chocolate bars with peanut-butter, caramel and hazelnut-butter fillings. Hershey says Lily’s will be introducing candy-coated pieces in dark chocolate and milk chocolate with peanuts this year.
INDULGENT AND NICE
Can candy products that are indulgent still be better for you? Gigantic LLC thinks so. Gigantic is a better-for-you candy bar company that launched in January 2021 on the premise that candy can be fun and delicious without excessive sugar, over-the-top sweetness or shifty ingredients.
“We rebuilt the candy bar from the ground up, focusing on all-natural, exclusively plant-based ingredients, a lot less sugar and a more moderate sweetness level that we call ‘sortasweet,’” said Stu Davidoff, founder, Gigantic.
A big focus for Gigantic is responsible ingredient sources. The candy bars are made with fair trade, organic dark chocolate, and the company developed a new type of caramel made from plant-based ingredients including tapioca, coconut milk and almond butter.
All Gigantic bars are dairy and gluten free, and each bar has seven grams of sugar and does not contain artificial or alternative sweeteners like erythritol, stevia or monk-fruit. Flavors include salted peanut, almond horchata, hazelnut café and banana pecan.
“The result is an ingredient panel that a health-conscious adult can approve, but with a delicious, indulgent experience that fully delivers the old-school candy bar rush,” said Davidoff.
Reaching the health-conscious adult or the adult reentering the candy category is the demographic many better-for-you candy companies aim to reach, but there is a trickle-down effect.
BEHAVE is a better-for-you candy company launched in August 2020 offering sour gummies and sweet gummies made with low sugar and all-natural ingredients without sugar alcohols or artificial sweeteners, colors or flavors. Though its target audience is millennials and older Gen Zs, BEHAVE finds that its customers are buying BEHAVE candies not only for themselves but also for their kids.
“[Our customers are] talking about having that experience, [saying] ‘finally a candy that I can feed my kids and not feel badly about it or one that I can have at my kid’s birthday party or that I can send my kids to school with,’” said Mayssa Chehata, founder of BEHAVE.
Because BEHAVE’s candies only have one gram of sugar, older generations are reaching for BEHAVE as well, but the company’s ultimate aim is the millennial consumer.
We really try to stay away from anything that feels like diet messaging or is centered around food restriction or even sugar restriction.
We do solve a problem for an older demographic, but we felt that speaking to that millennial consumer ultimately helps us touch a lot of different age groups and demographics,” said Chehata.
Gigantic says its candy bars are “a hit” with kids. “A lot of Gen Z and Gen Alpha don’t habitually consume supersweet sodas and candies like their parents did because they find a lot of those products too sweet and actually prefer the ‘sortasweet’ level of Gigantic,” said Davidoff. Gigantic’s largest e-commerce customers are families with kids, so everyone in the family is enjoying the candy, says the company.
LOSE THE GUILT
A recent report from the National Confectioners Association found that 78% of candy consumers say it’s “perfectly fine” to occasionally treat themselves with chocolate or candy, and 72% of consumers believe physical health and emotional well-being are interconnected.
The emotional aspect surrounding candy is something that BEHAVE’s Chehata wanted to address with her products. BEHAVE already offers healthier candy with low sugar, high fiber and quality ingredients, and the company could have stopped there, but Chehata wanted to have an impact on the mental health of better-for-you candy consumers.
“We did not want to enter the candy category and take a position of shame, prescribe guilt or tell people that they shouldn’t be eating regular candy,” said Chehata.
A ticker on BEHAVE’s website displays positive messages such as, “Say yes to binging all 18 episodes ... actually tasty healthy options ... adding guac every time. And no to a salad when you want fries ... artificial food (or friends) ... ignoring your sweet tooth.”
“We do live in this better-for-you category within candy, but with our brand and a lot of our messaging and marketing, we really try to stay away from anything that feels like diet messaging or is centered around food restriction or even sugar restriction,” said Chehata. “[We say] you can finish the whole bag, you can grab two bags, eat as much as you want,” she said.
BEHAVE’s bag sizes are 50 grams, which is a smaller serving size than a bag of traditional candy, according to Chehata, but the company consistently hears from its customers that they are satiated after finishing a bag. That could be due to the high fiber content in BEHAVE candy because it uses plant fibers as a sugar alternative. BEHAVE candy ranges from 13 to 14 grams of fiber per serving.
A lot of Gen Z and Gen Alpha don’t habitually consume supersweet sodas and candies like their parents did because they find a lot of products to be too sweet.
COST OF GOODS
Although better-for-you candy can allow consumers to fit candy into a healthy lifestyle, it comes at a cost. Gigantic’s candy bars are $27.99 for a pack of eight bars, and BEHAVE’s gummies are priced at $30 for a six-pack box. Lily’s gummy candy offerings are roughly half the price of BEHAVE’s at $2.78 for a 51-gram bag, but its filled-chocolate bars are $3.48 each, roughly the same as Gigantic’s.
BEHAVE and Gigantic offer a monthly subscription option. BEHAVE customers can receive 10% off a monthly subscription, and Gigantic offers a 15% discount for monthly subscriptions.
“It’s a convenient way for loyal Gigantic customers to stay stocked via automatic deliveries at a discount to regular retail prices. A good percentage of repeat customers opt for subscription,” said Davidoff.
BEING A KID AGAIN
The marketing industry often utilizes nostalgia to sell products because it’s a powerful tactic, and the better-for-you candy industry is no exception.
“We’re seeing imitations of more traditional and nostalgic candy forms, like gummy worms, chocolate-filled bars, lollipops and peanut butter cups,” said Emily Schildt, founder, Pop Up Grocer, a pop-up grocery company, which has opened seven sites across the country, focusing on mission-driven and better-for-you brands.
Nostalgia is the foundation of Gigantic. Davidoff said he was a “candy bar kid,” and he became more health conscious as an adult, but he was still missing that rush of excite- ment he’d get from a classic candy bar.
“We see a special amount of enthusiasm from our initial target market of consumers who had previously left the candy bar category,” said Davidoff. “For those health-conscious adults, [we offer] a permission slip to eat candy bars again.”
Better-for-you candy companies know the value seasonal candy brings to both consumers and their bottom lines. Convenience stores saw $183 million in seasonal candy sales in 2020, according to Statista.
Gigantic launched two seasonal flavors last year—Smashing Pumpkin in the fall and Double Dark Mint in the winter.
“The limited-edition flavors are a fun way for our fans to enjoy the change of seasons with their favorite candy bar,” said Davidoff.
Hershey’s Lily’s brand also offers Peppermint White Chocolate and Mocha Hot Cocoa Extra Dark Chocolate bars during the holiday season.
Divine Chocolate, a fair trade and b-corporate brand co-owned by farmers, offers Easter items, such as milk and dark chocolate mini eggs, as well as Easter and Mother’s Day gift sets, which also are available with vegan chocolates.