It’s no secret that snacking is here to stay. Consumers snack more often throughout the day, and they’re looking for options to satisfy hunger, nutrition and indulgent cravings, all while delivering great taste and an exciting snacking experience. Consumers want it all — fun and functional at a reasonable price — according to Mintel’s 2019 "Snacking Motivations and Attitudes” report.
Salty snacks showed steady dollar sales growth at 4.7%, posting more than $19.2 billion in the U.S. snack market for the 52 weeks ended June 16, according to Information Resources, Inc., a Chicago-based market research firm.
Snack occasions are proliferating, and what constitutes a snack is changing. That’s challenging the annual category leader — salty snacks. While flavor and indulgence are still key drivers, nearly two-thirds of snackers prefer healthier options, according to Mintel’s report.
“Producers will do well to provide more nutrient-rich snacks, or those perceived as healthy, while offering a similar salty, crispy and tasty snack experience as a regular chip,” said Tom Vierhile, vice-president of strategic insights, North America, Innova Market Insights.
Big growth in better-for-you
Consumer obsession with health and wellness through popular diets like paleo and keto is a primary driver for snack innovation. Functional claims also have grown, with consumers seeking high protein and fiber, probiotics for gut health, and alternative snack bases made with beans, vegetables and fruit.
“As vegan lifestyles become more mainstream, consumers are seeing the health and environmental advantages of plant-based diets,” said Hector Briones-Sanchez, vice-president of marketing, innovation, Campbell Snacks, Camden, N.J.
Innova Market Insight’s 2018 Consumer Research Survey showed that American consumers are trying to increase consumption of fruits and vegetables.
“Food as medicine continues to be a trend,” said Kim Holman, marketing director, Crunchmaster, Loves Park, Ill. “Consumers are looking for functional ingredients to help manage their health.”
Launches of snacks containing functional ingredients like probiotics increased by 27% from 2016-18, especially in the bars, crackers and cookies categories, according to Innova Market Insights.
Protein is still one of the biggest drivers for better-for-you (BFY) snacks, but plant-based protein is taking the market by storm. Several studies show that consumers prefer more snacks made with plant vs. animal protein, and producers are innovating by swapping perceived less healthy ingredients for more nutritious alternatives.
Clean labels with simple, organic, “real food” ingredients and no preservatives also appeal to health-conscious consumers. Free-from products with no gluten, reduced sugar and sodium, and fewer carbs support popular commercial diets and self-imposed healthy eating habits.
Healthy eating is influencing other snacks as well. Early on, Rudolph Foods, Lima, Ohio, vowed never to change its pork rind recipe. However, times have changed.
“We understand that our customers want a BFY pork rind, so we lowered the salt and fat and created our signature black bags highlighting our claims,” said Mark Singleton, vice-president of sales and marketing, Rudolph Foods.
All generations want snacks claiming health benefits beyond basic nutrition, but there are differences between age groups. Innovation should appeal to different age demographics.
“Producers must recognize preferential differences among generations when it comes to specific product attributes and ensure targeted messaging when marketing to these age groups within channels,” said Sally Lyons Wyatt, executive vice-president and practice leader, client insights, I.R.I.
Craving permissible indulgences
While healthier options specifically entice younger generations, indulgent offerings are still important across the board. Offering thin snack formats or smaller portions of less healthy snacks can create a guilt-free indulgence.
“There’s no one-size-fits-all when it comes to snacking as consumers don’t always select one snack for all occasions,” said Jared Johnson, vice-president of insights, analytics and category management, Frito-Lay, Plano, Texas, a subsidiary of PepsiCo. “Snacking is all about balancing snack choices, and at Frito-Lay, we strive to provide consumers multiple snack choices.”
Indulgent flavors combined with more permissible ingredients influence snack choice. Consumer preference for birthday cake-flavored snacks exploded with 64% growth over the past year, according to I.R.I. Bitter and butter flavors are an emerging trend, and peanut butter re-appeared in more snacks this year.
“Consumers are increasingly ‘snacking on air,’” Mr. Vierhile said. “Snack companies are keen to create chips and puffed snacks with a thin, airy texture. Innovation with hybrid snacks like clusters and poppers provide novel textures.”
Snack producers offer consumers the best of both worlds by developing indulgent snacks in innovative new formats.
Purchasing and consumption behaviors have shifted. Consumers are adding to the ways they shop for food. They are increasingly looking for snacks online, or through click-and-collect and delivery services. Understanding these behaviors can help drive growth.
“In the past, there were two ways consumers purchased and consumed snacks, ‘planned’ and ‘impulse,’” Ms. Lyons Wyatt said. “We have now identified two additional factors, ‘on-demand’ and ‘experiential.’ Producers must consider all four factors when innovating and marketing products.”
Getting snacks in the hands of consumers is vital. Producers must reach them in the places they frequent such as airports and gyms.
“Food as medicine continues to be a trend. Consumers are looking for functional ingredients to help manage their health.”
Kim Holman, Crunchmaster
“Snacks are even showing up in the back of Ubers,” said Jared Koerten, industry manager, food and nutrition, Euromonitor International. “Using your smart phone, passengers can purchase snacks in the tray and fulfill their craving while they ride.”
Pop-up dining experiences offer a culinary adventure, engaging the consumer and increasing brand awareness. Similarly, snack availability generates more snacking occasions, increasing opportunity for more experiential snacking, which excites consumers and drives consumption. Limited-time offers and specialty branding can effectively create this experience.
“Last year, Utz was proud to become the Official Salty Snack of Major League Baseball, opening up a number of new and exciting co-branded product offerings,” said Kevin Brick, senior vice-president, marketing, Utz Quality Foods, Hanover, Pa.
Shelf-stable products are evolving to be fresher, and distribution models are allowing them to get directly to the consumer faster. On-the-go consumers don’t want to prepare meals after work. Innovation with fresh, “real food” options like adult snack trays and combo packs can help producers compete.
Right package, right place
Price, packaging and convenience all influence consumer choice. Price is the No. 1 factor guiding consumer shopping habits, according to I.R.I. Product labels and packaging ranked third.
“Packaging can be a really helpful tool when introducing shoppers to new snacks that fit their needs and lifestyles,” Mr. Briones-Sanchez said. “We use price and size as levers to drive trial and encourage consumers to buy new snacks.”
Packaging tends to influence older consumers more often than younger, possibly because younger consumers shop more online, according to I.R.I. Producers will do well to put as much messaging on the front of packages, which will appear in product images online.
“Our goal is to ensure our packaging makes it easy for consumers to see what’s most important to them,” said Suzanne Ginestro, chief marketing officer, Quest Nutrition, El Segundo, Calif. “The front panel features large and craveable food imagery to help consumers find the flavor they’re looking for quickly. There are key nutritional callouts that highlight and reinforce Quest’s promise of protein and fiber, low sugar, and low net carbs.”
Snack manufacturer’s strategic use of channels combined with effective packaging is more important to reaching consumers than ever before.
“Shopping online removes the opportunity for the unplanned purchase,” Mr. Koerten said. “To drive impulse buying online, producers can offer incentives to increase the number of purchases or encourage additional purchases. Subscriptions can also potentially generate growth.”
Automated subscription orders provide a convenient way to purchase shelf-stable bulk items like bars. For indulgent snacks, subscriptions allow customers to try something new each month as a treat or occasional indulgence, billing snacks as artisanal and unique.
Success in the current snack market requires balancing BFY with the taste people expect, while getting them the snacks they love in new, exciting formats. If those factors can be achieved, the sky still appears to be the limit for the snacking industry.
This article originally appeared in SNAC International's 2019 Official State of the Industry.