Confectionery in Uruguay

Prospects

Retail volume sales of tablets decline as manufacturers significantly reduce sizes

Tablets continued to record the highest retail volume sales within chocolate confectionery in 2019, with these products remaining the most popular choice for Uruguayan consumers, independent of their income level. Consumers in the country tend to be highly traditional in their consumption habits, with the majority continuing to prefer plain milk chocolate tablets in 2019.

Government campaign against obesity and overweight issues could damage chocolate confectionery

Obesity and overweight issues increased significantly in Uruguay over the review period. Consequently, the government launched an awareness creation campaign explaining the risks of these conditions, such as chronic diseases.

New labelling system planned to identify high added sugar, salt and fat contents

The government has announced it is planning to introduce a new labelling system for foodstuffs which will be implemented and must be complied with by the end of 2020. Under the legislation, black octagons with white lettering must appear on certain types of food warning of high levels of salt, sugar and fat, if added during processing.

Competitive Landscape

Large international GBOs lead with strong innovation

Brands from international GBOs, including Nestlé, Mondelez International, Arcor SAIC and Grupo Bimbo SAB, usually distributed by domestic or regional players, continued to lead chocolate confectionery in 2019. These international players all introduce regular new product launches and innovations in order to maintain their shares.

Ricardito supports the Uruguayan national football team in the Copa America tournament

The Ricardito brand by Plucky (GBO: Grupo Bimbo SAB) continued to implement a strong communication programme on Facebook, where it positions itself as a typical Uruguayan tradition. To emphasise this message, it supported the Uruguayan national football team during the Copa America in Brazil in 2019, showing the latest scores for the team’s games throughout the tournament, using a picture of the Ricardito product to represent Uruguay.

Other domestic brands demonstrate their patriotism by supporting the national football team

Chocolate Haas, a Uruguayan brand, also supported the national football team during the Copa America, using cartoon characters of the brand demonstrating their support for the team. This was an effective way for domestic brands to demonstrate their local roots and show their patriotism and support of the national team, which has a near universal following in the country.

Prospects

Changes in consumer preferences favour chewing gum

Historically in Uruguay, consumers tended to prefer bubble gum over chewing gum, with attractive options available, especially for younger consumers, and a price differential between sugar and sugar free products. However, this began to change just prior to the review period, and since 2012, chewing gum has been the preferred choice for consumers.

Ongoing flavour innovations in chewing gum attempt to maintain consumer interest

Producers are constantly launching new flavours in chewing gum in order to maintain consumer interest, although mint flavour is the most popular, especially among adults. Mint flavour variations include Mint, Strong Mint and Light Mint, as well as Menthol and Menthol Turbo.

A slight decline in consumption is predicted

It is expected that consumption of gum will continue to decline slightly over the forecast period, with bubble gum faring slightly worse than chewing gum. Companies will doubtless continue to launch new flavours and different formats of chewing gum to maintain consumer interest, and, although new launches will sustain interest among consumers, the overall gum category will not be able to avoid declining consumption, and producers will need to work hard to reverse the situation.

Competitive Landscape

CAS Uruguay maintains its lead with a strong brand and innovative marketing

CAS Uruguay retained its strong lead in gum in 2019 with its Beldent chewing gum brand (Mondelez International). Beldent enjoys extensive distribution in virtually all retail outlets in the country.

Van Dam competes strongly in second place with active online promotion

Van Dam, another international company, ranked second in 2019 with the majority of its sales coming from its Top Line chewing gum brand. The player also generates most of its sales in chewing gum, although it also offers bubble gum products.

Other brands begin to eat into the leaders’ share

Although Beldent and Topline dominate gum between them, other international brands ae beginning to grow in popularity in Uruguay, including Spearmint and Winterfresh from Wrigley’s, and Mentos, with gum offered in plastic boxes, which constitutes an original packaging for the category. Sebamar launched its Mentos chewing gum products in 2017-2018, which, although still having low sales, could generate competition going forward.

Prospects

Consumers are less loyal to sugar confectionery brands due to price sensitivity

Uruguayan consumers are highly price sensitive and not as loyal to the main brands of sugar confectionery as in other categories, which explains the relative strength of private label products. The supermarket chain, Tienda Inglesa, has one of the widest varieties of private label products at competitive unit prices with its Tienda Inglesa line, while Supermercados Disco del Uruguay also holds a reasonable share with its Leader Price range and Mimatec is some way behind with its Multi Ahorro private label products.

Sugar confectionery largely bought on impulse from kiosks

Sugar confectionery is mainly driven by impulse sales with the most important channel being kiosks (listed under other grocery retailers), followed by supermarkets. Kiosks are widespread in the country in high footfall areas and boiled sweets are readily available in these outlets in small pack sizes and single portions at affordable prices.

Consumers seek flavour at affordable prices over well-known brands

Although Arcor from Van Dam was the clear leader in 2019 with an increasing brand share, Ski by Penino y Corona remained in second place, albeit some distance behind, with a variety of boiled sweets lines. The company began as a family business and its success is all the more notable because it is not present on Facebook, in contrast to the large international brands and its does not seem to place any great emphasis on its online presence.

Competitive Landscape

Arcor remains the leading brand supported by strong promotions

Arcor by Van Dam remained the leading brand in sugar confectionery by some distance in 2019. The brand is available in a large number of variations.

Arcor launches an initiative to help portion control

Arcor launched an initiative under the name of “tu porción justa” (the right portion for you), which consists of a green label on the front of packs stating that the content of the package is equal to one snack or, in the case of larger size packages, how much of the package is considered one portion. This is in line with the growing awareness of consumers of the importance of a healthy intake of sugars and fats and the ongoing discussions around a potential labelling law in Uruguay.

El Almendro launches turron

The El Almendro brand introduced a number of innovative products containing turrón, a type of nougat. Turrón is one of the main product types in sugar confectionery in Uruguay and El Almendro launched this classic in the format of a stick with traditional, salted-caramel and caramel-chocolate flavours, as well as snack cubes positioning them as “naturally made from almonds” with a high almond content.

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