It's crunch time

Years ago, a shopper looking to grab a savoury/salty snack for a movie night on the couch had a relatively simple decision that might have gone something like this: do I want a bag of chips—maybe plain, salt and vinegar, or ketchup—or should I grab these pretzels?

Today, however, the options are remarkably more diverse. New potato chip launches often feature upscale flavour combinations ranging from parmesan and roasted garlic to avocado and lime, while ready-to-eat popcorn might be flavoured with anything from tandoori and turmeric to cheddar and cracked pepper. And we’re seeing a wider variety of healthier alternative chips, including bean chips, kale chips, beet chips and more.

With all this innovation, sales have been booming, too. According to Nielsen data, popcorn sales rose by 6% reaching nearly $96 million in the past year, with flavoured popcorns (aside from butter or plain) up by 10% to $21 million in sales. Pretzels were up 4% to more than $48 million, “salty corn snacks” (such as tortilla chips) grew by 6% to $738 million, and potato chips rose by 4% to a whopping $1 billion in sales.

“It’s been the last few years that this has really ramped up,” says Giancarlo Trimarchi, CFO and controller at Ontario- based Vince’s Market, remarking on the proliferation of savoury snack options. “Everybody’s getting in on the action—from small artisan guys to medium-sized suppliers all the way up to the big national brands.”

Joel Gregoire, associate director of food and drink at Mintel, agrees. “While potato chips remain a popular option, the proliferation of formats and flavours in salty snacks is striking,” he says. “Salty snacks will always serve as an indulgent treat, but there has undoubtedly been a rise in the variety of better-for-you salty snacks.” While “better-for-you” often means lower in calories, he says, it could also refer to high protein, organic, “free-from,” probiotic, plant based—anything that makes it feel like a more “permissible indulgence.”

And consumers seem receptive to the many ways companies are making savoury snacks healthier. “One great example where we’ve seen tremendous growth in the last year is we launched an alternative line of chips that are cooked in avocado oil, which has healthier attributes that resonate with the consumer," says Kirk Homenick, president of B.C.- based Hardbite Chips, who notes his avocado oil potato chip line also reflects the trend toward upscale “foodie flavour profiles” in chips. “So we have a Black Sea Salt, a Sweet Ghost Pepper and a Honey Dijon, and we’re just in the midst of launching a Smoked Paprika and Garlic flavour .” Hardbite also launched a root vegetable chip line a few years ago, including beet, sweet potato, parsnip and carrot chips.

Similarly, Colorado-based Made in Nature offers organic chip alternatives including kale chips and coconut chips, as well as a new line called Veggie Pops— crunchy snacks made with organic kale, chickpeas, cauliflower, bell peppers, nuts, seeds and spices. “Our savoury product varieties like veggie pops and kale chips are a great alternative to something like a traditional potato chip, as they satisfy the salty and crunchy craving without any of the guilt,” says Brian Allen, vice-president of sales at Made in Nature. “Over the last couple of years, we’ve seen upward movement in veggie-based snacks and we believe this trend will continue as more consumers turn to plant-based diets.”

Who’s buying these better-for-you snacks? According to Neysa Davies, senior marketing insights manager at Mississauga, Ont.-based Tree of Life (which distributes a variety of savoury snack brands including Rhythm Superfoods’ kale chips and beet chips, Laiki’s rice crackers and the Good Bean’s crunchy legume snacks), it’s consumers of all ages. “Better-for-you snacks have typically held an assumed demographic with the on-the-go millennials. But as the category evolves, distribution broadens and consumers become more informed, so does the demographic,” says Davies, noting that the attributes of many of these snacks—including clean, high-quality ingredients and a focus on satiation—seem to speak to everyone from young families and millennials to baby boomers.

Innovation in both healthier options and creative new flavours isn’t just coming from the smaller players—even the traditional giants such as PepsiCo and Conagra are getting in on the action. As Rita Bajzelj, brand manager, total popcorn at Conagra Brands explains, health-related trends that may have started in “natural foods” are now, undoubtedly, mainstream. “For example, Orville Redenbacher Microwave Popcorn optimized its formula and now has no artificial colours, flavours or preservatives. The change helped to bring lapsed consumers back not only to the brand but to the entire microwave popcorn category,” she says.

Orville Redenbacher also launched its new Simply Salted flavour in late 2018 that is certified vegan, “so we are happy to have an option for every consumer now,” says Bajzelj. And Conagra also has the Angie’s Boomchickapop brand, whose ready-to-eat popcorn line is “Non-GMO certified with nothing artificial, and offers not only delicious popcorn favourites such as Sweet & Salty and Sea Salt, but also more indulgent flavours such as Caramel Cheddar,” she says.

Jill Hong, director of consumer insights at PepsiCo, confirms flavour is a key driver, as younger Canadians look for more variety and the growing ethnic population looks for more intense flavours. “Frito-Lay has been expanding to meet these ever-increasing desires through innovations like Cheetos Flamin’ Hot, Ruffles Sweet and Spicy, Miss Vickie’s Jalapeno and Lay’s Poppables Honey BBQ,” says Hong, who adds that Frito-Lay also offers several better-for-you options, including Tostitos Multigrain, SmartFood Delight (a lower-fat version of Smartfood popcorn), and lower-sodium versions of Lay’s Classic, Tostitos and Ruffles Regular.

With all the new players and products in the category, combined with the fact that traditional big-name salty snack brands are still big sellers, things can get tricky when it comes to shelf space. “As all these new products come in, your main line sections naturally start to get chopped back a little bit,” says Trimarchi. “You can’t expand the aisle, so what ends up happening is maybe now have to try to sell out of a few feet less, because we’ve got to take that space to introduce this whole new line of popcorn.” This isn’t a problem, he says, it just means operators have to stay on their toes. “If we stick to tried-and-true merchandising plans and price promotion activities, we can maintain our sales in those while still growing snacking.”

Keeping the snack section looking fresh is key, he adds: bags need to be kept in good shape, and the section needs to be constantly replenished. And since these snacks are typically an impulse purchase, positioning displays throughout the store in “quick-impulse areas” is important as well. “It just comes down to good merchandising,” says Trimarchi. “A good operator putting the right product in the right spot—not too much, you know, you can’t go nuts—and then just keep an eye on it and manage it day to day ... Because there’s definitely margin to be made, there’s money to be made in this category; it’s not giveaway sales.”

Trimarchi relies on the vendor community to bring new savoury snack innovations forward. “We’ll try it, and if it maintains its sales then we’ll hold it; and if it doesn’t, then we just kind of rotate it out for the next item,” he explains. Sampling is also helpful when it comes to introducing new snacks, he says. “If you do sample these products, you can see some pretty good sales growth.”

This article appeared in Canadian Grocer’s February 2019 issue.