Gum Retains Sales Pop in Recession

April 16, 2010

Gums, mints and breath fresheners and sweeteners have kept mouths moving for as long as we can remember

Gums, mints and breath fresheners and sweeteners have kept mouths moving for as long as we can remember - often curbing the mindless chatter many of us like to avoid. People use these products to keep their breath appealing and their favorite gender close. These items can help satisfy an urge in a low- or no-calorie way; they can keep new taste sensations easily available in a pocket or purse; and gum in particular has become a form of medication delivery.

Consumers find these small packs so versatile that nearly two out of three households in the United States (62.2%) bought prepackaged, UPC-coded gum, for instance, in the 52 weeks ended December 26, 2009, according to Nielsen Homescan Consumer Facts data. F3 suspects the penetration would be even higher when counting convenience store purchases as well.

Breath freshening is the top function of these products in the minds of consumers, notes Mintel in a newly released survey; 43% of respondents said this vs. 13% that named a health function. But health could be on the rise as a sales-driving trait. "In recent years, gum and mint manufacturers have placed an emphasis on the health-delivering benefits of their products...[such as] whitening teeth, strengthening teeth and overall oral hygiene. Mints have...antioxidants, green tea and other health-promoting ingredients," explains Bill Patterson, senior analyst at Mintel.

The Mintel study suggests that innovative flavors will also help advance growth through 2014. Some 43% of gum chewers say they like to try new brands or flavors because they like the variety, and 13% try new brands or flavors seeking one they love.

For now, the consumer perception of a small treat at a low price suffices to keep these products from suffering much in the recession. Indeed, dollar sales performance in this $2 billion+ category at the shelf was led by a perennial favorite during the 52 weeks ended February 20, 2010.  In U.S. food, drug and mass merchandiser stores (including Walmart), sugar-free chewing gum dollar sales rose by 7.7% to $1.54 billion, following an 11.0% dollar sales jump in the prior year. The segment still looked pretty good on an equivalized unit volume basis, up 5.3% in the latest 52 weeks compared with an 8.1% climb the year before.

This is virtually an all branded business. Sugar-free chewing gum, for example, has a 99.9% dollar sales share in brands; the only meaningful encroachment occurs in the comparatively tiny breath freshener segment (14.2% private label share, $1.2 million) and the bubble gum segment (3.5% private label share, $3.7 million), the Nielsen data show.

Chewing gum (not the sugar-free varieties) also grew in the latest 52 weeks, by 1.5% to $200.4 million, a positive turnaround after a 9.6% slump in the prior year, Nielsen reported. The breath fresheners segment, while small, showed a similar rebound in dollar sales, up 5.7% in the latest 52 weeks to $8.3 million vs. an 11.2% decline the year before.