However, in one decade that is by 2020, most of these brands reported a steep decline in sales of toffee. So what really changed so drastically?
Before Unified Payments Interface (UPI), shopkeepers would shamelessly trade toffees for loose cash, a transaction that was not happening other way round. These small amounts over days did wound up to becoming large sums of money, as accepted by many buyers in studies. With UPI, all of this stopped, virtually overnight. People paid the exact amount that was due with no scope for change, ultimately eating up the daily toffee sales.
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The pandemic added fuel to the fire for the dip in sales for the candy industry. With the scare of virus everyone wanted to do contactless payments.
This also created soft of push towards digital payments and toffee went off the shelves. No chocolate (toffee) company would have ever thought of finance products as their competition. The lesson to be learned is that one needs to keep an eye on “What are the reasons people buy our product and what would change that behaviour? Do we find reasons which are not really our direct competition but can potentially replace our product usage?”
Agree, that most of the mentioned brands are not in the ‘chhuta (change) paisa’ toffee category but the rest common candies which were supplement to the “non-available change coins” suffered massively due to the induction of UPI payment.
UPI penetrated the market during 2017-19 and peaked up during the Covid-19 and during 2020 saw the most widespread adoption. Sure, the festivities and the market after Covid-19 onslaught meant a recovery but with the lack of money in the system and steeper pricing throughout the board, the customers for candies truncated. Technology has certainly eased out for many customers but for the candy industry it was devastating.
Why would one correlate availability of change (coins) in exchange for products (toffees) to UPI? Merchants figured out a way to keep their customers happy by offloading sweet toffees in exchange for balance of payment, which customers gladly accepted.
Anyone who has ever bought groceries from a local kirana store knows about the woes of the missing ‘chutta’ (change). It is there and the local mom and pop shops where ‘chuttas’ become candies. Candies comfortably, or rather uncomfortably for the customer, replaced chuttas or change while local shopping. But they never saw the biggest threat looming ahead – UPI.
Yes, retailers did use this very smartly to clear their inventory and also sell it to almost each and every customer. On the ethical front, the shopkeeper should bill and return the change to the consumer bought items only and they should not force their customers but many times the customers would gladly accept it to save their time at the register counter.
It is also true that candies and chocolates can never be eliminated from the market as kids and adults love it.
All hyper marts, supermarkets are now selling candies in pack of tens or so at pay and exit counters. What is required is a good branding and strategic placement of the product on the shelf which are easily seen while shopping. The importance of understanding the reasons people buy a product and what could potentially change the behaviour. In this case it was the advent of technology by way of UPI payments.
