GROSS IS GOOD
By Bill Saporito

(FORTUNE Magazine) – Tried any SNOT lately? How about Pond Scum? Maybe you'd enjoy some Wurmz-N- Dirt. Novelty candy items that foam and pop, turn the tongue blue, and gross out grownups are where the action is in the confectionery industry these days. "It's tough to get excited about another chocolate bar. Novelties are the fun part of the business," says Bill Odelson, vice president of sales at Sherman's Confections in Covina, California, the creators of SNOT, a.k.a. Super Nauseating Obnoxious Treat, which dribbles out of a nasal container. Sales of Geeks, Skin Critters, Mega Maggots, and various other scummy gummies are increasing at a 7% rate, twice that of the overall nonchocolate segment, while sales of chocolate are actually decreasing. Nonchocolate candy revenues totaled $3.7 billion last year at wholesale; chocolates stalled at $6.8 billion, according to the Department of Commerce. Novelty makers tap into the huge vein of discretionary income controlled by kids. These consumers have a nanosecond attention span, so products last six to 12 months. (Just like the PC industry; the difference is that candy is still useful after a year.) Industry leader Amurol, a division of Wm. Wrigley Jr., churns out 12 to 24 new items annually, ranging from Bubble Tape (bubble gum that looks like a tape measure) to Candy Jug (powdered candy in a detergent-shaped bottle). Tekkies can lick a lollipop embedded with a hologram, made by the Edible Candy Corp. of Canada. Find the right product and retailers come begging. Philip Morris's BerZerk Candy Werks moved six million CandyCallers between May and December. The gimmick: candy packaged in a plastic cellular phone with a keypad that makes telephone sounds. The phone bill: $2.99, vs. 50 cents for a typical candy bar. BerZerk is back with the Candy Keyboard and Candy Pager this year. Forget taste -- the play factor creates price premiums. Pond Scum and Spew, for instance, foam in and out of the mouth for that rabid critter look. "It gives new meaning to the term gross margin," says Steven S. Nicolet, president of Creative Confection Concepts in Milwaukee. Nicolet's contribution to society is the Bubble Tongue -- an ugly, oversize plastic one filled with a powder that solidifies into gum. Just add spit.