By Pat Pape
Once upon a time, the word “snack” referred to any food consumed between meals, often as a treat and for the enjoyment of its taste. But snacking has changed. Today, the simple snack plays a variety of roles in the busy American lifestyle — a meal replacement, an energy booster or a bridge between meals that probably don’t occur on a set schedule.
Snacking continues to grow in importance, according to the Snack Foods Culinary Trend Mapping Report from the Center for Culinary Development (CCD) and Packaged Facts, and as a result, consumers want a bigger bang for their snack buck, including more flavor, higher-quality ingredients and enhanced nutritional value. “We want our snack indulgence, but we want something healthful because our snacks are doing a bigger job,” said Kara Nielsen, CCD trendologist.
The growth in snacking will continue through the next decade. The NPD Group, a market research firm that tracks American eating patterns, predicts that between 2008 and 2018, morning snacking will jump 23 percent, afternoon snacking 20 percent and evening snacking 15 percent.
When it comes to sweet snacks, overall consumption is expected to increase 14 percent during that 10-year period.
7-eleven offers customers more than 225 private-label products, and added 15 new packaged bakery items to its offerings in October.
The introduction of new snack foods and continued changes in American eating habits are the two main reasons behind that projected growth, according to NPD.
Most parents prefer to see their children noshing on healthy, low-calorie foods, and the majority of consumers want to eat right as well. Survey results from market research firm Mintel show that 65 percent of adults say that they’re interested in consuming healthier snacks, such as whole grain or baked items. However, half of those survey respondents also admit that the low-fat, low-sodium snacks lack the same yum factor as the original versions.
“Consumers want products that are healthier, fresher, satisfy their hunger, taste great and are easy to eat on the go,” said Kathy Kemmet, director of new product development, Immediate Consumption Channel, for Kraft Foods. “This is especially true with Millennial consumers [Generation Y] and Gen X.”
Manufacturers have responded by introducing portion-control packages, such as 100-calorie bags of snack items. Others are promoting the presence of more nutritious ingredients, such as fruit or flax seed.
One example is the California-based grocery chain Trader Joe’s, which started out as a small convenience store chain in 1958. The stores are selling Brown Rice Marshmallow Treats made with organic brown rice syrup and organic evaporated cane juice that are gluten free and contain only 100 calories per bar. Trader Joe’s also sells containers of dark chocolate-covered edamame (soybeans) that have received rave reviews from customers.
“This trend is here to stay,” Nielsen said of the health-focused treats. “We’ll see more variety, more options on both the savory and sweet side. What I’m seeing most is all-natural products without artificial ingredients. Of course, that also means a shorter shelf life.”
While parents prefer that their youngsters consume better-for-you food products, it doesn’t always work out that way, according to Iven Sharrak, owner of 13 Detroit-area convenience stores, all part of Paramount Acquisitions.
“I see a lot of people moving away from regular Twinkies and going for granola and PowerBars,” said Sharrak, an admitted fan of Little Debbie Wafer Bars. “But when parents come in with kids, they buy what the kids want.”
Everyone is in a hurry, and everyone gets hungry, especially in the morning. “We have data that confirms that over 60 percent of moist bakery and snack cakes consumed in c-stores occurs in the morning between 5:00 and 11:00 a.m.,” said Kemmet. “The top morning packaged forms include donuts, muffins, cinnamon rolls and Danishes.”
Vonnie Gormley, senior associate, consumer insights, General Mills Convenient Solutions Team, agrees that the a.m. commuter rush is the ideal time to promote packaged snack products. “Retailers can take advantage of the fast grab-and-go breakfast trend and capitalize on the healthier items,” she said.
That’s no surprise to the team at NOCO Express convenience stores, a 30-store chain with headquarters in Tonawanda, New York. “We see this all the time in the morning,” said Pat Zelechoski, category manager for NOCO Express. “We see people grabbing the lower-fat Fig Newtons and the Snackwells. I’m not sure if they like them better or just feel good about buying them.”
Whether customers prefer the taste or the products’ better-for-you attributes, one thing is certain: They love the convenience. “Recent research tells us that consumers are seeking convenience and portability when they purchase [snack] products,” said Mike Morrissey, Kellogg Company spokesperson. “According to an Information Resources Inc. survey, 41 percent of consumers look for snacks that can be eaten in the car or on the go.”
With the current economic climate, U.S. consumers want more value for every dollar they spend. Information Resources Inc. reports that 44 percent of shoppers will seek out private-label store brands in order to save money, and 52 percent plan to do so in the coming year.
Private-label consumer packaged goods (CPG) now represent more than 17 percent of all CPG purchases. The private-label dollar share is growing in all income segments, with the strongest growth coming from middle- and upper-income consumers.
7-Eleven, the Dallas-based chain with more than 7,900 North American locations, offers customers more than 225 private-label products under the brand name 7-Select. In October, the company added 15 new packaged bakery items to its private-label offerings, including mini-powdered donuts, honey buns and Danish pastries in a range of flavors.
“Our initial objective was to develop brands comparable to top-selling national brands at a better cost to the stores, a better price for customers and a better gross profit for our franchisees,” said Tom Gerrity, senior product director in charge of private label for 7-Eleven.
Gerrity recognizes that national suppliers have concerns about retailers introducing private-label products to store shelves. “But customers who want the name brands will continue to buy them,” he said. “We try to have at least some amount of product at a lower price, and I believe both can co-exist.”
While things are changing in the packaged sweet snacks category, some things will always remain the same. Product line extensions continue to boost the sale of tried-and-true snacks, such as Oreo cookies from Nabisco. This year, the company unveiled the Oreo Brownie and Oreo Cakesters Peanut Butter Crème “to drive growth for convenience store retailers,” said Kemmet.
Hostess Twinkies have been a classic since their inception in 1933. At the time, they sold two for 5 cents, a bargain-priced treat for Depression-era pocketbooks. During the Cold War of the 1960s, there was widespread fear of a nuclear attack. Many bomb shelters were constructed and stocked with foods, including Twinkies, which were rumored to stay fresh forever. In reality, a Twinkie’s shelf life is 25 days.
Today at 100 calories each, Twinkies remain Hostess’ best-selling snack cake, with more than half a billion produced annually. “We still sell plenty of the Hostess-type products,” said Zelechoski of NOCO Express. “The age group varies, though I do see more men than women purchasing them.”
According to the NACS State of the Industry Report of 2008 Data, the gross margin on packaged snack cakes and pastries was 38 percent in 2008, up more than 2 percent over 2007. The gross margin on packaged muffins and donuts was up more than 1 point at 25.5 percent.
Sweet snack manufacturers have a variety of suggestions to help retailers move more merchandise. “Showcase different flavors and options and give consumers the opportunity to sample new offerings to encourage purchase,” said Catherine Porter, senior marketing manager for c-stores, at Sara Lee Foodservice. “Support product sampling with POP merchandising to help the consumer identify what it is they’re sampling. Finally, talk to a foodservice supplier. Many offer cost-effective ways to help brand and promote different products for different dayparts.”
Kemmet at Kraft believes shippers and pre-pack displays help draw attention to new snack items. “Merchandising displays and counter racks on the coffee bar are a great way to promote sweet snacks,” she said. “Bakery items and packaged snack cakes are consumed predominantly in the morning, and a lot of our [retail] customers look to bundle these sweet items with coffee to help drive sales during this key day-part. In-store signage and pump toppers are effective at driving awareness for bundle promotions.”
By keeping on top of evolving snack food trends, offering the right snacks for each daypart and merchandising them effectively, convenience operators can make the most of the viable packaged sweet snacks category as it grows through the next decade.
Pat Pape worked in the convenience store industry for more than 20 years before becoming a full-time writer.