According to IRI, the major four holiday seasons - Valentine’s, Easter, Halloween and Christmas - made up nearly half of US candy sales in 2015. Easter generated around $3.58bn of the $24.6bn seasonal total during the period.
OCHO's new 3.5-ounce organic Easter egg pouch contains individually wrapped milk chocolate Easter eggs filled with peanut butter.
OCHO has also launched a 1.5-ounce organic dark chocolate peanut butter bar to the natural and organic channels across the US.
“The Easter Egg was our first entry into the seasonal market," CEO of OCHO Scott Kucirek, told ConfectioneryNews.
"Sales data indicated very large demand for peanut butter eggs during the Easter holiday and once we built our state-of-the-art factory in 2015, we realized we could make an organic Easter product that would meet our high standards of taste, appearance and fun.
“We got a late start on development of the Easter project, and were pleasantly surprised at the reception for the product as we were just trying to get some pouches out this year to gauge receptivity for 2018.”
Coloring the ‘serious’ organic candy category
OCHO was founded in 2005 by Denis Ring, the creator of the 365 line at Whole Foods, and an industry expert on natural and organic food trends.
After five years of discussing the opportunity and following numerous store visits to Whole Foods, Trader Joe’s, Safeway and other grocery chains, OCHO was officially launched by Ring and Kucirek.
“It took us nine months to perfect the recipes and we started with sales in the Whole Foods Northern California region in the Fall of 2011,” Kucirek said.
“But we thought the natural and organic candy category had gotten too serious and that the brand should be fun and playful. We wanted a clean look and decided on our trademark white packaging with bright colors to convey clean and fun.”
OCHO currently manufactures all products, including its gluten-free, vegan coconut bar and dark chocolate bar, at its West Oakland factory.
“We hire people who live nearby as we believe it is important to bring jobs to economically challenged areas in the local communities," said Kucirek.
Strategy to compete with mainstream candy makers during Easter
Innovation and limited edition launches are key to boosting Easter sales, according to a recent conversation with the National Confectioners Association (NCA),
The NCA projects 2016 retail sales of Easter candy in the US will be nearly $2.4bn.
The March seasonal market has long been dominated by major players’ extension product lines, mostly adapted with new flavors and formats, such as Mars and Wrigley’s Skittles and Starbust Lip Smacker launched last year, Hershey’s Reese’s peanut butter eggs, and Just Born-made marshmallow brand Peeps.
“Many of the larger players in this space do not have any products to offer the natural and organic retailers and, thus we plan on using these partners as the platform to introduce the products,” Kucirek said. “These retailers serviced by UNFI and KeHE (both are natural, organic foods distributors) have been asking for products to sell during the holiday seasons that meet their customer demands.”
“However, we are also seeing interest in conventional grocery as those retailers have been focused on growing their natural and organic offerings… We plan on growing the Easter line over the next few years and believe it will be viable not only in grocery channel, but also in drug, club and mass channels too.”
Gearing up technology to sell seasonal products all year around
By the end of 2016, OCHO began operations at what it describes as one of the most technologically advanced candy factories in the world.
“Our focus now is to leverage this investment and knowledge to expand our sales over the next few years by providing the best-tasting organic candy bars, minis and seasonal offerings 365 days a year,” Kucirek said.
“With that in mind, we have a Christmas seasonal offering that is in the last stages of production and should be widely distributed for Christmas 2017.”
From 2013 to 2016, OCHO experienced a compound annual growth rate of 195%. In 2017, it plans to achieve growth of at least 40% driven by some of the additional launches of organic candy bars that the company expects will be its largest sellers.
"In 2016, Target dedicated space in its stores for Halloween-themed organic confections, which we took as the beginning of an organic seasonal marketplace of any measurable size. We are launching organic Easter Eggs this year and believe that there will be significant growth in the next decade of organic confections offered in a seasonal format. Since the baseline of this market was essentially zero, we believe that there is a large growth opportunity ahead for organic seasonal confections for Easter, Halloween and Christmas."