WHEN WEIGHING YOUR CONFECTIONERY NEEDS FOR THE HOLIDAY SEASON, CONSIDER THIS: There’s a reason diets don’t start until after the New Year.

The holidays are a time for indulgences—which means a lot more sweets and treats for most consumers and another reason to rejoice for well-stocked specialty retailers.

To take full advantage, retailers should begin with a good understanding of their shoppers’ needs and demographics, as well as the different dynamics of the period, according to Ray Jones, a managing director for confectionery industry consultants Dechert-Hampe & Company, based in Northbrook, Ill.

Christmas ranks third for confectionery sales, behind Halloween and Easter yet ahead of Valentine’s Day. However, Christmas is distinguished because it is not just a holiday—it’s a season and a lengthy one at that. At retail, it begins before Thanksgiving and lasts through early January.

Within that stretch, Jones says research indicates three distinct purchasing stages: decorations, gifts and stocking stuffers. Each demands different confectionery needs. Green and red M&M’s® and candy canes work for decorating, hand-painted packaged truffles make an impressive gift for the boss, and bright-colored novelty sweets are a hit with kids.

Retailers who offer the greatest variety for each period and create a holiday feel within the store will see the greatest returns. “You need to merchandise around the occasion, not the product,” Jones observes.

Edible Entertaining
Since people gather more during the holidays, hosts want their homes to look festive and beautiful. This is the first stage of holiday sweet shopping, and it demands pretty candies that create a holiday feel.

Gourmet malt balls are among the most popular items from Brooklyn, N.Y.-based Madelaine Chocolate Novelties. The company also sells foil-wrapped mini-snowmen, Christmas bells and Christmas presents, which look great in a bowl on the coffee table. Peanut butter and caramel truffle bite-sized Santas are new for 2007.

Consumers also need easy and delicious serving options on hand. At Zingerman’s Delicatessen in Ann Arbor, Mich., bags of bulk Italian chocolate bark fly off the shelves during the holidays.

“At $30 a pound, it’s not a bargain but it is a distinctive finger food for unexpected guests during a season when people are willing to pay more,” says Reina Leber, manager of Zingerman’s Next Door. Other high-end confections include bulk toffee, sticky nougatina and gianduia (a velvety hazelnut and chocolate mixture) which
is sold by the slab and perfect for cheese trays.

At Cooks Fresh Market in Denver, the emphasis is on fresh-made baked goods—starting with a bourbon pumpkin pie at Thanksgiving and leading to more than a dozen different Christmas cookies, bouche Noelle and panetone. “Our customers are looking for items that are made from scratch. They can get the same cakes a lot cheaper somewhere else, but they are discriminating and they want the high-quality,” remarks Owner Ed Janos.

Indulgent Gifts
Consumers spent 56 percent more on food gifts from 2004 to 2006, and one in three consumers bought a specialty food gift during the holidays, according to a 2007 study by Packaged Facts.

For specialty retailers, this second stage of holiday confection buying is important, as consumers are more indulgent and more likely to buy a specialty item. “They want something they are not going to find at a grocery store or even at Whole Foods,” says Zingerman’s Leber.

Consumers are also looking for ready-to-go gift packaging, and confectioners are responding with more sophisticated looks and greater variety. “They really want something that is attractive, and the flavor and taste is worth the price,” says Virginia Feitner, a managing partner for Sensational Sweets, Lewisburg, Pa. “We have seasonal packaging, like blue snowflakes that sell through Hanukkah and the Christmas season.” The company’s line includes gourmet drizzled popcorn, dipped pretzels, fruit clusters and fudge bites.

Colorful confections that speak boldly through their packaging are available from Koppers Chocolate in New York City. Retailers can order a wide variety of confections such as chocolate espresso beans, mint lentils and gourmet malt balls in red, green and white candy shells for the winter holiday season. The company’s Dazzle Collection of Almond Jewels and malt balls add sparkle to any gift, while blue and white almonds are perfect for the kosher trade.

Stichler Products in Reading, Pa. is more than 100 years old, but President Marty Deutschman has found that people’s tastes have recently become more secular. Penguins and snowmen have become the reigning characters. “Santa used to be number one, but now retailers are a little afraid to display too much religion,” he says.

At Cooks Fresh Market, baskets are a big gift seller. They are another opportunity for a specialty retailer to showcase holiday confections. Think creatively and package sweet with savory, or chocolate with wine.

For a novel idea that capitalizes on the gift card trend, offer a pre-packaged gift card/chocolate combination, Dechert-Hampe’s  Jones recommends. “A gift card is impersonal. The confection adds something special, even if you are only adding a dollar or two worth of value.”

Confections for Kids
Children should not be forgotten. Confections supply the final treat in the stocking or an extra touch of wrapping for presents. They should be inexpensive and eye-catching.
Kids want treats that are recognizable, sweet and fun, like Santa’s Coal from McKeesport Candy Company/ CandyFavorites.com. The little pieces of black bubble gum come in a pouch and are a perennial favorite, along with a giant bubble gum candy cane and classics like the Pez Christmas dispenser and peanut butter Christmas trees.

“There’s greater sophistication, so consumers are purchasing more novelties,” says Owner Jon H. Prince. “But people love traditions, so there’s a limit to the ways you can innovate.”

Leslie Koren’s articles have appeared in The Washington Times and the Bergen Record.