Snacks Overview

Samantha Oller, Senior Editor/Fuels, CSP

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Cookies Don’t Crumble

As recently as 2010, c-store cookie sales were continuing their descent into the abyss, with dollars off more than 6% and units down nearly 7%, according to SymphonyIRI. But look at 2011, and dollars rose 7%, with units up more than 5%.

Lance Smith, category manager for McLane Co., Temple, Texas, credits leadership by Kellogg Co. with its Keebler line—which includes Soft Batch chocolate-chip cookies and the new Cookie Combos in a 3-ounce bag—as well as Kraft Foods’ Nabisco lineup.

Crackers also grew c-store dollars and units yet again in 2011, according to SymphonyIRI, although inflationary pressures appear to be partly in play, at least on the dollar side. Here, Mars’ Combos fi lled crackers, Frito-Lay’s Munchies brand and Keebler’s filled crackers picked up dollar share while also seeing strong unit growth.

Commodity Crush

Just as candy has come under inflationary pressures over the past few years, snacks have seen increases partly driven by price jumps in corn, meat, soybeans and other commodities. According to fi gures from SymphonyIRI, salty-snack c-store dollar sales rose 6.9% in the 52 weeks ending Dec. 25, 2011, while units grew less than 2%.

Snack and granola bar dollars jumped 10%, with units up only 1.9%. Meat snacks, meanwhile, saw a 12.2% rise in dollars and 6.8% growth in units. Snacks containing corn may feel the increase the most. In a January 2012 report on chips, pretzels and corn snacks, Mintel International says, “In June 2011, the price of corn hit a record high of $7.99 a bushel. ... As recently as 2005, corn was selling for as little as $2 a bushel, which means that manufacturers must fi nd a way to balance an increase in production costs against consumers’ continued wariness regarding spending.” The report says that one approach has been to reduce package size to help minimize price increases, “with the hope that this will be less noticeable than dramatic cost increases.”  

$7.05 per bushel: Price of corn, as of February 2012. On the decline from August to December 2011, prices of corn have since rebounded, although they remain slightly lower compared to a year ago.   

Good for You!

While indulgent snacks have seen mixed sales over the recession, many healthy snacks have held their ground or grown. “We have seen, overall, very strong growth in nuts, seeds and trail mix,” says Smith of McLane. “Much of this can be attributed to being a healthier, good-for-you option in convenience.” C-store unit sales of snack nuts rose nearly 5% in 2011, keeping pace with 2010 growth, according to Symphony- IRI. Seeds’ unit sales grew more than 5%.

This has extended to snack bars; nutrition bars in particular continue to pick up momentum. Kelly Fulford, category development manager for General Mills Convenience, says consumers make purchase decisions according to the type of bar and the benefi ts it provides them. “C-store bar shoppers rate ‘bar type’ fi rst and brand second over all other attributes when making their bar purchase decisions,” she says. Fulford recommends retailers arrange bars by day-part, placing morning choices such as a breakfast bars near the top.

Convenient packaging, low price, portability

According to consumer research by Mintel International, more than two-thirds of “healthy snackers” say convenient packaging is the most important attribute for picking a healthy snack, followed by low price and portability. Meanwhile, portion-controlled packaging is described as “very important” to only 19% of these consumers. 

Meat Snack Attack

Meat snacks posted another solid year in c-stores, with unit sales up nearly 7%, according to SymphonyIRI. Smith of McLane credits an aggressive approach by Jack Link’s with bagged jerky, and says the company’s move into bulk as providing further expansion opportunities. He also cites ConAgra’s SlimJim in the meatstick segment as a growth leader. Jack Link’s and SlimJim each gained about a point in meat-snack dollar share in 2011, while SlimJim grabbed nearly 2 points in unit share, according to Nielsen fi gures.

Per McLane, shipments of meat snacks rose 10.8% in 2011, as measured by average shipments per store per week, with the jerky, nugget, tender and bite segment seeing the biggest gains. 

More than one-half According to proprietary research by Oberto Brands, more than one-half of beef-jerky purchases are unplanned. The primary purchase drivers of impulse purchases are fl avor and taste, while more than 35% of consumers who bought on impulse cited “store display caught my eye” as a purchase driver.   

New Chip on the Block

After Diamond Foods dropped its pursuit of Procter & Gamble’s Pringles potatochip brand, Kellogg Foods picked it up in February. Smith of McLane expects this “will be good for the c-store class of trade. Outside of Cheez-Its, [Kellogg] was not much before in salty snacks. They are a good marketer of brands, so I think this will be a win.”

Potato chips in general have enjoyed strong growth over the past few years, with SymphonyIRI pegging their 2011 c-store unit growth at 4.6%, driven largely by Ruffl es and growing distribution for Lay’s Natural. “It’s one of those items like candy where we’ve got an indulgent-type item people revert back to,” says Smith, who points out that chips also tend to be among the lowerpriced snack items in stores. 

9.1% The growth of total potato-chip sales from 2009 to 2011, reaching an estimated $7.2 billion for 2011. According to research firm Mintel, growth was fueled mostly the Lay’s Natural brand, which grew from $10 million in sales at food, drug and mass alone in 2009 to $527.4 million (estimated) in 2011. “As the FDMx (food, drug, mass, excluding Walmart) channel represents a significant percentage of total U.S. sales, a strong performance in FDMx can infl uence overall sales, which is illustrated by the potatochips segment,” Mintel reports.

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