10 minute read
FEATURE: SALTY SNACKS
Satisfyingly salty
Snackfoods are a crucial part of the mix for convenience retailers, with salty snacks such as chips, nuts, jerky and rice leading the category’s growth.
Words Deb Jackson
ACCORDING TO THE 2023 Australian Association of Convenience Stores (AACS) State of the Industry Report, the Snackfoods category has shown the largest percentage growth of all categories within the convenience channel for the second year running.
After being the number one percentage growth category of 2022 at 29 per cent, Snackfoods has maintained its strong performance in 2023, adding an extra $115m in value over the last two years or 60 per cent from $193m in 2021 to $308m in 2023.
Theo Foukkare, CEO of AACS, highlighted that within the wider Snackfoods category, salty snacks have been leading the growth for the past two years.
“Chips, which make up the bulk of sales, continue to drive the growth up 24.1 per cent and are responsible for 85.6 per cent of total category sales, while nuts, jerky and rice snacks delivered the largest percentage growth for 2023, up 26.4 per cent after growing at 18.4 per cent in 2022.
“The only salty snack that slipped in 2023 was popcorn, which declined by 4.1 per cent after having seen significant growth in 2022. Its share of the category declined from 2.4 per cent to 1.8 per cent,” says Foukkare.
Ben Faulkhead, Category Manager at APCO, said they have observed the strongest growth within the premium chip space.
“Some of this has come at the expense of more of the mainstream brands especially in the entertaining/large bag area. Unit sales on larger entertaining SKUs have been in decline, but we have seen some small growth in self-consumption bags, again driven by brands such as Red Rock Deli and Kettle.
“Price has been a big consideration for shoppers as we have certainly seen a trend towards downtrading in size as shelf and promotional price has increased,” he says.
Speaking of size, Pringles recently proved that size doesn’t matter, announcing it would be downsizing the size of its cans in a bid to reduce 37,000kg of packaging per year in Australia and New Zealand.
The reduction in the can height of its 53g varieties is a move in Pringles’ next step towards its sustainability goals, but the company assured fans that the amount of chips within each can would remain unchanged.
Dan Bitti, Head of Salty Snacks at Kellanova, said Pringles has a distinctive and iconic can, but the company is committed to finding ways to minimise its environmental footprint.
“We’re excited to introduce revamped cans delivering the same snack with less packaging,” says Bitti.
As part of Pringles’ ongoing efforts to improve sustainability, the plastic lid was removed from the 53g can in 2022. Looking ahead, Pringles is working towards developing more sustainable packaging across the Pringles range.
Convenience matters
Soren Madsen, National Account Manager at Trumps Foods, says the petrol and convenience (P&C) channel is of huge importance strategically for Trumps’ range of grab-and-go snack foods.
“Our top volume lines are all roasted and salted snacks across the Snacks to Go range in our convenient snack cups, accounting for approximately 70 per cent of our volume. When we look at hang-sell pillow packs, the trends very much reflect similar percentages,” he says.
Madsen highlights that while there has been a shift towards healthier choices across snacking options for Australians, he believes that salty snacks will continue to hold their place as the main growth driver within the P&C channel.
“The salty snack remains as the constant go-to in the P&C sector, whether it be in a convenience size or the larger home consumption packs. A significant change in the offerings in the P&C channel is certainly heading towards the healthier/alternative to salt and sugar, but I firmly believe that sugar and salt will remain number one.”
But that doesn’t mean that there aren’t additional opportunities within the snack foods space, as Madsen points out.
“We have seen the dried beef/Biltong variants explode from the supermarkets and into the P&C space; this will continue for the rest of this year at a minimum. From our perspective, growing the valueadded segment will be our focus to bring out new and exciting flavour options,” he says.
For Jack Mortlock, General Manager at Chief Nutrition, the P&C channel has provided a significant opportunity for their Beef Bar range, which is up 500 per cent year-on-year within the sector.
Mortlock attributes this growth to a shift in consumer preferences towards better-for-you snacks, along with an increased demand in snacks that cater to a wider range of dietary needs and lifestyles.
Price has been a big consideration for shoppers as we have certainly seen a trend towards downtrading in size as shelf and promotional price has increased.
- Ben Faulkhead, Category Manager, APCO
“If you had told me three years ago that the P&C channel would be our most significant insofar as total doors, I would have been surprised. Three years on, around 25 per cent of all our doors are in the P&C sector,” he says.
“The P&C channel has always been a strong avenue for the sale of snacks, and now as consumers are becoming more health-conscious, the channel must continue to update its retail offer to include these in-demand products.
“Healthy snacking is a trend that continues to grow in Australia, as consumers become more aware of what is beneficial in a product and what to avoid, they are actively seeking out products that won’t just tide them over until mealtime but will provide nourishment and sustenance.
“Trending snacks in the meat category include jerky, biltong, and sausage snacks. Hence, our high protein range, particularly our Beef Bar, lends itself to the meal replacement market, where this market is forecast to grow at a CAGR of nine per cent from 2021 to 2026, seeing the greatest growth in the AsiaPacific market,” says Mortlock.
Likewise for Luke Rathbone, Co-Founder of Barbell Foods, the P&C channel is one that has proven to be a great opportunity as consumers become more convenience focused. →
“Our air-dried steak, aka biltong range is our best performing product. Most brands are targeting South African expats or jerky lovers but we're helping to encourage new customers to the category who don't like jerky or who've never heard of biltong before,” explains Rathbone.
“We've noticed more new customers coming to the salty snack category who are after healthy, on-the-go protein snacks. In this category, meat snacks have traditionally catered to ‘macho men’ but we're seeing more health-conscious customers.
“Our mini meat sticks were recently launched in a range of P&C stores around the country – they’re bite sized and super easy to eat on-the-go and they're also our best value for money product. We also use kangaroo meat in the meat sticks as consumers know this to be a lean and healthy source of protein with a low carbon footprint,” he says.
“It's tempting to follow the crowd, but you've got to be brave enough to know what your brand and product is about so that you appeal to your target customer – if you pretend to be something you're not, consumers will see this.
“All things considered, whatever your product or brand offers, you must aim to maximise the value for your customers. The more value you can provide, the more you will benefit in the long haul.
The salty snack remains as the constant go-to in the P&C sector, whether it be in a convenience size or the larger home consumption packs.
- Soren Madsen, National Account Manager, Trumps Foods
“Our air-dried steak, aka biltong range is our best performing product. Most brands are targeting South African expats or jerky lovers but we're helping to encourage new customers to the category who don't like jerky or who've never heard of biltong before,” explains Rathbone.
“We've noticed more new customers coming to the salty snack category who are after healthy, on-the-go protein snacks. In this category, meat snacks have traditionally catered to ‘macho men’ but we're seeing more health-conscious customers.
“Our mini meat sticks were recently launched in a range of P&C stores around the country – they’re bite sized and super easy to eat on-the-go and they're also our best value for money product. We also use kangaroo meat in the meat sticks as consumers know this to be a lean and healthy source of protein with a low carbon footprint,” he says.
“It's tempting to follow the crowd, but you've got to be brave enough to know what your brand and product is about so that you appeal to your target customer – if you pretend to be something you're not, consumers will see this.
“All things considered, whatever your product or brand offers, you must aim to maximise the value for your customers. The more value you can provide, the more you will benefit in the long haul.”
Path to purchase
According to Foukkare, there is a pretty even split between males and females who are purchasing snackfoods through the convenience channel, with males making up 55 per cent and females 45 per cent of sales. The generational split is also quite evenly distributed – so how can retailers capture the widest range of shoppers?
When offering advice to retailers, Madsen from Trumps Foods says that consumers are always looking for new and innovative snacking options, and trial and experimentation will be driven through the P&C channel.
“P&C is such an important space as online shopping continues to be popular for major retailers; the speed to market on more impulse/portioned convenience sized products will be more driven in the P&C channel more than ever.
“Smaller portion control packs need to be located near the POS to be effective, with grab-and-go in those ready meal/on-the-go alternatives as an added/impulse sale, and the medium to larger packs within the baked/fried chip/dried meats section should typically be on a gondola,” he advises.
“In 2024, suppliers should focus on exciting new developments to remain fresh and relevant in that salty space. Continuing to put the same nuts and mixes in a bag are no longer sufficient to keep shelf space – we may see collaborative combinations driving that impulse sale.”
With new products and limited-edition releases constantly hitting the market, APCO’s Faulkhead has given us these insights into what drives decisions when choosing which salty snacks to range in-store.
“The last 12 months have shown that flavours that are really different from the traditional snacking chip flavours have been strong NPD performers. I think it’s important for suppliers to continue to drive their social media marketing to generate hype on NPD, but ensure it is timed in-line with when the product is actually available for purchase in-store.
“Price is still going to be incredibly important as we move through the rest of 2024, and I think price is going to be a really big consideration for shoppers in our stores.”
