Chewing gum, coming off a brutal year for retail sales, is back in demand as American start taking off their masks – and don’t always like what they smell.
As restrictions ease and vaccination rates rise, U.S. gum sales have recently started rising, data from NielsenIQ show.
The nascent turnaround follows two straight years of declines for the 12-month periods ended in May, a signal consumer behavior is slowly returning to normal.
The pickup in gum spending is a welcome change for the likes of Trident-maker Mondelez International Inc., Mars Inc.’s Wrigley and Tootsie Roll Industries Inc., the manufacturer of Dubble Bubble.
It’s not just inflation driving the jump in total sales, although prices per unit are also up.
The average pack of gum sold in May was $2.11, the data show, up from $2.05 at the start of the year.
The number of packs sold is also up, with Americans purchasing nearly 15 million more packs of gum in May compared to January levels.
Gum demand pulled back during the pandemic for clear reasons: Americans weren’t frequently leaving the house or socializing, and required masking plus 6-foot distancing meant consumers weren’t in need of minty freshness like in pre-pandemic times.
The rebound in recent weeks also reflects comparisons to the early weeks of the 2020 lockdowns, when demand for many nonessentials pulled back sharply, meaning there’s still more room to grow.
Mondelez has made returning near pre-Covid levels the gum business’s “number one priority,” Chief Financial Officer Luca Zaramella said at a conference last month.
The gum unit could be ripe for a sale if it doesn’t recover further.
“We have to fix the business and then potentially assess whether there are other avenues for us to create more value for Mondelez’s shareholders,” Zaramella said.
Mondelez, Mars and Tootsie Roll didn’t immediately respond to requests for comment.
Consumers’ restricted mobility of the past year especially impacted the category, since “75% of gum consumption is on the road,” Dirk Van De Put, Mondelez’s CEO, said at a conference in late 2020.
“Because you’re on your way in public transportation or in your car, at work, you’re going out – that’s typically gum consumption moments,” he said. “But we’ve also seen that in the crisis, there’s a lot more stress and anxiety and gum can be a relief.”
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