What Bars Do Best
Oct. 1, 2011
by Charlotte Atchley
After about 30 years and a sales boom in 2006-07, the bar category has seen consistently slow growth. With a stall in 2008-09, mostly blamed on the recession, the bar category has yet to regain momentum with rising commodity prices holding bars back. But that could change as producers bring out innovative new flavors targeting consumer wants and desires.
According to SymphonyIRI’s survey of the category, for 2009-10, the total bar category saw a 7.71% increase in total dollar sales, and for 2010-11, the category rose 6.23% in dollar sales, which were both up from 2008-09’s 2.45% rise in sales (see chart on Page 32). The granola and nutritional bar segments earned most of this growth as dollar sales of cereal and breakfast bars have seen minimal change since 2009.
Brian McNamara, vice-president of marketing and sales, Hearthside Food Solutions, Downers Grove, IL, speculated that the category is being held back because bars are often an impulse buy for consumers, and impulse buys suffer when prices go up. However, he also suggested that the price increase is balanced out by product innovation, which has always driven the category. Innovation is so vital that Mr. McNamara uses it to predict the business of Hearthside, which co-manufactures products for major bar brands.
“One of the barometers of my future business is how many line tests and trials I’m doing,” Mr. McNamara said. “It doesn’t necessarily affect my business in this quarter, but it will affect my business in the next quarter and the quarter after that.”
According to research group Mintel, Chicago, IL, although its data shows a decline in new product launches since 2007, it asserts that new products continue to shape the category. In fact, in 2009, the No. 2 granola bar manufacturer, Quaker Oats Co., Chicago, IL, made significant gains on the No. 1 bar producer, General Mills, Inc., Minneapolis, MN, which Mintel attributed to the success of Quaker Oats’ product launches that year. Mintel identified three themes guiding new product launches: all-natural and organic ingredients; functional health benefits; and taste, flavor and form variety.
BACK TO NATURE.
In 2006, entrepreneur Veronica Bosgraaf jumped on board the organic, all-natural ingredients trend in her own kitchen when she tried to make a bar that would be delicious, deliver good nutrition and contain only organic or all-natural ingredients. Ms. Bosgraaf’s experiments quickly turned into a company, Pure Bar, Newport Beach, CA. This idea of a simple, understandable ingredient label guides all that Pure Bar does.
“Our product has always been gluten-free, which is a huge trend,” Ms. Bosgraaf said. “We’ve always used organic ingredients, another huge trend. I almost hate to call it a trend because I feel like it’s a shift.”
Ms. Bosgraaf wants consumers to see that they are getting protein and fiber from Pure Bar and that they can understand the ingredient list.
“Consumers are looking for primarily good ingredients — simple, real ingredients that they can understand,” she said. “I think second, but very close, they’re looking for nutritional balance. They’re flipping the bar over and reading the ingredient deck. If all the ingredients look healthy and understandable, then they’re scanning over to the nutritionals and making sure they’re getting protein and fiber.”
To reach new consumers, Pure Bar launched the Pure Bar Naturals line. Although made with mostly organic ingredients, this line is not certified-organic, thus less expensive. Ms. Bosgraaf said the goal was to make Pure Bar more accessible and expand beyond health food stores.
Pure Bar isn’t alone, however. Clif Bar & Co., Emeryville, CA, reaches out to the health-conscious consumer by using organic ingredients. The company avoids hydrogenated oils, high-fructose corn syrup (HFCS), artificial flavors, preservatives, sweeteners and genetically modified (GM) ingredients in all its products.
According to Mintel, consumers perceive bars to be a better-for-you snacking option, which means when healthy become trendy, bars win. To tap into this relationship, manufacturers are making bars that carry the trendiest functional benefits: fiber, protein, omega-3s and antioxidants.
When Ms. Bosgraaf created Pure Bar, she wanted the bar to be a vehicle for delivering nutrition to her children. Now, Pure Bar serves to the consumer as much as 7 g protein per serving as well as antioxidants, omega-3s and fiber but as little as 9 g natural sugar.
This year, Quaker Oats launched the Fiber and Omega-3 product line with 35% of the Daily Value of fiber and claims to be an “excellent” source of omega-3s. Oak State Products, Inc., a contract bakery based in Wenona, IL, recently developed a bar that contains a full serving of fruit to meet the expectation of functional health benefits in bars.
Clif Bar launched a protein bar under its Luna brand that not only carries 12 g protein but also 3 g fiber. The Luna Protein bar also cross-markets a gluten-free claim.
“Protein and gluten-free options are two popular trends in the healthy snacks category,” said Steven Grossman, vice-president, Clif Bar. “The protein trend is hot for women, and our recent product launch, Luna Protein —now gluten-free across all flavors — has been a huge success.”
Clif Bar also revamped its Luna Whole Nutrition Bar for Women to include vitamin D.
FLAVOR TAKES ALL.
When it comes to food, however, healthy is nice, but taste is king. Despite the movement toward cleaner labels, natural and organic ingredients, and functional health benefits, taste is still the No. 1 criterion for consumers when it comes to buying a food product, according to Mintel data. Developing new flavors can be the easiest way to update a category.
Quaker Oats brought an old standby, chocolate, into the 21st century with real-cocoa products. The Quaker Chewy Cocoa line maintains the Chewy nutrition profile (calcium, fiber, a serving of whole grains and no HFCS) but in four different chocolate flavors: Chocolate Swirl, Chocolatey Caramel, Cookie Dough and
Not only can companies reinvent old favorites like chocolate or peanut butter, but they can also find ways to use flavors no one else offers. Pure Bars saw a need in the organic bar market for both blueberry- and cherry-flavored bars and filled the gap with its Wild Blueberry and Cherry Cashew flavors. Ms. Bosgraaf said both varieties have been successful, and the company plans to expand the flavors in both its Pure
Organic and Pure Naturals lines.
With the consumer shift toward healthy eating, bar producers are cooking up new products to reinvigorate the category and take advantage of the product’s better-for-you image. This image makes bars a great vehicle for functional health benefits and natural and organic ingredients. With such a blank canvas for creative flavor possibilities, bar producers hang their hats on innovation as the key for pushing them out of a post-recession slump.