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Fruit, nuts grow as snack leaders

BY Barbara White-Sax

Fruits and nuts as a category are growing. Across all three channels, dried fruit sales were up nearly 7 percent, but in the drug channel, the category had explosive growth of 30 percent for the 52 weeks ended Feb. 24, 2008, according to Information Resources Inc.

Drug channel sales in the nut category outpaced the three-channel average as well. Food, drug and mass dollar sales of snack nuts, seeds and corn nuts were ahead nearly 4 percent for the same period, while in drug stores the category surged 9 percent.

“Consumers are increasingly interested in unadulterated foods that have not been disassembled or processed,” said David Wright, senior communications associate at The Hartman Group. “Seeds and nuts eaten as snacks are perceived to offer a variety of positives, including being satiating, a source of protein and a source of ‘good oils’ and essential fatty acids.”

Nuts fit that profile. “Almonds are a great source of protein, they are full of antioxidant and they help regulate sugar levels,” said Kim Lopez-Walters, consumer strategist for food and beverages at Iconoculture.

“Almonds and walnuts, with their omega-3 benefits, will continue to grow as a snack segment,” she said.

Innovation lifts category

Innovation has helped lift the category. Last month, Diamond Foods began shipping its Emerald Cocoa Roast Dark Chocolate Almonds, nuts that offer the taste of chocolate without the added calories and fat found in chocolate-dipped nuts.

Because the flavor is roasted into the nuts, the nuts are shelf-stable and don’t require refrigeration. “Innovation is critical to expanding the nut category. Consumers who have a craving for something sweet in the past would not have been able to satisfy that within snack nuts,” said Andrew Burke, senior vice president of marketing for Diamond Foods.

New take on dried fruit

Lopez-Walters said manufacturers are also adding flavorings to dried fruit. She cited lightly salted apple chips or apples chips seasoned with chili or lemon as products that tempt consumers looking for healthy snack options into the category.

Dried fruits also are showing up in a variety of flavors. “As with fruit juice, dried fruits and berries that were once typically found only in specialty or health food stores are now becoming increasingly common,” Wright said, adding that such fruits as persimmon, figs, cranberries, blueberries, mangos and figs are becoming more common in the dried-fruit section.

Freeze-dried fruits also are getting more attention. “It’s a segment that’s gained traction, since the consumers are looking for snacks that don’t have added sugar and preservatives,” said Matt Betters, co-chief executive officer of Brothers International Food Corp., makers of Brothers All Natural Fruit Chips, including Fuji Apple Crisps.

The chips offer consumers two servings of fruit per one 10-gram package. The product contains no sweeteners or added flavorings, doesn’t require refrigeration and is shelf-stable for up to one year. “Our product offers the same nutritional value as fresh fruit, but it’s portable and nonperishable,” Betters said.

Betters said the company, which has product in Costco and other channels, is working with drug chains to develop clip-strip and other in-and-out programs that will allow the drug channel to test the product. “We’ll offer a clip-strip assortment of three to four flavors retailing at 89 to 99 cents a bag,” Betters said. “The broader flavor selection will allow drug retailers a way to offer something different from club stores, which typically limit flavors to two varieties.”

Can fresh fruit work?

Fresh fruits provide a greater challenge for drug retailers, but one that may be worth overcoming. Consumers continue to look for healthier snack options, and fresh fruit is one key area.

Ali Leon, director of fruit and vegetable corporate communications at Ready Pac, told attendees recently at the Produce Marketing Association’s Fresh Summit International Convention & Exposition that “today’s consumers are ‘fresh stressed,’ meaning they don’t have time to shop for and prepare fresh produce, yet they are constantly seeking ways to better themselves by what they eat and drink.” Leon said the increased good-for-you health consciousness is creating more demand for fresh convenience snacks.

“Fresh fruit is the third-most popular snack among men and women, behind gum and chocolate candy,” he said.

Ready Pac’s Ready For You grab ‘n go program of single-serve, fresh-cut fruits packaged in clear containers provides consumers with premium fresh-cut fruit in a personal 6-ounce cup that can fit in a car cupholder. Fruit medleys include grape, blueberry and cantaloupe; kiwi, strawberry and mango; and super fruit medley.

Ready Pac also offers ready-to-eat snacks in its Just Snackin’ line, with such combos as apples and fat-free caramel dip; apples and peanut butter dip; celery and peanut butter dip; and carrots and celery with ranch dip.

Del Monte Foods’ Fruit Naturals, fruit in a yogurt-sized package, have taken off dramatically over the past three years, according to Xander Shapiro, senior brand manager of produce and fruit business development for the company. “We’ve had more than 20 percent annual growth and launched six new items over the past 18 months,” he said.

“We believe there’s a great opportunity for drug stores to grow ready-to-go refrigerated fruit offerings,” Shapiro said. “While 4-ounce fruit cups on the regular dry goods food shelves are a great item for kids, most adult consumers tell us they don’t find a small kid cup enough fruit to satisfy them. That’s where Fruit Naturals come in.”

Shapiro said Del Monte recommends drug stores with limited shelf space focus on three to four differentiated offerings, using the same approach they employ to maximize the mix in yogurt and health beverages.

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Pepsi switches marketing gears for Gatorade, Tropicana

BY Jenna Duncan

CHICAGO Marketing efforts for two of PepsiCo’s major brands, Gatorade and Tropicana, will fall into new hands, the company said yesterday. The Arnell Group of New York will now handle Tropicana and TBWA\Chiat\Day of Playa del Rey, Calif., will take on Gatorade, moving marketing out of the hands of Element 79, the company said. Both of the new groups, as well as Element 79, are controlled by Chicago-based Omnicom Group.

“We’re always looking for breakthrough creative, and … are continuously assessing performance from incumbents, as well as other agencies,” the company said in a statement released yesterday.

PepsiCo reportedly spent more than $180 million on its U.S. media campaign for Gatorade last year and almost $30 million on Tropicana, according to a report by Nielsen Monitor-Plus.

Element 79, which was created in 2001 to handle Quaker/PepsiCo after the company left Foote, Cone & Belding, also lost three other PepsiCo brands earlier this year: Lays, Propel Fitness Water and Tostitos. But they continue to handle Quaker cereal, rice and snack brands, covering such brands as Cracker Jack, Life cereal, Quaker brand oatmeal and other products.

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Milwaukee Brewers name Quench their official gum

BY Jenna Duncan

PRAIRIE DU SAC, Wis. Quench gum, marketed for its “thirst-quenching” flavors, will get an extra boost from American League baseball team the Milwaukee Brewers; the team has named Quench its official gum.

Mark Lutz, national sales manager for Quench, said, “We are thrilled to team up with the Brewers. Brewer fans are extremely loyal and their games are a big draw. It’s the perfect opportunity to support the home team and spread the word about Quench gum to a wide variety of people.”

Quench will be allowed exclusive marketing rights during the Brewers’ 2008 season at Miller Park and has planned several events for the summer, including giveaways like Quench Gum Night, July 25.

Mueller Sports Medicine is the maker of Quench gum, purported to help alleviate thirst because it has a tart flavor that stimulates saliva. In addition to its alleged prevalence among baseball players, Quench is also reportedly used by professional athletes in basketball, football, hockey, and even marathon runners.

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