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bag confectionery and chocolate, and box chocolate, in picnic style sharing occasions. From a shopping vantage point, the return of the weekly stock-up shop means less footfall and fewer shoppers at the checkout in a category reliant on impulse sales. In the lead-up to Christmas 2020, for instance, nearly half of chocolate gifts were unplanned purchases, with an aisle avoidance rate of around 40 per cent. This places more emphasis not only at checkout but also on off-location displays. The shift to online during lockdowns has also negatively impacted impulse purchases, so online promotional programs need to be shored up. This means you should be clear on whether your promotional objectives are to address driving revenue and transaction value in online baskets, and to what extent your online pricing tactics differ from your offline promotional program. Is your cost to compete or promotional intensity for your brands within the key segments you play being optimised? What is your true baseline, and are you winning your share of profitable promotional volume? Implications for revenue management strategy So, the name of the game from a volume perspective is getting the confectionery category into shopper baskets. In other words, basket penetration. This will require a combination of price, promotion and display adjustments and may require sacrificing some AWOP activity such as multibuys for the good of the greater goal. Aisle promotions planning, particularly on core SKUs, may require greater depth. We’re already seeing deep discounts on Lindt blocks for instance. As mentioned, pricing tactics need to link back to your overarching objective and agenda to drive the category and maximise shopper value. Deep discounts may be the right strategy as long as they’re part of a brand and pack strategy that enables margin management and planning on where to accelerate or reduce investment. Promotions should look to tie down off-location displays in as much of the program as possible given aisle avoidance rates. Displays need to be tied to an occasion for relevance. Easter, a natural chocolate occasion, is obvious, but other occasions include leveraging outdoor events, being an alternative to popcorn for Netflix evenings on the couch, or even new occasions and partnered promotions such as a ‘treat with coffee’ (coffee at-home consumption increased hugely in 2020, including purchase of coffee machines, ensuring elevated levels of at-home coffee consumption through 2021). At the checkout, the role of confectionery is typically one of treat or reward for having completed the grocery shopping trip. Shoppers do rough calculations about cost of treat versus cost of basket and time spent on the shop (and to what extent the grocery shopping trip is a chore). So typically, sub-$2 price points at checkout work. Promotional programs may include drops to $1 and $1.50, for instance. Optimising price here means understanding competition pricing, and whether the retailer category profitability norms are still relevant. How are all the brands working in the category to support the retailer’s growth objectives, and provide fair share choice to the shopper, without rebasing price points to unsustainable levels? positioning by continually monitoring and reacting to channel shifts. • Continuous tracking of consumers and their changes in how, what and when they buy. • Mapping products and packs to specific, differing occasions, missions and price points. • Portfolio management, involving end-to-end value chain assessment across the portfolio; seeking opportunities to premiumise through adjustments to price and weight; and launching into higher price tiers via additional product benefits or larger pack sizes, premium innovation, and mix management to accelerate higher value lines. While there are short term benefits to chasing high basket penetration via discounting, it’s critical to protect the most profitable and valuable parts of the portfolio. Done right, confectionery can again resume its place as one of the category darlings of Australian retail. References: 1. ibisworld.com/au/industry/confectionery- manufacturing/5474/ 2. Project Hearth, Illuminera Australia, December 2020 3. Ibid. 4. Ibid. "It’s important to have a clearly defined brand and pack strategy to refresh or relaunch into more premium tiers and find ways CONFECTIONERY About Simon Elsby and Exceedra Simon is Sales Director APAC at trade promotions specialist Exceedra. He has more than 25 years’ experience in shopper and category strategy, revenue management, and organisational performance and capability building, working with global manufacturers across Asia Pacific. Contact Simon at simon.elsby@exceedra.com. About Exceedra Exceedra is a leading, pure-play consumer goods solution provider with a breadth and depth of solutions to continuously drive business value for any consumer goods company no matter their size, maturity, route to market, category or geographic location. Exceedra’s singular focus, broad solutions offering and partnership culture equip customers with smarter sales and distribution capabilities that improve agility, increase efficiency, enable better decisions and increase profitability. to encourage your shoppers to spend more based on value- added benefits." However, chasing basket penetration doesn’t necessarily have to be at the expense of value realisation. I firmly believe that brands need now to have a clear strategy for price realisation, and in the case of confectionery, this means a price per kilogram position where the brand aspirationally is growing faster than the category. It’s important to have a clearly defined brand and pack strategy to refresh or relaunch into more premium tiers and find ways to encourage your shoppers to spend more based on value-added benefits. In confectionery especially, you need to satisfy your consumers in a guilt-free way while being able to charge more at the same time. What to do? Key to revenue management in the confectionery category in the medium term are: • Evaluating and protecting market MAR/APR, 2021 CONVENIENCE WORLD 47