Calling all crackers
July 27, 2010
by Eric Schroeder
The cracker category can credit its recent success to a number of factors: innovation, health and wellness benefits, and the full recovery from the January 2009 peanut butter Salmonella outbreak.
In the 52 weeks ended June 13, cracker dollar sales totaled $4,071,546,000, up 1.7% from the same period a year ago, while unit sales rose 3.4% to 1,619,187,000, according to SymphonyIRI Group, a Chicago-based market research firm.
Driving the gains has been the sharp recovery in the “crackers with fillings” category, the second largest cracker segment tracked by SymphonyIRI in terms of dollar sales. It has been a little more than a year and a half since the Peanut Corporation of America announced a recall of peanut butter produced in its Blakely, Ga., processing facility due to Salmonella concerns. The recall affected not only the companies that were using the tainted peanut butter, but also those companies with no link to the Peanut Corporation of America but who were players in the category.
In total, the crackers with fillings category rose 19% to $370,436,700 on a 14% gain in unit sales in the 52 weeks ended June 13, according to SymphonyIRI. Kraft Foods Inc., Northfield, Ill., which has a 34% share of the filled crackers category, posted a 26% gain in dollar sales and 21% gain in unit sales, while the No. 2 player (with a 30% share), Lance, Inc., Charlotte, N.C., saw dollar and unit sales rise 15% and 13%, respectively. The No. 3 company, Keebler Co., Elmhurst, Ill., experienced a 31% gain in dollar sales.
To a smaller degree but on a larger dollar and unit scale, the overall cracker category has been spurred forward by “all other crackers,” which accounted for more than $3 billion in sales during the 52 weeks ended June 13, according to SymphonyIRI. Each of the top five brands posted improved year-over-year unit sales, led by 38% growth by Stacy’s Pita Chip Co., a division of Frito-Lay, Inc., Plano, Texas.
Aurora Gonzalez, a spokesperson for Frito-Lay, attributed the growth at Stacy’s Pita to the brand’s health and wellness attributes, as well as to the versatility of the chips.
“It’s such a natural pair for dips,” Ms. Gonzalez said. “It just plays well with the health and wellness trend.”
The second biggest jump in the cracker category, 6%, was scored by Pepperidge Farm, Inc., Norwalk, Conn.
“One of the reasons people pick crackers and pick our crackers as an alternative when they’re snacking is they are better for you,” Mark Alexander, president of North America Baking and Snacking at Pepperidge Farm, said during a July 12 analyst meeting. “These are wholesome snacks, and we will continue to build on the credentials that we have in this space by upgrading them. Goldfish we’ll be taking and going for no artificial colors. We’ll be adding whole grains into our new graham launch to make those an even healthier alternative for sweet snacking. And in Shapes, which is really our iconic
franchise in crackers in Australia, we’ll be making a significant reduction in the fat and saturated fats of that product by changing the oil mix, something we’ve learned in our collaboration between Arnott’s and Pepperidge Farm over the last few years.”
Mr. Alexander said the Arnott’s brand has received good response to a rice cracker introduced in April.
“This is a large segment within the category that we had not been participating in, and we entered with a highly differentiated product, made with brown rice, that offers taste superiority over the nearest competitor,” he said.
In the United States, Mr. Alexander said Pepperidge has targeted the adult segment with its Baked Naturals line of crackers.
“This year we launched Cheese Crisps, which has expanded that (focus on adult snacking crackers),” he said. “We’ve got more line extensions and more marketing for this line to drive our wellness credentials in the adult cracker market.”
Category leaders Kraft Foods and Keebler Co. both posted year-over-year cracker dollar sales declines even while registering unit sales growth during the period.
Kraft continues to benefit from strength in its Wheat Thins, Ritz and Triscuit brands, the latter two both of which posted better than 5% unit sales growth during the most recent 52 weeks tracked by SymphonyIRI. In the Wheat Thins product line, Toasted Chips had dollar and unit sales growth of 5% and 6%, respectively, during the period as consumers continue to gravitate toward toasted chip and cracker products.
At Keebler, the category-leading Cheez-It brand posted dollar sales of $339,264,600, up 2% from the same period a year ago on a 4% gain in unit sales to 126,331,100. But it was the Town House brand, especially Town House Flipsides, which generated the most interest, with dollar sales for Flipsides rising 20% on a 28% gain in unit sales. Keebler has several new cracker products hitting the market, including Town House Flatbread Crisps in two varieties: Italian Herb and Sea Salt & Olive Oil.