Snack sales stay splendid.
Among the consumer trends affecting snack sales is a movement toward smaller, more frequent, and lighter meals. Not only do packaged snacks please the palate, they're also highly totable, which makes them a perfect fit for the new-style meal patterns.
New products always invigorate the snack market, and several innovative introductions have consumers munching away. For potato chips, which account for half the category, new items went back to this treat's "roots" for inspiration. Termed "textural segmentation" by industry marketers, the phenomenon that has consumers emptying chip bags in half the time is the thicker potato chip. This item's appeal lies in its hearty, more potato-y flavor designed to recall the good old days.
The new-style chip has found a niche among snack lovers with a penchant for "old-fashioned goodness and nostalgia," says Raymond Riss, vice president of marketing for Borden's snack group which recently introduced its Cottage Fries thick chip under the Wise label. The premium chips are packed in a foil pouch with colorful graphics depicting a "homey" scene. "When you think of high quality, you think of the good old, pre-preservative days," says Riss, explaining the marketing philosophy behind the thick potato chip. Cottage Fries are available in four flavors: regular, barbecue, cheddar cheese, and, in limited markets, a no-salt variety.
PepsiCo's Frito-Lay division has jumped into the thick of the textural segmentation battle with O'Grady's Extra Thick & Crunchy style potato chips. Backed by a $25 million total advertising and merchandising campaign, O'Grady's potato chips were years in development. Frito-Lay invented a unique method of slicing potatoes to achieve a thick chip thta still breaks up easily in the mouth, according to company spokesperson Elliot Bloom. Apparently, the thicker the chip, the harder the results after frying, necessitating some technological wizardry to produce a snack that's crunchy but that doesn't crack the teeth.
Although consumers seem to be clamoring for light products these days, thick, down-home style potato chips found an immediate niche among consumers. Bloom says research revealed a significant market segment primed for a hearty-style potato chip. Tagged the "more potato potato chip" in TV spots, O'Grady's, which are 100% natural, come in a regular variety plus au gratin, a cheese-seasoned style. They are already 10% ahead of sales projections, says Bloom.
Earle Ingalls, product director of chips & snacks for Nalley's Snacks, says the company's low-sodium Golden Lights potato chips introduced last year are doing well. "It's a steady piece of business for us," says Ingalls. "People's tastes are unquestionably chaning." Nalley's, which serves the Northwest region, is working on more new snack items slotted for introduction later this year.
Realizing that few things team up better with snacks than beer, brewer Anheuser-Busch has entered the market with a line of pretzels, potato chips and nuts under the name of Eagle Snacks. A national rollout is underway, with more items such as tortilla chips to be added.
Nowadays, Mexican food is "hot" in every sense of the word, and the craze for south-of-the-border fare is probably partly responsible for heating up the tortilla chip market. Particularly popular in the West and Southwest, where they are often cross-merchandised in supermarket delis, these crunchy snacks gained about 15% in 1983 and are secoond only to potato chips in category share and sales. Chipper/Snacker Food Association, projects that these treats will soon hit the $1 billion sales mark.
Pretzels, down in recent years, are also on the rise as are pork rinds, which, according to Chipper/Snacker, were up 10% in 1983. Premium popcorn
What designer labels did for blue jeans, "gourmet" flavorings seem to be doing for popcorn. Spurred by gourmet popcorn shops where shoppers can order the snack in a variety of exotic flavors, specially seasoned bagged popcorn is taking hold in supermarkets, as well. One recent entry is The Original Popcorn Cuisine line produced by Pioneer International Foods. The all-natural butter-flavor variety, packed in foil inside a poly-bag, retails at $3 for 8 ounces. Positioned as more of a gift item (if comes with an all-purpose gift tag), the firm's "three-pack carrier" item sells for a hefty $10. Inside the specially designed carton--which won a Gold Award from the Paperboard Packaging Council--is stashed pouches of French onion, jalapeno, and Swiss honey almond popcorn. According to Lou Hallacy, assistant sales and marketing director, "Other flavors are in the works." The new popcorn item is nationally available and will be sold in upscale supermarkets, department stores and specialty shops.
Pioneer International President Paul Porvaznik says of his new popcorn endeavor, "We found a way to carve a niche in the snack market by creating a different product, recipe and packaging concept. We use only the highest grade popcorn and highest grade seasoning," he adds, asserting that today's consumer wants to indulge in certain premium food products.
Virginia Blair, public relations director for the Popcorn Institute believes popcorn's popularity is growing these days because more consumers are recognizing that it is nutritious, low in calories (without the butter), high in fiber, and inexpensive. Blair credits the proliferation of popcorn-making gadgets, especially the hot-air type that requires no oil, for the snack's surge in consumer acceptance.
Consumers are also eating fewer main meals, and as a result, are turning to snacks to tide them over. "Nowadays, people are learning to make snacks work for them," explains Blair. "They don't have the time or the inclination to eat four- or five-course meals."
Popcorn has also tumed out to be a dieter's best friend. Minus butter, it's an approved snack on the Weight Watcher's maintenance diet, and it's also "legal" fare on many.
Merchandising opportunities for popcorn might include diet food section tieins. And October is national popcorn month and the perfect time for armchair quarterback and Halloween treat tie-ins, Blair says.
Snack packaging is also undergoing some rapid and much-needed changes these days. In addition to the foil pouch which can ensure freshness for up to six months, another packaging innovation to hit the supermarket shelves is the canister pack. Raymond Riss says Borden's cheese puff snack items are being marketed in canisters with a new metalized foil seal beneath the plastic lid. P&G went to all singles (canisters) for the Pringle's line and introduced Pringle's Cheez' ums last year.
And to get the canisters out of the "low profile" bottom shelf position to which they're often relegated, Borden's has also developed a special plastic merchandising unit. The gravity-fed unit is made of day-glo orange plastic and can be used as a freestanding rack, end-aisle display, or in the snack aisle. Resealable bag
Keeping snacks fresh after opening has always been a source of frustration to consumers. "Research shows consumers have tried everything from paper clips to clothespins," says Riss. Borden's hopes it has solved the problem with a new packaging innovation now being introduced. It's a resealable bag that utilizes a "peel and seal" strip to keep snack contents fresh.
Also on the horizon for snack packaging is nutritional labeling, according to Chipper/Snacker Editor Crystal Craft. Before the government forces compliance, she says, snack manufacturers are going to put this vital information on their labels voluntarily.
With single-serving packages a significant portion of the snack business, supermarket operators might take advantage of cross-merchandising opportunities in their in-store take-out areas and salad bars. More consumers, especially working women, after-five shoppers and singles, are looking for ready-to-eat meals. Snacks positioned near departments catering to these special customers could help build extra profits.