Remember when snacks meant just chips or pretzels, and tortilla chips seemed a little exotic? Now when consumers want to snack, they have a plethora of choices ranging from rice cakes to freeze-dried fruit. Increasingly, those snacking options are better-for-you products.
“The market has completely diversified,” said Morningstar analyst Erin Swanson. “There are so many different options for consumers, and there’s no lack of healthy snacking products since that market has expanded.”
A recent study from Mintel suggested that even in this economy, consumers are trading up for more upscale, and often healthier, snack options — particularly when those products offer them something beyond a quick snack fix.
Christine Brown, marketing manager for Natural Snacks, said consumers are demanding more from their snacks than just an indulgence. “People want snacking to be an opportunity to fulfill nutritional requirements, such as a whole grain serving,” she said. “It’s not just a treat anymore.”
Natural Snacks new Jalapeno Puffs, baked puffs made with organic cornmeal, are an example of a better-for-you alternative to a traditional snack. Baked snacks have surged in popularity as consumers turn away from fried products with a high fat content. Healthier formulations combined with more adventurous flavorings give the product a distinct advantage.
Products made from corn, rice and nuts have become more popular. A recent study from Mintel reported that sales of trail mix and rice/popcorn cakes substantially grew in all three channels over the past few years, although those snacks still account for a small percentage of overall category sales.
Nuts also are being used in new ways. New nut chips and crisps made with pistachios or almonds, the Mintel report said, capitalize on the high nutrient value of nuts. Consumers can feel almost virtuous snacking on a chip that has a high fiber and antioxidant content. Frito-Lay’s True North Nut Crisps and Blue Diamond’s Nut Thins are two examples of successful nut crackers that offer consumers new snacking options.
Private-label brands are reflecting consumer preferences for interesting and healthier new products in their lineups. Mintel’s report said retailers’ private-label brands are competing head to head against traditional health food brands and better-for-you offerings from mainstream brands with their own organic and natural versions of popular snack foods.
Snack/granola bars are one example of a thriving category in which private label is making a dent. “Snack bars with fiber and yogurt with probiotics are examples of popular products that began with name brands but now have significant private-label competition,” said the report.
Increasingly, drug stores are making a push into the better-for-you snacks. Under its Deerfield Farms label, Walgreens markets Flax granola bars, as well as a number of dried fruit products. CVS’s Gold Emblem brand includes trail mixes as well as granola bars. The chain’s Crunchy Oats & Honey granola bars are merchandised head to head against Nature Valley’s version.
Duane Reade has done a terrific job with its DR Delish brand when it comes to products and packaging. Like other chains, the DR Delish product lineup features trail mix and dried fruit, but the chain had created some interesting trail mix crunches and included soy crisps. Clearly, the chain understands that consumers are looking for alternatives to potato chips. Walgreens, which is making its own foray into fresh convenience foods, will likely follow the Delish lead as it absorbs the Duane Reade stores after its purchase of the New York-based retailer.
Branded manufacturers — as well as private-label lines — will have to keep pumping innovative products with healthy profiles into the market to keep up with consumers’ increasingly sophisticated tastes and nutritional requirements.
Few chains have a stronger private-label program than Trader Joe’s, which can be a bellwether for new snacks. The chain stocks dried green beans, wasabi peas, honey plantain chips, and sea salt and pepper rice cakes. Can private-label versions of those products be on the horizon for drug stores?