IN THE MIX 2002

BARBARA MURRAY

Retailers are positioning ethnic candy as a destination for selective candy shoppers by separating it out, keeping the ethnic group to itself, as this segment -- especially Hispanic and Asian varieties -- grows along with those populations.

"Very few run it all together. They use 4-foot or 6-foot sections. They will do the same thing as with seasonal candy," said Charles Edwards, vice president of sales for Bobs Candies, Albany, Ga. Bobs is one of the mainstream brands that has recently introduced new flavors and packaging to appeal to the Hispanic consumer.

Other manufacturers are Masterfoods USA, Hackettstown, N.J., which introduced Dulce de Leche M&M's in five test markets last year, and Necco, Cambridge, Mass., which makes its Conversation Hearts in Spanish, as well as English.

Nestle, too, has come out with dulce de leche coffee nips, and "we've been buying the Spanish Conversation Hearts for four or five years," said Lynett McCoy, candy buyer for Minyard's, Coppell, Texas. "We've gotten heavily into the Mexico import brands, with dump-ins and displayers, and imports from Spain, too," she added.

"There are a lot of new products, capitalizing on the new wave of Spanish, but you could also look at it as a novelty," said Frank Sendra, an account director for Zubi Advertising, Miami, which follows the candy business.

Consumers are asking for Conversation Hearts in other languages as well, according to Necco Marketing Manager Lory Zimbalatti, who said language teachers, especially, request this since they use them in class. "A lot of people were looking for it in places you wouldn't expect," said Zimbalatti. Math and statistics lessons are also conducted using the different colored and flavored hearts.

Spanish Conversation Hearts have been in limited markets since 1981, but "this year, we decided, because of demographic trends, to get it out nationwide," said Zimbalatti. "We redesigned the box, although it still has the little window, and we redid the sayings." Wal-Mart bought them, she said, but for selected stores rather than for every store, as did Walgreen and Family Dollar.

Wise retailers tailor their selections to the demographics around their stores.

The 306 Southern California Albertsons units hone in on Hispanic and kosher candy, which both do very well, according to Steve Peters, ethnic sales manager for that division. Those stores carried M&M's Dulce de Leche caramel variety, which Peters said did well, although the candy was discontinued at the end of July.

Albertsons also carries a couple of other bagged candy lines, such as Payaso, from Mexico.

"It's going to continue to grow," Peters told SN. "I don't think we are at the peak of any of the Hispanic products right now."

"Give it another 10 to 15 years, and the number will be a lot larger out there than what we've seen so far," said Edwards, of Bobs Candies. Last Christmas, Bobs introduced candy canes in strawberry and lemon-lime flavor, with bilingual packaging.

"They came in at the tail end of our purchasing, so I didn't have very good feedback on what kind of sell-through they had at store level," said McCoy of Minyard's.

Strawberry did better, Edwards told SN, and, he said, the company sent the package back for a graphic re-design, a good move even though it made the introduction later than planned.

Ethnic candy is certainly a big trend right now, with America's changing demographics, said Susan Fussell, manager of communications for the National Confectioners Association, Vienna, Va. According to U.S. Census data from 2000, almost 25% of the U.S. population identifies itself as something other than Caucasian, she added. And the Hispanic population in the United States has grown by 58% since the 1990 Census. The Asian segment is actually the fastest-growing, and even though it is about one-third the size of the Hispanic population in America, Asians spend more than half as much.

Asian Americans spend $225 billion a year, according to Census data, and Hispanics, $438 billion. There are 32 million people of Latin descent living in the United States, and 12 million people of Asian descent.

"It's important for American manufacturers and retailers to reach into these growth segments," Fussell said.

Edwards said that for 2003, the company might add some other items for Christmas and possibly for every day.

"Most people really fail to realize that even in the Atlanta market there are over 300,000 Hispanics, according to the latest Census. When I read that, I thought, 'Good gosh,"' he said.

"When you look at the polls, the Hispanic population has now surpassed black, and by the end of 2050 they [Hispanics] will be over 50% of the U.S. population, and will be the No. 1 population group by 2095. Asians will be No. 2, if they keep up the current growth rate," Edwards said.

Jungle Jim, a Fairfield, Ohio, independent that keeps expanding its store, now at 190,000 square feet and growing, offers a wide range of ethnic treats.

"We have candy from Italy, Germany, South Africa, Ireland, the Orient," said Brett Vitek, general international foods manager. "A lot of it is bought by the basic transplants, people from England, and Asians, all the ethnic groups, but also, a lot of curious Americans that see it want to try it," he said.

"From Italy, we have nougat. That's probably one of the most sought-after all year round, and we have some Italian chocolates," Vitek continued. The Italian is not a big candy consumer, he added, but they like confetti-colored Jordan almonds. Halavah, the Middle Eastern confection, often sold in bars, made of sesame paste and sugar, is a staple in some households.

"In my Middle Eastern section alone, I have 16 different varieties of halvah," Vitek said. Some are sugar-free. Some come in one- or even two-pound plastic containers, but most of it is 16-ounce.

This is not a gourmet section, but displays foods from 65 different countries, broken down by country. There are different candy sets, one of 20 feet, one of 4 feet, in the International Foods section, which is over 40,000 square feet. "We are under construction now to expand international another 30,000 [square feet] and the front of the store, too," he said.

The English, he said, are the biggest consumers of chocolate. Two items are the most sought-after: One is a Flake bar, made by Cadbury, and the other is Crunchie, also from Cadbury. From Australia comes Violet Crumble, in a purple package, a milk chocolate over a honeycomb, "an excellent candy bar, one of my favorites," said Vitek.

Holidays, of course, provide an opportunity to merchandise ethnic items. Vitek's section usually has about an 80-foot run of European Christmas candy, mostly English and German products, such as marzipan in shapes of fruits and animals. Easter was big, he said. "The items we brought in for the English part of it did real well for us." On weekends, Jungle Jim draws from a 200-mile radius, Vitek said, adding that some customers come into nearby Cincinnati for a Reds game, stay overnight and shop the next day.

The Mexican section contains novelty items such as a plastic squeeze container filled with a tamarind-flavored liquid that both kids and adults like to squirt into their mouths, and a lot of gum products, like Mexican Chiclets.

In general, Vitek told SN, the retailer tries to get the items that people request, as long as they are at affordable, not specialty, prices. "Kroger won't get the type of items that we have. That's why we keep growing and growing. If you get what people want, they appreciate it," said Vitek.

Using the Treasure Hunt phenomenon also helps, he said, saying Jungle Jim lets its shoppers know when there is an item that won't be available again. Also, since it imports candy from all over the world, sometimes small suppliers don't want to ship in the heat, nor can they pay for expensive refrigerated shipping, or product could be held up at U.S. Customs. For all these reasons, he said, "I might be out of product for one or two weeks. A lot of our customers see something and grab as much as they can, because next time they come in, it might not be on the shelf."