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Snack Attack

A wide new array of products is putting some zing into the salty snacks category. Best of all, potato chips, tortilla chips and pretzels are getting healthier

Recently, while pushing an oversized and overloaded shopping cart to the checkout at my local Costco, I made an unscheduled pit stop at a sampling station. A friendly employee was serving thimble-sized cups of a new salty snack called Popchips. My first impression was “Mmm, these are tasty.” I grabbed a bag and continued on my way. Popchips, produced by a San Francisco company of the same name, have never been fried (that would be unhealthy, according to the message on the package) or baked, which would take the edge off the zesty barbecue seasoning. “We start with wholesome potatoes,” the manufacturer tells us, “add a little heat and pressure, and pop: it’s a chip.”

A few weeks earlier, while completing my Saturday morning shopping at a Real Canadian Superstore, I stopped to sample another salty snack–this one a flat, triangular offering that was as thin and as crisp as a potato chip, but was made of rice. It was darned tasty, too, and I tossed a couple of bags into the cart.

It’s no accident that grocers are offering shoppers free tastes of chips and assorted salty snacks. The salty snack category has been all but reinvented in the last few decades with an array of new product offerings. If you plopped a grocer from the 1980s into today’s snack aisle he would hardly recognize the place. (“Rice cakes? Low-fat chips? What’s going on here?”)

Healthy, with a chance of salt

The metamorphosis of the snack aisle is the result of several intertwining trends. First, consumers snack more often today–10% more, in fact, than a decade ago, according to NPD Group. And they’re demanding more variety. Second is the push toward healthy eating. Consumers are avoiding unhealthy foods, and nothing says “unhealthy” quite like an oversalted, trans fat-soaked chip. Manufacturers have responded with a wider selection of new products to meet those health concerns. Our 1980s grocer would be baffled by today’s packaging claims of zero trans fats and baked, not fried, chips.

Speaking of trans fats, manufacturers today are going well beyond eliminating trans fats in order to make their products attractive to the health-conscious consumer. New processes for producing baked potato chips and corn-based snacks have reduced the overall fat content by as much as 80%. Salt content has been cut by 25% in some products and many now contain no preservatives and no artificial flavours or colours.

“We’ve removed trans fats from every product we sell, which was a great achievement, but it wasn’t cheap,” says Sebastian Brandt, director of the sensible products portfolio at Frito Lay Canada in Mississauga, Ont. “The No. 1 thing consumers want is great taste. They also want nutritional snacks. We’ve had to satisfy both.”

It’s a tricky balance, says Brian Johns, co-owner of Vince’s Market, a four-store independent grocer in Toronto. “Consumers are looking for less salt. But if you remove too much it kills the flavour and they won’t buy the product,” he says.

But judging by sales, consumers don’t mind the reformulations. Salty snack foods–a broad category that includes popcorn, pretzels and tortilla chips–remain enormously popular with Canadians. In the year ended April 10, 2010, Canucks spent $1.43 billion on salty snacks, up 6% from a year earlier, according to Nielsen (see chart on page 63). Potato chips still dominate, with more than half the sales, $768 million, up 7% over last year.

One category of salty snacks that’s more popular than ever is nuts, especially varieties such as almonds and walnuts, which are high in fibre and protein. It used to be that 60% of nut sales occurred in the pre-Christmas season, from September to December, says Joe Milando, vice-president of Mississauga, Ont.-based Trophy Foods. But that’s starting to change as nuts are turning into an all-season snack. “It’s all health-related,” says Milando. “The biggest growth right now is occurring in fruit-and-nut mixes.” Nut and seed sales overall are up 4% in the last year. The biggest gainer in the category? Sunflower and pumpkin seeds, at 11%.

Flavours with oomph!

The changes sweeping salty snacks have also opened the door for brand new foods. One of these is a triangular-shaped, brown rice chip called Riceworks that was developed by a California farmer in 2005. Riceworks, which comes in a variety of flavours including Sweet Chili, Parmesan and Sun-dried Tomato, has been sold in Canada since 2007, says Tricia Ryan, director of marketing with Riceworks maker, Shearer’s Foods Inc. Currently, 70% of Canadian supermarkets carry the product and consumer surveys indicate it has achieved a 17% public awareness level, largely through sampling. Riceworks is marketed as a healthy salty snack alternative that’s free of preservatives, artificial flavours, wheat and gluten.

But for all the new offerings available, old favourites remain the cornerstone of the salty snack aisle. Consumers in almost every demographic love potato chips, says Frito Lay’s Brandt. The challenge is boosting sales. He notes that the company spends $1 million annually on research and development aimed at improving quality, and introducing new flavours every year, most recently Barbecue Rib and Cheddar & Sour Cream.

Other products are aimed at specific demographics and have to be packaged and marketed to appeal to shoppers. Well-educated, upper-income women aged 25 to 54 are the target market for Riceworks. As a result, says Ryan, the product comes in a bag with a matted finish that is meant to be quiet and elegant, and look more distinct than the glossy, colourful bags of most snack foods.

Frito Lay’s Doritos, a rolled, corn chip, is at the opposite end of the taste and shopper spectrum. Doritos now come in wild flavours–Scream Cheese, Collisions and Zesty, to name a few–and for good reason. They’re aimed at young men in their 20s, a demographic known as “millennials” because they came of age in the first decade of the new century. Those in this group, notes Brandt, are looking for intense flavour in their snacks.

But whether it’s intensity or a familiar flavour, the category has something for every taste bud. And these days, the offerings are nutritious to boot.

5 Merchandising Tips

1. Discount coupons or price slashing may work for well-established products, but sampling is most effective for new snacks or those aimed at niches in the market.

2. Dips and spreads go very well with all sorts of salty snacks. But if you cross-merchandise, make sure to pair together complementary flavours.

3. Some THINGs are just meant to be consumed together, like burgers and fries or bacon and eggs. The same goes with chips and pop. Boost sales of both through cross-promotion. “Someone may go into the store to buy chips or a crisp snack and buy a beverage if it is discounted, or vice versa,” says Sebastian Brandt at Frito Lay Canada.

4. Shoppers often buy salty snacks on impulse, so highly visible positioning is important. New flavours should be placed on the floor, close to checkout counters.

5. Boost sales by pushing nuts in the fall and the weeks leading up to Christmas, says Joe Milando of Trophy Foods. He suggests dropping a half pallet in the power aisle or relying on smaller end-cap displays. Either way, visibility is the key.

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