CHICAGO -- The U.S. consumer packaged goods (CPG) industry registered its strongest growth in four years in 2015, and companies targeting the fast-growing market for protein-rich foods and healthy, “mindful” snacks achieved some of the biggest gains, according to new research by The Boston Consulting Group (BCG) and Information Resources Inc. (IRI).
The trend was particularly noticeable among small and midsize companies, which continue to seize market share from larger CPG competitors. Quest Nutrition, Bai, Kind and Sargento Foods, makers of mindful snacks, are among the companies with annual sales of less than $5 billion that ranked among the CPG industry growth leaders in 2015.
Consumers are still finding opportunities to indulge. A number of large, high-performing CPG companies derived most of their 2015 growth from product categories such as confections, ice cream and alcohol beverages, according to IRI data. Most of these companies, however, also are introducing health-focused foods and beverages.
“Our research confirms that consumers’ desire for more healthful eating remains a powerful trend that packaged-foods companies can’t ignore,” said Jim Brennan, a BCG partner and co-author of the study.
The research revealed that in 2015, U.S. CPG sales rose by 3.1% to $670 billion, a pace last achieved in 2012. Also, small companies (those with less than $1 billion in sales) and midsize companies ($1 billion to $5 billion) accounted for 46.4% of total CPG sales, a 0.5 percentage-point gain since 2014 and 2.7 percentage-point gain since 2011. That translates into an $18.1 billion shift in market share during the past four years. This growth by small and midsize companies was driven largely by their ability to gain wider distribution for their products, according to data from Chicago-based IRI.
Small and midsize companies that target consumers’ quest for protein are among the best performers. Quest Nutrition, whose leading products include protein bars, powder, chips and shakes, is the top-performing small company on the BCG-IRI list.
Some makers of mindful snacks that promote health and wellness also made best-performer lists. Bai is a maker of low-calorie, antioxidant fruit drinks infused with the outer layer of coffee berries. Kind makes whole-grain bars and clusters. The growth of Sargento, a top-performing midsize company, is driven by its Balanced Breaks brand fruit, nut and cheese snacks.
Most of the best-performing large companies also offer healthy foods and beverages, but much of their growth is still driven by consumer indulgences. Strong sales growth in M&M’s chocolate, Juicy Fruit gum and Dove chocolate and ice cream helped make Mars a leading performer in 2015, and ice-cream makers Ben & Jerry’s and Breyers were major contributors to sales growth at Unilever, according to IRI data.
The findings are based on the fourth annual analysis by BCG and IRI of the growth performance of more than 400 CPG companies with annual U.S. retail sales of more than $100 million. The study focused on what consumers actually bought in measured channels as opposed to what factories shipped. It ranked companies on a combination of three metrics: dollar sales growth, volume sales growth and market share gains.
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