The yellow M&M dressed like Darth Vader was a turning point for dark chocolate.
In spring 2005, M&M's candies introduced a dark chocolate version of its iconic candy in time for the release of "Star Wars: Episode III, Revenge of the Sith." The promotion with the most anticipated movie of the year showed that dark chocolate had gone mainstream in a big way. And over the past year and a half, it's only gotten bigger.
"We have seen an explosion of items in the last two years," said Randy Deschaine, director of Center Store for Sweetbay Supermarkets in Tampa, Fla. He said his stores have increased their dark chocolate selections and that management is "currently working on a variety of cross-merchandising [plans]," though he wouldn't provide specifics.
Retailers continue to take full advantage of dark chocolate's association with health and gourmet food by cross-merchandising it with everything from baked goods to wine, and by extolling its nutritional virtues.
At Chandler, Ariz.-based AJ's Fine Foods, associates are trained to suggest red and dessert wines that go with dark chocolate. The retailer uses signs to encourage candy aisle shoppers to check out its bakery, where dark chocolate is used in pastries.
"We're using it because of all the wonderful things it offers," said Kathleen Snyder-Couch, Boulangerie manager at one of AJ's 11 locations. "It's a mood elevator. Basically, if you're having a bad day, eat some dark chocolate; it's going to calm you down and make you feel a whole lot better. It increases your serotonin, a natural chemical in your body that helps you calm down under stressful conditions."
Cocoa lovers have long been drawn to dark chocolate for those good feelings it inspires.
More recently, research has shown it to be high
in antioxidants - compounds that help neutralize free radicals and protect the body against their destructive effects. Data indicate that dark chocolate is one of the most concentrated sources of flavanol antioxidants among plant foods. The antioxidant capacity of one serving of Hershey's Extra Dark chocolate (37g), according to Hershey, is equal to three cups of tea, two glasses of red wine or 1-1/3 cups of blueberries.
Flavanol-rich cocoa also has been found to benefit circulatory health by improving brain and cardiovascular blood-flow. A pair of independent studies reportedly demonstrated that eating flavanol-rich cocoa can increase blood flow to the brain, according to the Journal of Cardiovascular Pharmacology. Scientists found that the regular consumption of flavanol-rich cocoa resulted in a significant increase in blood flow in hypercholesterolemic postmenopausal women, suggesting that this cocoa may improve vascular function in this population with higher cardiovascular risk. Another finding: cocoa flavanols may have beneficial effects on platelets; and that certain flavanols, and flavanol-rich cocoa itself, may also reduce the events that can lead to vascular damage.
SALES ARE UP
Marketers are introducing many products with higher cocoa content to meet increased consumer demand for dark chocolate. High cocoa content has become a key selling point on packaging, Packaged Facts, publishing division of MarketResearch.com, stated in a report. Overall, so-called gourmet chocolate accounts for roughly 10% of chocolate sales and is growing faster than the overall chocolate market. Packaged Facts estimated total gourmet chocolate sales would reach $1.8 billion in 2010 from $1.3 billion in 2005, a compound annual growth rate of 6.4%.
"Just about every mainstream manufacturer has entered the segment in some shape or form," said Rob Thatford, director of direct store delivery, nonfoods and candy for East Coast distributor Bozzuto's, adding that specialty manufacturers already making dark chocolate have also expanded their selections.
Because it's geared toward adults, the segment carries the potential for incremental sales.
MARKETING STRATEGIES
"Chains are starting to promote the dark segment to pick up that incremental sale among adult shoppers," Thatford said. "They are still buying candy for the kids, but now there is a segment geared more toward them. This segment is geared more for adults as an indulgence rather than just a sugar high or craving."
Other characteristics promote dark chocolate's adult appeal. Higher-end dark chocolates are embracing the portion control aspect to tell consumers they can enjoy a treat without guilt, Thatford said. "Dark chocolate is also better for you than sweet chocolate. It has less sugar than the average candy bar. Adults do take notice of this. The higher the actual cocoa content, the better it is for you."
That's not to say manufacturers are ignoring kid consumers. Ice cream makers have introduced items highlighting the use of dark chocolate. "There are also several indulgent novelties with dark chocolate," Thatford said. "Again, this can promote multiple purchases from shoppers in buying items for the kids and for themselves."
Dark chocolate's association with health and high-end indulgence gives it many merchandising possibilities.
Thatford sees "tremendous" opportunities to cross-merchandise dark chocolate with wines and cheeses. "Most manufacturers are launching items with fruit and nut inclusions in the dark chocolate," he said. "Raspberry, yogurt and toffee are a few examples of this."
Most retailers will get involved in advertising and displaying dark chocolate as the holiday season starts, he said. "Wine stores and specialty food stores will increase perimeter cross-merchandising with dark chocolates as well, to help increase total store margins."
Giant Eagle, Pittsburgh, has added dark chocolate items with various fruits and nuts, candy category manager Tim Tackett said. Stores promote dark chocolate and display products throughout the store in shippers. The chain's Ohio supermarkets have used shippers in the wine departments.
"We have not directly promoted the health benefits of dark chocolates, but both the media and manufacturers have done a great deal to get this message across," Tackett said. "We find that those consumers coming in to purchase dark chocolates already understand the benefits of flavanols."
RAISING THE BAR
Although promotions tend to center around holiday candy, Price Chopper, Schenectady, N.Y., has increased its dark chocolate offerings from Hershey, Dove, Lindt and Ghirardelli in the candy section and increased promotions, said Mona Golub, spokesperson for the retailer.
"People are leaning toward purchasing a dark chocolate product instead of a milk chocolate product. You want to make sure that you've covered the base - wherever there is a base to be covered."
Retailers like dark chocolate because it can drive incremental sales of candy bars in the candy aisle and as an ingredient, spur sales in other categories. It also can help them gain share at the expense of specialty retailers.
"It's challenging to have the increased assortment that is necessary to take advantage of new items," said Jeff Lowrance, spokesman for Food Lion, Salisbury, N.C. "Typically, specialty stores have a lot of items with relatively low turns. Our objective is to maximize turns while maximizing our assortment."
Dark chocolate's use in products like cookies and ice cream can also help build mainstream sales, he said.
