LONDON -- The global pretzel market has been witnessing a steady growth due to vendors’ introduction of healthier variants of pretzels in a range of flavors. The presence of numerous players, especially private labels, has led to the availability of a wide range of brands and products.
Technavio analysts expect the global pretzels market to exceed $7 billion by 2020, growing at a compound annual growth rate (CAGR) of over 2%, according to its latest report.
“The demand for healthy snacks and rising disposable incomes will support the steady growth of the global pretzel market during the forecast period,” said Vijay Sarathi, lead analyst at Technavio for food research.
Technavio’s food and beverage market research analysts have identified the following five factors that will drive the global pretzels market:
1. More opportunities in snacks industry.
The savory snacks market is growing at an annual growth rate of 2%. Changing lifestyles and the growth of online shopping have made available a wider variety of snacks. Pretzels are the ideal choice for customers looking for healthy and convenient snacking options. In 2015, the company Snyder’s of Hanover, achieved sales of $434 million. Thus, rising snack consumption is expected to drive the market in the forecast period.
2. Rising number of private labels.
Private-label products are those that are manufactured and sold by the retailers. These have achieved significant growth over the last decade, both in size and in scope. Operational efficiencies allow retailers to price private-label products lower than branded ones.
As retailers expand into new regions and develop more of their own private-label products, the visibility of these products will increase and consumers will get to choose from a wide array of options. Existing brands will also face increased pressure to reduce costs and differentiate their product offerings. The increased presence of private-label “good-for-you” products and gourmet varieties has further boosted consumer interest and confidence in these labels.
3. Rising demand for ready-to-eat (RTE) foods.
Growing personal and professional demands leave many consumers with little to no time for cooking. This has fueled the RTE food segment and, consequently, the pretzel market. RTE products are readily available for immediate consumption and can be resealed for future use.
These features especially appeal to the millennial consumers. Novel packaging in convenient sizes has added to the appeal of RTE products. Pretzels are considered healthier than other typical snack items like potato chips, as they combine health, taste, and convenience. They are available in flavor profiles that range from bacon and cheddar to maple, caramel, and peanut butter.
4. Healthy snack alternative.
Pretzels are widely considered to be healthier than other conventional snacks. Although they are high in sodium, they have negligible fat content. The flour used to bake these is often fortified with iron, vitamins, folate, and other essential nutrients, which purportedly aid digestion and boost metabolism. Some newer launches even contain healthier ingredients, like multigrain flour, which contribute to the products’ fiber content. Manufacturers tend to highlight these attributes while marketing their products.
“An increasingly health-conscious populace has triggered the demand for healthier snacking alternatives, especially low-fat, low-calorie options,” says Vijay.
5. Rising number of varieties and flavors.
Most leading vendors have introduced a multitude of flavors and variants of pretzels. For instance Auntie Anne’s offers soft pretzels in a wide array of flavors, including cinnamon sugar, roasted garlic and parmesan, and pepperoni. Its recent offerings, pretzel dips and cheddar-stuffed pretzel nuggets, have sparked consumer interest due to their novelty and uniqueness.
Packaged pretzels sold by Frito Lay range from Butter Checkers to Bagel Pretzel Rings. Among the soft pretzel categories, Pretzelmaker, a leading franchise of hand-rolled pretzels, offers more than 20 variations of pretzels, including salted, cinnamon sugar, ranch, and jalapeno.
The introduction of varieties and flavors is also likely to boost the market.
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