US candy companies sideline pricey Halloween chocolates for gummies, licorice, flavored crèmes

An employee shows a Hershey's chocolate bar made in USA in the "American lifestyle" store in Berlin · Reuters

By Jessica DiNapoli

NEW YORK (Reuters) - Trick-or-treaters hoping to collect handfuls of chocolate candy this Halloween might be facing a bit of a letdown.

U.S. confectionery companies are stocking store shelves with fewer Halloween chocolates and doubling down instead on cheaper gummies and licorice such as Mondelez's Sour Patch Kids and Hershey's Twizzlers ghosts, according to market research firm Circana.

Prices on sugary non-chocolate sweets - though still cheaper than chocolate - are also up double digits, according to Circana.

The shift to gummies, licorice and flavored crèmes comes as chocolate makers face shrinking margins and slowing sales. Consumers have been curbing their cravings for costly chocolate, and the candy companies have faced a double-whammy on their own costs for the treat, first from supply chain snarls during the COVID pandemic and now from a cocoa bean shortage.

"Chocolate candy, there’s just not as many items per retailer on shelf," said Dan Sadler, principal of client insights at Circana, who focuses on confection. “We’re seeing double-digit increases in non-chocolate items.”

Candy companies took a similar approach for Easter, unveiling new products lighter on cocoa. But for Reese's cup maker Hershey, a top U.S. chocolate maker, the sales results were disappointing, with the company's category for the spring holiday declining, executives told investors on conference calls. They pegged it on an earlier Easter and a shorter selling season.

A spokesperson for Oreo maker Mondelez said that shoppers for Halloween are looking for more limited editions and special flavors, such as its Sour Patch Kids' apple harvest and cherry varieties. Mondelez does not have a major U.S. chocolate brand.

Privately-held Mars did not reply to a request for comment.

Hershey's key new products for Halloween are its Reese's Werewolf Tracks, which feature a vanilla crème top instead of milk chocolate, and its KitKat Ghost Toast with a cinnamon toast flavored crème, a spokesperson for the company said.

The Hershey, Pennsylvania-based company sees non-chocolate candy as having potential for higher growth, the spokesperson said. Last month Hershey introduced two new non-chocolate candies, Jolly Rancher Ropes and Shaq-a-Licious gummies, which are inspired by the former U.S. basketball star Shaquille O'Neal.

Hershey plans to introduce more sweets in the next several months, the spokesperson said.

To be sure, the spokesperson added that chocolate makes up a bigger part of Halloween sales across the candy category compared to everyday purchases.